-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TyK5Z14mvGqu9JrmlRj9lgRK3Z27Rb6Z56NS7MvhH8SjxAx5+OzIXGb/fQI6hMUB tMIdqOBH85vjfGnaz+mSYg== 0001072993-99-000041.txt : 19990226 0001072993-99-000041.hdr.sgml : 19990226 ACCESSION NUMBER: 0001072993-99-000041 CONFORMED SUBMISSION TYPE: S-1 PUBLIC DOCUMENT COUNT: 54 FILED AS OF DATE: 19990225 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COMPS COM INC CENTRAL INDEX KEY: 0001080232 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-1 SEC ACT: SEC FILE NUMBER: 333-72901 FILM NUMBER: 99549181 BUSINESS ADDRESS: STREET 1: 9888 CARROLL CENTRE ROAD STREET 2: SUITE 100 CITY: SAN DIEGO STATE: CA ZIP: 92126 BUSINESS PHONE: 6195783000 MAIL ADDRESS: STREET 1: 9888 CARROLL CENTRE ROAD STREET 2: SUITE 100 CITY: SAN DIEGO STATE: CA ZIP: 92126 S-1 1 FORM S-1 As filed with the Securities and Exchange Commission on February 24, 1999 Registration No. 333- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------- FORM S-1 REGISTRATION STATEMENT Under the Securities Act of 1933 ---------------- COMPS.COM, INC. (Exact Name of Registrant as Specified in its Charter)
Delaware 7375 33-0645337 (State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer Incorporation or Organization) Classification Code Number) Identification Number)
---------------- 9888 Carroll Centre Road, Suite 100 San Diego, California 92126-4581 (619) 578-3000 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices) ---------------- Mr. Christopher A. Crane President and Chief Executive Officer COMPS.COM, INC. 9888 Carroll Centre Road, Suite 100 San Diego, California 92126-4581 (619) 578-3000 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service) ---------------- Copies to: Craig S. Andrews, Esq. Lawrence D. Levin, Esq. Faye H. Russell, Esq. Katten Muchin & Zavis Brobeck, Phleger & Harrison LLP 525 West Monroe Street, Suite 1600 550 West C Street, Suite 1300 Chicago, Illinois 60661 San Diego, California 92101 (312) 902-5200 (619) 234-1966
---------------- Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. [_] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box. [_] ---------------- CALCULATION OF REGISTRATION FEE - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------
Title of Each Class of Proposed Maximum Amount of Securities to be Registered Aggregate Offering Price(1) Registration Fee(1) - --------------------------------------------------------------------------------------------- Common Stock, par value $0.01 per share.... $50,000,000 $13,900
- -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (1) Estimated pursuant to Rule 457(o) solely for the purpose of calculating the amount of the registration fee. ---------------- The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to Section 8(a), may determine. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ +The information in this preliminary prospectus is not complete and may + +change. We and the selling stockholders may not sell these securities until + +the registration statement filed with the SEC is effective. This preliminary + +prospectus is not an offer to sell these securities, and it is not soliciting + +an offer to buy these securities in any state where the offer or sale is not + +permitted. + ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ SUBJECT TO COMPLETION, DATED FEBRUARY 24, 1999 Shares [LOGO] Common Stock ------------ COMPS.COM, INC. is offering shares of its common stock. This is our initial public offering and no public market currently exists for our shares. We anticipate that the initial public offering price will be between $ and $ per share. ------------ We intend to list our common stock on the Nasdaq National Market under the symbol "CDOT." ------------ Please see "Risk Factors" beginning on page 7 to read about certain risks that you should consider before buying shares of our common stock. ------------ PRICE $ PER SHARE ------------
Per Share Total --------- ----------- Public offering price.................................... $ $ Underwriting discounts and commissions................... $ $ Proceeds, before expenses, to COMPS.COM.................. $ $
The Securities and Exchange Commission and state securities commissions have not approved or disapproved of these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters have an option to purchase additional shares from us and the selling stockholders to cover over-allotments of shares. We will not receive any of the proceeds from the sale of shares by the selling stockholders. ------------ Volpe Brown Whelan & Company EVEREN Securities, Inc. Needham & Company, Inc , 1999 Front Cover: [The front cover will have a dark background and the text will be printed in white. A picture of database wheel resembling a radar screen will appear on the background of the front cover.] [LOGO] Inside Front Cover: COMPREHENSIVE CONTENT [The following text are placed in varying fonts and font sizes throughout the recurring database wheel: buyers & sellers, phone number, square footage, contact name, capitalization rate, building characteristics and condition, confirmed sales price, financing information, income and expense, unit mix, color photos, lenders, financing. Four screen shots of four different pages from our Web site showing some of our products are placed on parts of the database wheel.] Inside Spread: DYNAMIC DELIVERY [A two page spread of a screen depicting a picture of a page on our Web site. Our market segments are listed in a bar down the left side of the screen. Each market segment is underlined. In the main frame of the screen is (1) a picture of a hand with a mouse, (2) the database wheel laid on top of a group of commercial real estate buildings, (3) an arrow pointing at the center of the database wheel and (4) a screen shot of a page from our Web site.] 2 Table of Contents
Page ---- Prospectus Summary....................................................... 4 Risk Factors............................................................. 7 Use of Proceeds.......................................................... 17 Dividend Policy.......................................................... 17 Capitalization........................................................... 18 Dilution................................................................. 19 Selected Financial Data.................................................. 20 Management's Discussion and Analysis of Financial Condition and Results of Operations........................................................... 21 Business................................................................. 29
Page ---- Management................................................................. 40 Certain Relationships and Related Transactions............................. 51 Principal and Selling Stockholders......................................... 53 Description of Securities.................................................. 54 Shares Eligible For Future Sale............................................ 58 Underwriting............................................................... 59 Legal Matters.............................................................. 61 Experts.................................................................... 61 Where You Can Find More Information........................................ 61 Index to Financial Statements.............................................. F-1
--------------- Notes to Readers of this Prospectus . Comps Incorporated was incorporated in California in January 1982. It was purchased by Business Real Estate Information Corp. in 1992 and reincorporated in Delaware in 1994 as COMPS InfoSystems, Inc. In January 1999, we changed our name to COMPS.COM, INC. Our principal executive offices are located at 9888 Carroll Centre Road, Suite 100, San Diego, California 92126. Our telephone number at that location is (619) 578-3000. Our Web site address is www.comps.com. Information contained on our Web site does not constitute part of this prospectus. . This offering is for shares; however, the underwriters have a 30-day option to purchase up to additional shares from us and the selling stockholders to cover over-allotments. Some of the disclosures in this prospectus would be different if the underwriters exercise the option. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise the option. . Unless we tell you otherwise, all information in this prospectus relating to our outstanding common stock: (1) reflects the automatic conversion of each share of our Class B common stock into one share of our Class A common stock and the renaming of such stock as "common stock" upon the closing of this offering, (2) reflects the automatic conversion of each share of our preferred stock into one share of our common stock upon the closing of this offering; (3) reflects the exercise of warrants outstanding to purchase 723,295 shares at a weighted average exercise price of $0.01 per share and (4) reflects a for stock split of our common stock to be effected prior to the closing of this offering. . COMPS, COMPSLink, CallCOMPS, WinCOMPS, COMPS NET, REALBID and our logo are our registered trademarks. Each other trademark, trade name or service mark appearing in this prospectus belongs to its holder. --------------- Special Note Regarding Forward-Looking Statements This prospectus may contain forward-looking statements based on our current expectations, assumptions, estimates and projections about us and our industry. These forward-looking statements involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, as more fully described in the "Risk Factors" section and elsewhere in this prospectus. We are not obligated to update or revise these forward-looking statements to reflect new events or circumstances. --------------- You should rely only on the information contained in this document or to which we have referred you. We have not authorized anyone to provide you with information that is different. This document may only be used where it is legal to sell these securities. The information in this document may only be accurate on the date of this document. --------------- Until , 1999, all dealers selling shares of our common stock, whether or not participating in this offering, may be required to deliver a prospectus. This delivery requirement is in addition to the obligation of dealers to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions. 3 Prospectus Summary This summary highlights some of the information in this prospectus. It may not contain all of the information that is important to you. To understand this offering fully, you should read the entire prospectus carefully, including the risk factors and financial statements. About COMPS Our Business We are a leading national provider of confirmed commercial real estate sales information both offline and on the Internet. We have also recently begun leveraging our extensive database to facilitate commercial real estate transactions on the Internet. Over the last 17 years, we have developed a highly evolved data collection and confirmation system to provide information on commercial real estate properties. We believe we have established the foundation to be the trusted online resource linking commercial real estate brokers, lenders, appraisers, insurers and other professionals by efficiently distributing market information on the Internet. Our Market The Internet has rapidly become a significant global medium for communications, information and commerce. It has emerged as a primary business channel alongside the telephone, paper-based communication and face-to-face interaction. The Internet allows online providers to efficiently distribute information with the potential for less infrastructure and overhead and greater economies of scale. It also offers customers diverse options and unparalleled convenience. The commercial real estate market is large and fragmented. Prior to the availability of confirmed sales information from a centralized source, commercial real estate professionals either maintained their own research departments to catalog comparable sales, market statistics and other property- specific information, or aggregated such information, to the limited extent available, from multiple third parties. These methods resulted in high internal costs and nonstandard data with varying degrees of comprehensiveness and accuracy. In addition, there are currently no comprehensive, standardized transaction support services that efficiently identify properties and bring together brokers, buyers, lenders and insurers in commercial real estate transactions. Our Solution The vast information sharing and communications power of the Internet creates an opportunity to improve upon the inefficiencies in conducting commercial real estate transactions. We provide comprehensive and reliable information services, and transaction support products that save industry professionals both time and money. To date, we have: . developed a comprehensive and standardized proprietary database of approximately 400,000 commercial real estate transactions; . migrated our database to the Internet, allowing our customers to receive updated commercial real estate transaction information more frequently and analyze the data more quickly and easily; . established an Internet-based listing-broker/buyer matching service, allowing us to identify and refer potential buyers of listed properties to brokers and actively market these properties for brokers using our Internet- based new listing notification system; and . introduced an Internet-based commercial real estate listing service, enabling brokers to market their properties over the Internet and increase a property's exposure to prospective buyers and their brokers. Our Business Strategy Our objective is to be the trusted online resource linking commercial real estate professionals by efficiently distributing market information on the Internet. Our business strategy to achieve this objective includes the following key elements: . continue to enhance our comprehensive historical database of commercial real estate transactions; . expand our online listing-broker/buyer matching service; . create a comprehensive online national listing service for commercial real estate; . enhance our services and products to facilitate the online exchange of commercial real estate market information; . expand into new geographic markets; and . continue to build our brand name. 4 The Offering Common stock offered by us.............. shares Common stock outstanding after this offering............................... shares Use of proceeds......................... For working capital and other general corporate purposes, including expansion of our proprietary database, enhancement and development of existing and new information services and transaction support products, geographic expansion, and repayment of debt. We may also use a portion of the proceeds for strategic alliances and acquisitions. Please see "Use of Proceeds." Proposed Nasdaq National Market symbol.. CDOT
The information above is as of December 31, 1998. In addition to the shares of common stock to be outstanding after this offering, we may issue the following securities, which share numbers do not reflect a stock split of to , which is subject to stockholder approval: . 2,385,449 shares upon the exercise of options outstanding at a weighted average exercise price of $0.86 per share; . 213,068 shares upon the exercise of warrants outstanding at a weighted average exercise price of $1.76 per share; and . 512,909 shares upon exercise of options available for issuance under our stock plans. For a description of our stock option plans, please see "Management--Benefit Plans." 5 Summary Financial And Operating Data (dollars in thousands, except per share and other operating data) The following table summarizes the financial data for our business. The pro forma statement of operations data gives effect to our acquisition of REALBID, LLC as if it had occurred on January 1, 1998.
Year Ended December 31, ----------------------------------------------------------- Pro Forma 1994 1995 1996 1997 1998 1998 -------- -------- -------- -------- -------- --------- Statement of Operations Data: Net revenues............ $ 6,030 $ 6,716 $ 8,141 $ 10,450 $ 12,806 $13,029 Cost of revenues........ 2,674 3,488 4,357 5,054 5,746 5,791 -------- -------- -------- -------- -------- ------- Gross profit............ 3,356 3,228 3,784 5,396 7,060 7,238 Operating expenses: Selling and marketing.. 2,306 2,072 2,813 3,408 4,182 4,182 Product development and engineering........... -- -- 376 768 1,230 1,230 General and administrative........ 1,743 2,527 2,835 2,525 2,936 3,638 -------- -------- -------- -------- -------- ------- Total operating expenses............ 4,049 4,599 6,024 6,701 8,348 9,050 -------- -------- -------- -------- -------- ------- Loss from operations.... (693) (1,371) (2,240) (1,305) (1,288) (1,812) Other income (expense), net.................... (9) 12 (67) (252) (260) (260) -------- -------- -------- -------- -------- ------- Net loss................ (702) (1,359) (2,307) (1,557) (1,548) (2,072) Dividend accretion on preferred stock........ 63 299 299 299 363 363 -------- -------- -------- -------- -------- ------- Net loss attributable to common stockholders.... $ (765) $ (1,658) $ (2,606) $ (1,856) $ (1,911) $(2,435) ======== ======== ======== ======== ======== ======= Net loss per share attributable to common stockholders, basic and diluted................ $ (0.12) $ (0.35) $ (0.55) $ (0.39) $ (0.40) $ (0.51) ======== ======== ======== ======== ======== ======= Shares used in computing net loss per share attributable to common stockholders, basic and diluted................ 6,408 4,774 4,774 4,774 4,795 4,795 ======== ======== ======== ======== ======== ======= Pro forma net loss per share, basic and diluted................ $ (0.16) $ (0.22) ======== ======= Shares used in computing pro forma net loss per share, basic and diluted................ 9,635 9,635 ======== ======= Other Operating Data: Markets covered by database.............. 16 24 24 25 34 Transactions in database.............. 245,951 270,945 302,684 341,670 387,427 Value of transactions in database (dollars in millions).......... $ 191 $ 222 $ 272 $ 355 $ 460 Value of transactions supported by REALBID (dollars in millions)............. -- -- -- $ 300 $ 3,800
At December 31, 1998 ----------------------- Actual As Adjusted --------- ------------ Balance Sheet Data: Cash and cash equivalents............................... $ 378 $ Working capital (deficit)............................... (4,354) Total assets............................................ 7,397 Deferred subscription revenue........................... 5,503 Long-term debt, less current portion.................... 1,123 Redeemable convertible preferred stock.................. 7,316 Total stockholders' deficit (9,195)
- -------- Please see Note 1 to our financial statements for an explanation of the determination of the number of shares used in computing pro forma net loss per share. The as adjusted balance sheet data listed above reflects the sale of shares of common stock offered at an assumed initial public offering price of $ per share after deducting the estimated underwriting discount and estimated offering expenses payable by us. Please see "Use of Proceeds" and "Capitalization" for a discussion about how we intend to use the proceeds from this offering and about our capitalization. 6 Risk Factors Any investment in our common stock involves a high degree of risk. You should consider carefully the following information about these risks, together with the other information contained in this prospectus, before you decide to buy our common stock. If any of the following risks actually occur, our business would likely suffer. In such case, the trading price of our common stock could decline, and you may lose all or part of the money you paid to buy our common stock. Risks Related to Our Business We may not achieve future profitability due to continued operating losses and negative cash flows. We have incurred significant net losses since our inception. As of December 31, 1998, we had an accumulated deficit of $11.4 million. We have incurred substantial costs to expand into new markets, develop new products and create, introduce and enhance our Web site. We expect operating losses and negative cash flows to continue for the foreseeable future as we continue to incur significant expenses. As a result, we will need to generate significant revenues to achieve profitability. Even if we do become profitable, we cannot assure you that we can sustain or increase profitability on a quarterly or annual basis. If revenues grow more slowly than we anticipate, or if operating expenses exceed our expectations or cannot be adjusted in response to slower revenue growth, our business will be materially adversely affected. Please see "Selected Financial Data" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our financial statements for detailed information related to our uncertain profitability. We have only been operating on the Internet since 1998 and cannot assure you that our Internet products will achieve market acceptance. We only recently began offering our services on the Internet. During 1998, over 90% of our revenue was a result of our information services products delivered on CD-ROM and other non-Internet media. Less than 10% of our revenues in 1998 were a result of our services and products delivered on the Internet. We intend to continue to increase our reliance on the Internet for delivery of our services and products. As a result, our future profitability will increasingly rely upon the use of our information services and transaction support products on the Internet. Our ability to obtain market acceptance for our Internet products will depend on the following factors: . our ability to transition our customers from the use of our services and products on CD-ROM to the use of these services and products on the Internet in a timely and efficient manner; . our customers' acceptance of, and their ability to adapt to the use of, our existing and future services and products on the Internet; and . our ability to anticipate and adapt to the changing Internet market. If our Internet-based information services or transaction support products are not received favorably by our current customers, it may negatively affect their use of our other products or cause new customers to choose a competitive service over ours. If we do not successfully develop new and enhanced services and products, our revenues could decrease. We will not be financially successful if we are unable to meet the increasingly sophisticated needs of our customers through timely developments and new and enhanced versions of our services and products. Our planned development and enhancement efforts have inherent risks. We may experience financial or technical difficulties that could prevent us from introducing new or enhanced information services or transaction support products. Furthermore, these new or enhanced services and products may contain problems that are discovered after the products are introduced. We may need to significantly modify the design of these products on the Internet to correct these problems. Our business could be materially adversely affected if we experience difficulties in introducing new or enhanced services and products or if these services or products are not 7 received favorably by our customers. Finally, development and enhancement of our services and products will require significant additional expenses and could strain our management, financial and operational resources. The lack of market acceptance of our services or products or our inability to generate satisfactory revenues from such development or enhancements to offset their costs could have a material adverse effect on our business. Our quarterly results of operations fluctuate which could cause our stock price to fluctuate. Our quarterly operating results have fluctuated significantly and are expected to continue to fluctuate in the future due to a variety of factors, many of which are outside of our control. It is possible that in some future periods our results of operations may be below the expectations of public market analysts and investors. In this event, the price of our common stock is likely to fall. Factors contributing to these fluctuations include: . the demand for and acceptance of information services and transaction support products on the Internet in general or on our Web site; . the loss of clients or revenue due to consolidation in the real estate brokerage, lending, appraisal, insurance and investment industries; . changes in rates paid for information services or transaction support products in the commercial real estate industry or related industries resulting from competition or other factors; . changes in customer budgets; . technical difficulties or system downtime affecting the Internet or the operation of our Web site and our ability to upgrade and develop our systems and infrastructure to minimize such difficulties in a timely and effective manner; . the amount and timing of our costs related to our product development, marketing efforts and other initiatives; . fees we may pay for distribution or content or other costs we may incur as we expand our operations or geographic coverage; . our costs related to acquisitions of businesses, technologies, services and products; . economic conditions or other factors specific to the real estate market or the Internet as well as general economic and market conditions; . changes in the privacy laws that may hinder our ability to gather information necessary for our information services or transaction support products; or . the seasonality of our revenues. Due to all of these factors and the other risks discussed in this section, you should not rely on quarter-to-quarter comparisons of our results of operations as an indication of our future performance. Since we expect to be substantially dependent on revenues from our information services and transaction support products offered on the Internet, our quarterly revenues are likely to be particularly affected by the number of visitors to our Web site. In addition, our operating expenses are based on our expectations of our future revenues and are relatively fixed in the short-term. We may be unable to adjust spending quickly enough to offset any unexpected revenue shortfall. If we have a shortfall in revenues in relation to our expenses, or if our expenses increase before our revenues do, then our business for a particular quarter would be materially adversely affected. This could affect the market price of our common stock. Please see "Management's Discussion and Analysis of Financial Condition and Results of Operations" for detailed information on our quarterly operating results. We may need additional capital by the end of 2000. We currently anticipate that the net proceeds of this offering, together with available funds, will be sufficient to meet our anticipated needs until at least the end of 2000. We may need to raise additional funds in 8 the future in order (1) to fund more rapid expansion, (2) to develop new or enhanced services or products, (3) to respond to competitive pressures, (4) to acquire complementary businesses, technologies or services or (5) to conduct more aggressive brand promotions. Additional financing may not be available on terms favorable to us, if at all. If adequate funds are not available or not available on acceptable terms, we may be unable to fund our expansion, take advantage of acquisition opportunities, develop or enhance our services or products, respond to competitive pressures or successfully promote our brand name. Any such inability could have a material adverse effect on our business. If we do not expand our geographic coverage our services and products could become less desirable. We believe our success is highly dependent on our ability to increase the geographic coverage of our database. Currently our proprietary database contains confirmed sales comparable records in 35 of the 74 largest markets in the U.S. If we are not able to expand the geographic coverage of our database into other markets, our business could be materially adversely affected. We also plan to expand into selected international markets. We expect this geographic expansion effort to impose additional burdens on our research, sales and administrative resources. Please see "Business--Our Business Strategy" for a discussion of our geographic expansion strategy. If we cannot maintain the integrity and reliability of our proprietary database, we may not be successful. We cannot assure you that the information in our database will be comprehensive, accurate or timely, particularly as we grow. Our success is highly dependent on our customers' confidence in the comprehensiveness, accuracy and timeliness of our proprietary database of confirmed commercial real estate transactions and the software used to access our database. We expect the task of establishing and maintaining such comprehensiveness, accuracy and timeliness during the growth of our business to require substantial effort and expense. Please see "Business--Our Proprietary Database" for a discussion of how we maintain our proprietary database. Cyclical economic swings in the real estate market could decrease demand for our services and products. The real estate industry traditionally has been subject to cyclical economic swings which could materially adversely affect our business. Our business is dependent on the real estate industry and related industries that supply goods or services to, or invest in, the real estate industry. Changes in the real estate market may affect demand for our services and products. These cyclical economic swings may be caused by various factors, such as, changes in interest rates and changes in economic conditions. When interest rates are high or general economic conditions are weak, there may be less sales activity in commercial real estate and on the part of mortgage brokers and lenders. These cyclical economic swings could materially adversely affect our business. Consolidation of the real estate industry could negatively impact our business. The real estate industry is undergoing a period of consolidation, motivated in part by a desire to reduce expenses. Such consolidation poses a number of risks and could materially adversely affect our business. These risks include: . a decrease in our client base; . reduction in the size of our target market; . creation of competitors with sufficiently greater bargaining power which could cause price erosion; . creation of competitors with access or rights to, or ownership of, sources that provide the data we need for our proprietary database; and . reduction in the number of sources from whom we obtain data for our proprietary database. 9 We may not be able to successfully develop our "COMPS.COM" brand name. To be successful, we must strengthen awareness of our brand name. In order to build our brand name, we must succeed in our marketing efforts, provide high- quality services and products and increase the number of visitors to our Web site. If our marketing efforts are not successful or if we cannot increase awareness of our brand name, our business would be materially adversely affected. If we are unable to continue to develop our direct sales force, it could materially adversely affect our business. In order to support our growth, we need to substantially increase the size of our direct sales force. Our ability to increase our direct sales force involves a number of risks, including: . the competition we face from other companies in hiring and retaining sales personnel; . our ability to integrate and motivate additional sales and sales support personnel; . our ability to manage a multi-location sales organization; and . the length of time it takes new sales personnel to become productive. There would be a material adverse effect on our business if we do not continue to develop and maintain an effective direct sales force. Intense competition may render our services and products uncompetitive or obsolete. The market for our Internet-related and non-Internet-related information services and transaction support products is competitive. Our principal competitive factors are: . quality and depth of the underlying databases; . the proprietary nature of methodologies, databases and technical resources; . the usefulness of the data and reports generated by our software; . effectiveness of marketing and sales efforts; . customer service and support; . compatibility with the customer's existing information systems; . vendor reputation; . price; . timeliness; and . brand loyalty. We compete directly and indirectly for customers and content providers with the following categories of companies: . publishers and distributors of traditional off-line information services; . online services or Web sites targeted to commercial real estate brokers, appraisers, mortgage brokers, lenders, buyers and sellers of commercial real estate properties and insurance companies; and . public record providers. We cannot assure you that our competitors will not develop services or products that are equal or superior to ours or that achieve greater market acceptance. We anticipate that the number of direct and indirect competitors will increase in the future and could result in price reductions, reduced margins, greater operating losses or loss of market share, any of which would materially adversely affect our business. For further information about our competition, please see "Business--Competition." If we fail to be year 2000 compliant, it could harm our business. We have not fully completed tests to assure that our information technology systems will function properly in the year 2000. Our computer systems and software programs may need to be upgraded in order to 10 comply with year 2000 requirements, or we risk system failure or miscalculations causing disruptions of normal business activities. We estimate expenses to achieve year 2000 readiness will be $300,000, $150,000 of which was expended prior to December 31, 1998. Until our testing is complete and such vendors and providers are contacted, we will not be able to completely evaluate whether our information technology systems or non- information technology systems will need to be revised or replaced. If our efforts to address year 2000 risks are not successful, or if suppliers or other third parties with whom we conduct business do not successfully address such risks, it could have a material adverse effect on our business. Please see "Management's Discussion and Analysis of Financial Condition and Results of Operations--Impact of the year 2000" for detailed information on our state of readiness, potential risks and contingency plans regarding the year 2000 issue. If we do not effectively manage our growth, it could have a material adverse effect on our business. We have experienced growth in our business which we expect to continue. Such growth has placed, and will continue to place, a significant strain on our management systems and resources. We will need to continue to improve our operational and financial systems and managerial controls and procedures. We will need to continue to expand, train and manage our workforce. We expect that our workforce will continue to increase for the foreseeable future. We will have to maintain close coordination among our technical, accounting, finance, marketing, sales and research departments. If we fail to effectively manage our growth and address the above concerns it could have a material adverse effect on our business. If we do not successfully integrate acquired businesses with our business, it could have a material adverse effect on our business. Since October 1993, we have acquired six businesses and three product lines. We may not be able to integrate our recent or any future acquisitions successfully with our existing operations without substantial costs, delays or other problems. As we integrate acquired businesses or product lines, we could have difficulty in assimilating personnel and operations. In addition, the key personnel of acquired companies may decide not to work for us. We could also have difficulty in assimilating the acquired products, services or technologies into our operations. These difficulties could disrupt our ongoing business, distract our management and employees, increase our expenses and materially adversely affect our results of operations due to accounting requirements such as amortization of goodwill or other purchased intangibles. Furthermore, we may incur debt or issue equity securities to pay for any future acquisitions. The issuance of equity securities could be dilutive to our existing stockholders. If we are unable to retain key personnel or attract new personnel, it could have a material adverse effect on our business. The loss of the services of any of our key personnel or our inability to successfully attract and retain qualified personnel in the future would have a material adverse effect on our business. Our future success depends on the continued service of our key personnel, including Christopher A. Crane, our President and Chief Executive Officer, Emmett R. DeMoss, our Vice President and the Chairman of our REALBID division, Karen Goodrum, our Vice President of Finance and Administration, Chief Financial Officer and Secretary, Walter W. Papciak, our Executive Vice President of Sales, Marketing and Product Development, and Michael Arabe, our Senior Vice President of Sales. Mr. Crane is the only key person for whom we maintain life insurance (face amount of $2,000,000). Our future success also depends on our ability to attract, retain, integrate and motivate highly skilled researchers and other employees. Competition for researchers and other employees in our industry is intense, particularly in the San Diego area, where our headquarters are located. Please see "Management" for detailed information on our key personnel. 11 Increased users straining our systems and other systems malfunctions could materially adversely affect our business. The performance of our Web site is critical to our reputation, our ability to attract customers and market acceptance of our Web site. All of our communications and network infrastructure is hosted at our headquarters in San Diego. We have in the past experienced system failures, including network, software or hardware failures, that have interrupted or increased the response time of our online services. In the future, the capacity of our software and hardware could be strained by an increase in the use of our products on the Internet as we migrate our customers to the Internet. Our ability to provide uninterrupted, secure online services depends on our ability to protect our facilities and equipment against damage from fire, earthquakes, power loss, water damage, telecommunications failures, vandalism, computer viruses, hacker attacks and other malicious acts, and similar unexpected material adverse events. Customers may become dissatisfied if a system failure interrupts our ability to provide access to our Web site. Since our insurance policies have low coverage limits, our insurance may not adequately compensate us for any losses that may occur due to any system failures or interruptions. Our customers also depend on Internet service providers, online service providers and other Web site operators for access to our Web site. Each of them has experienced significant outages in the past, and could experience outages, delays and other difficulties due to system failures unrelated to our systems. Moreover, the Internet infrastructure may not be able to support continued growth in its use. Any of these problems could materially adversely affect our business. We may not be able to adequately protect our proprietary rights. It may be difficult to protect our proprietary rights. We regard our database of confirmed commercial real estate transactions and the software used to operate our Web site, as well as our various trademarks and copyrights, as proprietary. We will continue to attempt to protect them under a combination of copyright, trade secret and trademark laws, as well as by contractual restrictions on employees and third parties. Despite these precautions, it may be possible for unauthorized parties to copy our services or otherwise obtain and use information that we regard as proprietary. Existing trade secrets and copyright laws provide only limited protection. Certain provisions of other license and distribution agreements that we intend to use, including provisions protecting against unauthorized use, copying, transfer and disclosure, may be unenforceable under the laws of certain jurisdictions. Furthermore, we may be required to negotiate limits on these provisions from time to time. In addition, the laws of some foreign countries do not protect our proprietary rights to the same extent as do the laws of the U.S. The steps we take may not be adequate to deter misappropriation of proprietary information. We also may not be able to detect unauthorized use and take appropriate steps to enforce our intellectual property rights. Significant and protracted litigation may be necessary to protect our intellectual property rights, to determine the scope of the proprietary rights of others or to defend against claims for infringement. Third parties may assert claims against us alleging infringement, misappropriations or other violation of proprietary rights, whether or not such claims have merit. Such claims can be time consuming and expensive to defend and could require us to cease the use and sale of allegedly infringing services and products, to incur significant litigation costs and expenses, to develop or acquire non-infringing technology and to obtain licenses to the alleged infringing technology. We may not be able to develop or acquire alternative technologies or obtain such licenses on commercially acceptable terms. If we are not able to meet our customers' needs, it could result in liability for us. If our services or products either fail to satisfy a customer's needs or have a material adverse impact on a customer, the customer might bring a claim for damages against us, even if we are not responsible for such failure. The limitations of liability set forth in customer contracts may not be enforceable and may not otherwise protect us from liability for damages. The successful assertion of one or more large claims against us that exceed available insurance coverages, or changes in our insurance policies, such as premium increases or the imposition of large deductibles or co-insurance requirements could materially adversely affect our business. 12 Risks Related To Our Industry If Internet usage does not continue to grow, it could materially adversely affect our business. The Internet is relatively new and is rapidly evolving. Our business would be materially adversely affected if Internet usage does not continue to grow. Internet usage may be inhibited for a number of reasons, such as: . the Internet infrastructure may not be able to support the demands placed on it; . security and authentication concerns with respect to attempts by unauthorized computer users to penetrate network security and transmission over the Internet of confidential information, such as credit card numbers, may remain; and . privacy concerns, particularly because, for a variety of information gathering purposes, Web sites typically place certain information on a user's hard drive without the user's knowledge or consent. We may not be able to adapt to the rapid technological changes to the Internet and Internet Products. To be successful, we must adapt to the rapid technological changes to the Internet and Internet products by continually enhancing our Web site and introducing and integrating new services and products to capitalize on the technological advances in the Internet. This process is costly and we cannot assure you that we will be able to successfully integrate our services and products to the technological advances in the Internet. The collection, storage, management and dissemination of commercial real estate information from a centralized database on the Internet is a recent and evolving development. Our market is characterized by rapidly changing technologies, evolving industry standards, increasingly sophisticated customer needs and frequent new product introductions. These factors are exacerbated by the rapid technological change experienced by the computer and software industries. We could incur substantial costs if we need to modify our services or infrastructure in order to adapt to these changes. If we incurred significant costs without adequate results or we were unable to adapt to rapid technological changes, it could have a material adverse effect on our business. Adoption of new laws and government regulations relating to the Internet could harm our business. Our business could be materially adversely affected by the adoption or modification of laws or regulations in the U.S. or abroad relating to the Internet. Laws and regulations directly applicable to Internet communications and commerce are becoming more prevalent. Such legislation could dampen the growth in use of the Internet generally and decrease the acceptance of the Internet as a communications and commercial medium. The governments of states or foreign countries might attempt to regulate our transmissions or levy sales or other taxes relating to our activities. The laws governing the Internet, however, remain largely unsettled, even in areas where there has been some legislative action. It may take years to determine whether and how existing laws such as those governing intellectual property, privacy, libel and taxation apply to the Internet and Internet commerce. In addition, the growth and development of the market for Internet commerce may prompt calls for more stringent consumer protection laws, both in the U.S. and abroad, that may impose additional burdens on companies conducting business over the Internet. The growth and development of the market for Internet commerce may also prompt calls for widening access on the Internet to public records, including records concerning the commercial real estate industry. Internet security concerns could hinder Internet commerce and materially adversely affect our business. We may be required to expend significant capital and other resources to protect against security breaches on our Web site or to alleviate problems caused by such breaches. If any compromise of our security were to occur, it could damage our reputation and expose us to a risk of loss, litigation and possible liability. A significant barrier to online commerce and communications is the need for secure transmission of confidential information over public networks. Concerns over the security of transactions conducted on the Internet and other online services, as well as user's desires for privacy, may also inhibit the growth of the Internet and other online services especially as a means of conducting commercial transactions. Our services involve the storage and transmission of proprietary information, such as credit card numbers and other confidential information. 13 We cannot assure you that our security measures will prevent security breaches or that our failure to prevent such security breaches will not have a material adverse effect on our business. Although credit card companies and others are in the process of developing anti-theft and anti-fraud protections, and while we are continually monitoring this problem, at the present time the risk from such activities could have a material adverse effect on us. We cannot assure you that advances in computer capabilities, new discoveries in the field of cryptography or other events or developments will not result in a compromise or breach of the algorithms used by us to protect customer transaction data. A party who is able to circumvent our security measures could misappropriate confidential information or cause interruptions in our operations. We may be subject to legal liability for displaying or distributing information over the Internet. Because content on our Web site is distributed to others, we may be subjected to claims for defamation, negligence or copyright or trademark infringement or claims based on other theories. These types of claims have been brought, sometimes successfully, against Internet services in the past. We could also be subjected to claims based upon the content that is accessible from our Web site through links to other web sites or information on our Web site supplied by third parties. Our insurance may not adequately protect us against these types of claims. Even to the extent such claims do not result in liability to us, we could incur significant costs in investigating and defending against such claims. Our potential liability for information carried on or disseminated through our Web site could require us to implement measures to reduce our exposure to such liability, which may require the expenditure of substantial resources and limit the attractiveness of our service to users. We also enter into agreements with customers under which we are entitled to receive a flat fee related to the support of purchase of commercial properties through our Web site using REALBID or other transaction support products that we offer. Such arrangements may expose us to additional legal risks and uncertainties, including regulation by local, state, federal and foreign authorities and potential liabilities to property buyers, even if we are not selling such properties. The indemnification provided to us in our agreements with these parties, if available, may not be adequate. Risks Related To This Offering The number of shares eligible for public sale after this offering could cause our stock price to decline. The market price of our common stock could decline as a result of sales of a large number of shares of our common stock in the market after this offering or the perception that such sales could occur. Such sales also might make it more difficult for us to sell equity securities in the future at a price that we deem appropriate. After this offering, we will have outstanding shares of common stock. Of these shares, the shares being offered hereby are freely tradable. All of our directors and officers, stockholders, optionholders and warrantholders, who, as of December 31, 1998, held a total of 13,047,298 shares of our outstanding or issuable common stock, on a pre-split basis, have entered into lock-up agreements. Under these lock-up agreements, they have agreed that for a period of 180 days from the date of this prospectus, they will not, without the prior written consent of Volpe Brown Whelan & Company, LLC (1) offer, sell, contract to sell, make any short sale, pledge or otherwise dispose of, directly or indirectly, any shares of common stock, or options to acquire shares of common stock or securities convertible into or exchangeable for, or any other rights to purchase or acquire, common stock or (2) enter into swap or other agreements that transfer, in whole or in part, any of the economic consequences or ownership of common stock. As of December 31, 1998, options to purchase a total of 2,385,449 shares of common stock, on a pre-split basis, were outstanding, of which options to purchase 679,623 shares were exercisable. Of the options to purchase 1,705,826 shares of common stock that were not exercisable, options to purchase 152,000 shares of common stock, on a pre-split basis, shall immediately vest and become exercisable upon the closing of this offering. Upon the closing of this offering, we intend to file a registration statement to register for resale the 2,800,000 shares of common stock, on a pre-split basis reserved for issuance under our stock option plans. We 14 expect such registration statement to become effective immediately upon filing. Shares issued upon the exercise of stock options granted under our stock option plans will be eligible for resale in the public market from time to time subject to vesting and, in the case of certain options, the expiration of the lock-up agreements referred to below. As of December 31, 1998, certain stockholders and warrantholders, holding approximately 5,844,489 shares of outstanding or issuable common stock, on a pre-split basis, have the right, subject to certain conditions and limitations, to include their shares in certain registration statements relating to our securities. By exercising their registration rights and causing a large number of shares to be registered and sold in the public market, these holders may cause the price of the common stock to fall. In addition, any demand to include such shares in our registration statements could have a material adverse effect on our ability to raise needed capital. Please see "Management--Benefit Plans," "Principal and Selling Stockholders," "Description of Securities--Registration Rights," "Shares Eligible for Future Sale" and "Underwriting." The liquidity of our stock is uncertain, since it has never been publicly traded. Prior to this offering, there has been no public market for our common stock. We cannot predict if an active trading market in our common stock will develop or how liquid that market might become. The market price of the common stock may decline below the initial public offering price. The initial public offering price for the shares will be determined by negotiations between us and the representatives of the underwriters and may not be indicative of prices that will prevail in the trading market. Please see "Underwriting" for more information regarding how the initial public offering price was determined. The market price of our stock may be materially adversely affected by market volatility. The stock market has experienced extreme price and volume fluctuations. The market prices of the securities of Internet-related companies have been especially volatile. The trading price of our common stock could be subject to wide fluctuations in response to a number of factors, including: . our quarterly results of operations; . changes in earnings estimates by analysts and whether our earnings meet or exceed such estimates; . announcements of technological innovations by us or our competitors; . additions or departures of key personnel; . other matters discussed elsewhere in this prospectus; and . other events or factors, which may be beyond our control. In the past, companies that have experienced volatility in the market price of their stock have been the object of securities class action litigation. If we were the object of securities class action litigation, it could result in substantial costs and a diversion of our management's attention and resources. We have broad discretion regarding the use of the proceeds from this offering. We have not identified specific uses for most of the proceeds from this offering. Our management can spend most of the proceeds from this offering in ways with which the stockholders may not agree. Please see "Use of Proceeds" for detailed information on our intended use of the proceeds of this offering. The interests of our controlling stockholders may conflict with your interests. We anticipate that the executive officers, directors and entities affiliated with them will, in the aggregate, beneficially own approximately % of our outstanding common stock following the completion of this offering. These stockholders will be able to exercise control over all matters requiring approval by our stockholders, including the election of directors and approval of significant corporate transactions. This 15 concentration of ownership may also have the effect of delaying or preventing a change in control of us. Please see "Management" and "Principal and Selling Stockholders" for detailed information on the beneficial ownership of our executive officers, directors and affiliates. Anti-takeover provisions in our charter documents and Delaware law could make a third-party acquisition of us difficult. Certain provisions of our restated certificate of incorporation, our restated bylaws and Delaware law could make it more difficult for a third party to acquire us, even if doing so might be beneficial to our stockholders. Please see "Description of Securities" for detailed information on these provisions. You will suffer dilution in the value of your shares. Investors purchasing shares in this offering will incur immediate and substantial dilution in net tangible book value per share. To the extent outstanding options to purchase common stock are exercised, there will be further dilution. Please see "Dilution" for detailed information on dilution resulting from this offering. 16 Use of Proceeds We estimate that the net proceeds from the sale of the shares offered by us will be approximately $ million, assuming an initial public offering price of $ per share and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. If our portion of the underwriters' over-allotment is exercised in full, we estimate that such net proceeds will be approximately $ million. We intend to use the net proceeds of this offering for working capital and other general corporate purposes (approximately $ million), including expansion of our proprietary database, enhancement and development of existing and new information services and transaction support products and geographic expansion. We may also use a portion of the proceeds for strategic alliances and acquisitions. However, we currently have no strategic alliances or material acquisitions planned. We intend to use a portion of the net proceeds of this offering for repayment of $2.1 million of debt with various maturity dates between April 1999 and January 2002. Approximately $1.5 million of this debt bears interest at an annual rate of 8.75% during the term of the loan and a one-time 15% interest balloon payment is due upon completion of the term. The loan proceeds from $300,000 of this $1.5 million in debt loaned to us in October 1998 were used to acquire REALBID, LLC. Of the remaining approximately $600,000 of debt, $350,000 bears no interest and $250,000 will bear interest at 8% beginning December 1, 1999. We have not yet determined the amount of net proceeds to be used specifically for each of the foregoing purposes other than the repayment of debt. Accordingly, management will have significant flexibility in applying the net proceeds of this offering. Pending any such use, as described above, we intend to invest the net proceeds in interest-bearing instruments. We will not receive any proceeds from the sale of shares by the selling stockholders. Please see "Principal and Selling Stockholders" for a description of shares to be sold by selling stockholders. Dividend Policy We have never declared or paid any cash dividends on our capital stock. We currently intend to retain future earnings to support operations and to finance the expansion of our business. Any future determination to pay cash dividends will be at the discretion of our board of directors and will be dependent on financial condition, operating results, capital requirements and other factors that our board deems relevant. 17 Capitalization The following table sets forth on a pre-split basis our capitalization as of December 31, 1998 on an actual basis and as adjusted to give effect to the receipt by us of the estimated net proceeds from the sale of shares offered hereby at an assumed initial public offering price of $ per share. This information should be read in conjunction with our financial statements and the notes relating to such statements appearing elsewhere in this prospectus. This information is based on the number of shares of common stock outstanding on December 31, 1998. It excludes the following shares that we may issue: (1) 2,385,449 shares upon the exercise of options outstanding at a weighted average exercise price of $0.86 per share and (2) 213,068 shares upon the exercise of warrants outstanding at a weighted average exercise price of $1.76 per share. Please see "Management--Benefit Plans," "Description of Securities" and the more detailed financial statements and notes appearing elsewhere in this prospectus.
December 31, 1998 --------------------- Actual As Adjusted ------- ------------ (dollars in thousands) Long-term debt, less current portion..................... $ 1,123 Redeemable convertible preferred stock:.................. Preferred stock, $0.01 par value, 5,000,000 shares authorized on an actual basis; shares authorized on an as adjusted basis; 4,908,126 shares issued and outstanding on an actual basis; and no shares issued and outstanding on an as adjusted basis............... 7,316 Stockholders' equity (deficit): Common stock, $0.01 par value, 22,500,000 shares of Class A common stock and 2,500,000 shares of Class B common stock authorized on an actual basis; 4,773,860 shares of Class A common stock and 43,500 shares of Class B common stock issued and outstanding on an actual basis; shares issued and outstanding on an as adjusted basis.................................. 30 Additional paid-in capital............................. 4,760 Deferred compensation.................................. (2,539) Accumulated deficit.................................... (11,446) ------- ------------ Total stockholders' equity (deficit)..................... (9,195) ------- ------------ Total capitalization................................. $ (756) ======= ============
18 Dilution Our pro forma net tangible book value as of December 31, 1998, after giving effect to (1) the automatic conversion of each share of Class B common stock into one share Class A common stock and the renaming of such stock as "common stock," (2) the automatic conversion of each share of our preferred stock into one share of our common stock, (3) the exercise of warrants outstanding to purchase 723,295 shares at a weighted average exercise price of $0.01 per share and (4) a -for- stock split, was $ , or $ per share of common stock. Pro forma net tangible book value per share is equal to the amount of our total tangible assets less total liabilities, divided by the number of shares of common stock outstanding as of December 31, 1998. Assuming the sale by us of the shares offered hereby at an assumed initial public offering price of $ per share and after deducting underwriting discounts and estimated offering expenses, and the application of the estimated net proceeds therefrom, our pro forma net tangible book value as of December 31, 1998 would have been $ , or $ per share of common stock. This represents an immediate increase in pro forma net tangible book value of $ per share to existing stockholders and an immediate dilution in pro forma net tangible book value of $ per share to new investors. The following table illustrates this per share dilution: Assumed initial public offering price per share.............. $ Pro forma net tangible book value per share as of December 31, 1998.................................................. $ Increase attributable to new investors..................... -------- Pro forma net tangible book value per share after this offering.................................................... -------- Pro forma dilution per share to new investors................ $ ========
The following table summarizes, on a pro forma basis as of December 31, 1998, after giving effect to the automatic conversion of all outstanding shares of preferred stock into common stock, the total number of shares of common stock purchased from us, the total consideration paid to us and the average price per share paid by existing stockholders and by new investors:
Total Shares Purchased Consideration ----------------- ------------------ Average Price Number Percent Amount Percent Per Share --------- ------- ---------- ------- ------------- Existing stockholders........ % $ % $ New investors................ --------- ----- ---------- ----- Total..................... 100.0% 100.0% ========= ===== ========== =====
The tables and calculations above assume no exercise of outstanding options or warrants, other than those warrants exercisable for $0.01 per share. At December 31, 1998, on a pre-split basis there were (1) 2,385,449 shares issuable upon the exercise of options outstanding at a weighted average exercise price of $0.86 per share, (2) 213,068 shares issuable upon the exercise of warrants outstanding at a weighted average exercise price of $1.76 per share and (3) 512,909 shares available for issuance under our stock option plans. To the extent that these options or warrants are exercised, there will be further dilution to new investors. Please see "Management--Benefit Plans." 19 Selected Financial Data The following selected financial data should be read in conjunction with the financial statements and the notes to such statements and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included elsewhere in this prospectus. The statement of operations data for the three years ended December 31, 1998, and the consolidated balance sheet data at December 31, 1997 and 1998, are derived from our financial statements which have been audited by Ernst & Young LLP, independent auditors, and are included elsewhere in this prospectus. The statement of operations data for the two years ended December 31, 1995, and the consolidated balance sheet data at December 31, 1994, 1995 and 1996 are derived from audited financial statements not included in this prospectus. Historical results are not necessarily indicative of the results to be expected in the future. The pro forma statement of operations data gives effect to our acquisition of REALBID, LLC as if it had occurred on January 1, 1998.
Year Ended December 31, ----------------------------------------------------- Pro Forma 1994 1995 1996 1997 1998 1998 ------ ------- ------- ------- ------- --------- (in thousands, except per share data) Statement of Operations Data: Net revenues............. $6,030 $ 6,716 $ 8,141 $10,450 $12,806 $13,029 Cost of revenues......... 2,674 3,488 4,357 5,054 5,746 5,791 ------ ------- ------- ------- ------- ------- Gross profit............. 3,356 3,228 3,784 5,396 7,060 7,238 Operating expenses: Selling and marketing.. 2,306 2,072 2,813 3,408 4,182 4,182 Product development and engineering........... -- -- 376 768 1,230 1,230 General and administrative........ 1,743 2,527 2,835 2,525 2,936 3,638 ------ ------- ------- ------- ------- ------- Total operating expenses............ 4,049 4,599 6,024 6,701 8,348 9,050 ------ ------- ------- ------- ------- ------- Loss from operations..... (693) (1,371) (2,240) (1,305) (1,288) (1,812) Other income (expense), net..................... (9) 12 (67) (252) (260) (260) ------ ------- ------- ------- ------- ------- Net loss................. (702) (1,359) (2,307) (1,557) (1,548) (2,072) Dividend accretion on preferred stock 63 299 299 299 363 363 ------ ------- ------- ------- ------- ------- Net loss attributable to common stockholders..... $ (765) $(1,658) $(2,606) $(1,856) $(1,911) $(2,435) ====== ======= ======= ======= ======= ======= Net loss per share attributable to common stockholders, basic and diluted................. $(0.12) $ (0.35) $(0.55) $ (0.39) $ (0.40) $ (0.51) ====== ======= ======= ======= ======= ======= Shares used in computing net loss per share attributable to common stockholders, basic and diluted................. 6,408 4,774 4,774 4,774 4,795 4,795 ====== ======= ======= ======= ======= ======= Pro forma net loss per share, basic and diluted................. $ (0.16) $ (0.22) ======= ======= Shares used in computing pro forma net loss per share, basic and diluted................. 9,635 9,635 ======= =======
At December 31, -------------------------------------- 1994 1995 1996 1997 1998 ------ ------ ------ ------ ------ (in thousands, except per share data) Balance Sheet Data: Cash and cash equivalents............. $2,866 $ 260 $ 578 $ 352 $ 378 Working capital (deficit)............. 1,225 (1,119) (2,056) (3,053) (4,354) Total assets.......................... 4,687 4,714 4,224 4,091 7,397 Deferred subscription revenue......... 2,152 2,670 3,197 4,023 5,503 Long-term debt, less current portion.. 230 777 1,533 1,822 1,123 Redeemable convertible preferred stock................................ 4,919 5,218 5,517 5,816 7,316 Total stockholders' deficit........... (3,414) (5,072) (7,678) (9,505) (9,195)
Please see Note 1 to the financial statements appearing elsewhere in this prospectus for the determination of number of shares used in computing basic and diluted loss per share. 20 Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion of our financial condition and results of operations should be read in conjunction with the financial statements and the notes to those statements included elsewhere in this prospectus. This discussion may contain forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward- looking statements as a result of certain factors, such as those set forth under "Risk Factors" and elsewhere in this prospectus. Overview We are a leading national provider of confirmed commercial real estate sales information both offline and on the Internet. We have also recently begun leveraging our extensive database to facilitate commercial real estate transactions on the Internet. Over the last 17 years, we have developed a highly evolved data collection and confirmation system for providing information on commercial real estate properties. We believe we have established the foundation to be the trusted online resource linking commercial real estate brokers, lenders, appraisers, insurers and other professionals by efficiently distributing market information on the Internet. In January 1982, we first began providing confirmed sales information on commercial properties in San Diego County. From 1982 through 1985, we expanded our coverage throughout Southern California to Orange, Riverside, San Bernardino and Los Angeles counties and to Phoenix and Tucson, Arizona. We continued our geographic expansion from 1987 through 1992 with coverage of Northern California, Las Vegas and Seattle. During the period from June 1994 through December 1998, we further broadened our geographic reach to cover additional key markets including Washington D.C., New York, Chicago, Boston, Atlanta, Denver, Baltimore, Dallas/Fort Worth and Miami. This expansion was driven by both internal growth and acquisitions. We originally offered paper-based commercial real estate transaction information. In 1986, we introduced our CallCOMPS service, which permitted customers to call in and obtain sales transaction information, and, in 1990, we introduced a DOS-based subscription product. Through 1996, the majority of our revenues continued to come from print subscriptions. In October 1996, we began to offer our services on CD-ROM, allowing for the computerized manipulation of data to provide more customized reports. Most recently, in January 1998, we began to offer our information services on the Internet. This has allowed our customers to receive updated commercial real estate transaction information more frequently and analyze the data more quickly and easily. Delivery of our information on the Internet and other electronic media has provided additional value to customers, resulting in increased revenues from subscriptions and one- time, fee-based transactions. Less than 10% of our 1998 revenues were derived from delivery of our services and products on the Internet. We expect this percentage to increase as more of our customers transition to using our services and products on the Internet. In November 1998, we acquired the assets of REALBID, LLC, a real estate marketing services company which supports commercial real estate transactions on the Internet. As a result of this acquisition, our 1998 pro forma net revenues were $13.0 million and our pro forma operating expenses were $9.0 million, compared to our 1998 actual net revenues of $12.8 million and our actual operating expenses of $8.3 million. The purchase price of the acquisition totaled $2.3 million, which consisted of $163,000 in cash, stock options granted to the principals valued at approximately $2.1 million and acquisition costs of $54,000. Intangible assets of $2.2 million were recorded as a result of this acquisition. These intangible assets will be amortized over their estimated useful lives, ranging from three to five years, and will be primarily allocated to general and administrative expenses. In 1998, we amortized $82,000 relating to the intangible assets of REALBID, LLC. We currently expect to amortize the following amounts relating to the intangible assets of REALBID, LLC in the future: 1999--$489,000; 2000--$489,000; 2001-- $475,000; 2002--$396,000; and 2003--$313,000. Substantially all of our revenues have been derived from licensing our confirmed sales comparable information, either on a subscription or a per use basis, both offline and, to a lesser extent, on the Internet. 21 In 1998, approximately 75% of our information licensing revenue was derived from subscription contracts and approximately 25% was derived from fees paid on a per use basis. The subscription licenses range from one to three years and generally renew automatically for successive one-year terms. Many of the license rates increase at the time of renewal. Subscribers pay contract license fees on an annual, semi-annual, quarterly or monthly basis in advance of their license term. We recognize this revenue on a straight line basis over the life of the contract. Accordingly, contract license fees which are invoiced from a new contract or upon contract renewal result in deferred revenue. Since our November 1998 acquisition of REALBID, LLC, we have also begun to derive revenues from our transaction support services. For the period of November 6, 1998 through December 31, 1998, these revenues totaled approximately $17,000. The 1998 pro forma transaction support services revenues totaled approximately $240,000. We derive all of our transaction support product revenues from the delivery of products on the Internet. We recognize these revenues as services are provided. In order to expand our operations, we anticipate incurring additional expenses to: (1) implement new Internet-related products; (2) continue the integration of our REALBID services with our database; (3) further automate the data collection process; and (4) integrate acquired databases into our standardized format. We also intend to hire additional programmers and research employees as needed to implement our product development efforts and to continue to expand our database of commercial real estate. In addition, we intend to further expand our sales force and marketing team to further develop new and existing strategic relationships and strengthen our brand name as we enter new markets. Lastly, we anticipate incurring additional costs related to being a public company, including director's and officer's liability insurance, investor relation programs and professional service fees. As a result of these expenditures and other related factors, we expect to continue to incur losses for the forseeable future. We have incurred significant net losses since our inception. As of December 31, 1998, we had an accumulated deficit of $11.4 million. Also, in connection with the grant of certain stock options to employees during 1998, we recorded deferred compensation of approximately $2.7 million for the year ended December 31, 1998, representing the difference between the fair value of our common stock for accounting purposes and the exercise price of such options at the date of grant. Such amount is presented as a reduction of stockholders' equity and amortized over the vesting period of the applicable options, generally five years. In 1998, we recorded $118,000 in compensation expense and expect to record the following amounts in the future: 1999--$606,000; 2000-- $606,000; 2001--$606,000; 2002--$544,000; and 2003--$176,000. Results of Operations The following table sets forth certain statement of operations data expressed as a percentage of net revenues for the periods indicated:
Year Ended December 31, ----------------------------- 1996 1997 1998 ------- ------- ------- Statement of Operations Data: Net revenues................................... 100 % 100 % 100 % Cost of revenues............................... 54 48 45 ------- ------- ------- Gross profit................................... 46 52 55 Operating expenses: Selling and marketing........................ 34 33 32 Product development and engineering.......... 5 7 10 General and administrative................... 35 24 23 ------- ------- ------- Total operating expenses................... 74 64 65 ------- ------- ------- Loss from operations........................... (28) (12) (10) Other expense, net............................. (0) (3) (2) ------- ------- ------- Net loss....................................... (28)% (15)% (12)%
22 Comparison of Years Ended December 31, 1998, 1997 and 1996 Net Revenues Our net revenues for 1998 were $12.8 million, an increase of $2.4 million or 22.5% from 1997. Our net revenues for 1997 were $10.4 million, an increase of $2.3 million or 28.4% from $8.1 million in 1996. In both years the increase was primarily due to an increase in subscriptions as a result of geographic expansion and further penetration of our existing markets. We had no customer that accounted for more than 5% of our net revenues in 1998, 1997 or 1996. Cost of Revenues Cost of revenues consists primarily of compensation and benefits for research personnel. Our cost of revenues for 1998 was $5.7 million, an increase of $700,000 or 13.7% from 1997. Cost of revenues for 1997 was $5.1 million, an increase of $700,000 or 16.0% from $4.4 million in 1996. In both years, the increase in dollar amount was primarily due to an increase in sales transaction volume, and geographic expansion and the hiring of additional research employees. In addition, cost of revenues increased in 1997 due to the conversion of print subscriptions to CD-ROM format, as well as the full amortization of an asset relating to a 1995 purchase agreement which was amended in November 1997. Cost of revenues as a percentage of net revenues decreased to 45% for the year ended December 31, 1998 from 48% for the year ended December 31, 1997 and from 54% for the year ended December 31, 1996. In each year, the percentage decrease was primarily due to increased revenues during periods when certain costs remained relatively fixed. Selling and Marketing Expenses Selling and marketing expenses consist primarily of compensation and benefits for sales and marketing personnel, as well as sales commissions to our direct sales force. Our selling and marketing expenses for 1998 were $4.2 million, an increase of $800,000 or 22.7% from 1997. Our selling and marketing expenses for 1997 were $3.4 million, an increase of $600,000 or 21.2% from $2.8 million in 1996. In both years, the increases in dollar amount were primarily due to increases in commission expense, increases in telesales and marketing employees, and increases in direct marketing and technical support pertaining to the promotion of our COMPSLink/Windows product. As a percentage of net revenues, such expenses decreased to 32% for the year ended December 31, 1998 from 33% for the year ended December 31, 1997 and 34% for the year ended December 31, 1996. The percentage decreases were primarily due to increased revenues during periods when certain costs remained relatively fixed. Product Development and Engineering Expenses Product development and engineering expenses consist primarily of compensation and benefits for software engineers and quality assurance personnel and expenses for contract programmers and developers. Our product development and engineering expenses for 1998 were $1.2 million, an increase of $500,000 or 60.2% from 1997. Our product development and engineering expenses for 1997 were $800,000, an increase of $400,000 or 104% from $400,000 in 1996. As a percentage of net revenues, product development and engineering expenses increased to 10% for the year ended December 31, 1998 from 7% for the year ended December 31, 1997 and 5% for the year ended December 31, 1996. The dollar and percentage increases were primarily due to the hiring of additional software engineers and quality assurance personnel for development of new Internet-related products. General and Administrative Expenses General and administrative expenses consist primarily of compensation and benefits for finance and administrative personnel, professional fees, amortization expense, insurance expenses and charges relating to merchant credit card fees and bad debts. Our general and administrative expenses for 1998 were $2.9 million, an increase of $400,000 or 16.3% from 1997. This dollar increase in general and administrative expenses was 23 primarily due to efforts in connection with our acquisition strategy, increases in professional fees, increased expenses incurred in connection with increase in our work force and related payroll expenses. Our general and administrative expenses for 1997 were $2.5 million, a decrease of $300,000 or 10.9% from $2.8 million in 1996. As a percentage of net revenues, such expenses decreased to 23% for the year ended December 31, 1998 from 24% for the year ended December 31, 1997 and 35% for the year ended December 31, 1996. The dollar decrease in 1997 and the decreases in such expenses as a percentage of net revenues in both years were primarily due to decreases in payroll expense and professional fees. Other Expense, Net Other expense, net consists primarily of interest expense on our debt less the amount of interest we earn on our cash and short-term investments. Total other expense, net for 1998 was $260,000, an increase of $8,000 or 3.2% from 1997. Total other expense, net for 1997 was $252,000, an increase of $185,000 or 276% from $67,000 in 1996. In both years, the increase in other expense was primarily due to interest expense under a loan agreement. Quarterly Results Of Operations The following table sets forth certain unaudited quarterly statement of operations data for each of the eight quarters in the two year period ended December 31, 1998. In the opinion of management, this information has been prepared substantially on the same basis as the audited financial statements appearing elsewhere in this prospectus, and all necessary adjustments, consisting only of normal recurring adjustments, have been included in the amounts stated below to present fairly the unaudited quarterly results of operations data.
Three Months Ended ------------------------------------------------------------------------ March 31, June 30, Sept 30, Dec 31, March 31, June 30, Sept 30, Dec 31 1997 1997 1997 1997 1998 1998 1998 1998 --------- -------- -------- ------- --------- -------- -------- ------- (dollars in thousands) Statement of Operations Data: Net revenues............ $2,181 $2,562 $2,632 $3,075 $2,947 $3,226 $3,316 $ 3,317 Cost of revenues........ 1,163 1,191 1,264 1,436 1,287 1,306 1,468 1,685 ------ ------ ------ ------ ------ ------ ------ ------- Gross profit............ 1,018 1,371 1,368 1,639 1,660 1,920 1,848 1,632 Operating expenses: Selling and marketing............. 775 848 866 919 909 917 979 1,377 Product development and engineering....... 156 179 190 243 212 318 395 305 General and administrative........ 502 560 569 894 672 665 679 920 ------ ------ ------ ------ ------ ------ ------ ------- Total operating expenses............ 1,433 1,587 1,625 2,056 1,793 1,900 2,053 2,602 ------ ------ ------ ------ ------ ------ ------ ------- Loss from operations... (415) (216) (257) (417) (133) 20 (205) (970) Other expense, net..... (83) (85) (57) (27) (82) (73) (38) (67) ------ ------ ------ ------ ------ ------ ------ ------- Net loss................ $ (498) $ (301) $ (314) $ (444) $ (215) $ (53) $ (243) $(1,037) ====== ====== ====== ====== ====== ====== ====== =======
24 The following table sets forth, for the periods indicated, the percentage of net revenues represented by each item in our statement of operations.
Three Months Ended ----------------------------------------------------------------------- March 31, June 30, Sept 30, Dec 31, March 31, June 30, Sept 30, Dec 31 1997 1997 1997 1997 1998 1998 1998 1998 --------- -------- -------- ------- --------- -------- -------- ------ Statement of Operations Data: Net Revenues............ 100% 100% 100% 100% 100% 100% 100% 100% Cost of revenues........ 53 46 48 47 44 40 44 51 ---- ---- ---- ---- ---- ---- ---- ---- Gross profit............ 47 54 52 53 56 60 56 49 Operating expenses: Selling and marketing............. 36 33 33 30 31 28 30 41 Product development and engineering....... 7 7 7 8 7 10 12 9 General and administrative........ 23 22 22 29 23 21 20 28 ---- ---- ---- ---- ---- ---- ---- ---- Total operating expenses............ 66 62 62 67 61 59 62 78 ---- ---- ---- ---- ---- ---- ---- ---- Loss from operations... (19) (8) (10) (14) (5) 0 (6) (29) Other expense, net..... (4) (4) (2) (0) (2) (2) (1) (2) ---- ---- ---- ---- ---- ---- ---- ---- Net loss................ (23)% (12)% (12)% (14)% (7)% (2)% (7)% (31)% ==== ==== ==== ==== ==== ==== ==== ====
In the fourth quarter of 1998, gross profit declined due to increased expenses incurred in connection with our geographic expansion. In addition, during the fourth quarter of 1998, sales and marketing and general and administrative expenses increased as a result of our acquisition of REALBID, LLC and the amortization of intangibles and deferred compensation. The quarterly data should be read in conjunction with the financial statements and the notes to such statements appearing elsewhere in this prospectus. The operating results for any quarter are not necessarily indicative of the operating results for any future period and are subject to significant fluctuation. For further information regarding factors which may impact this fluctuation, please see "Risk Factors--Our quarterly results of operations fluctuate which could cause our stock price to fluctuate." Liquidity And Capital Resources Since our inception, we have financed our operations primarily through the private placement of equity securities, borrowing arrangements and through cash flow from operations. As of December 31, 1998, we had approximately $378,000 in cash and cash equivalents. Our capital requirements depend on numerous factors, including our geographic and product expansions, investments in our Web site and other factors. We have experienced a substantial increase in our capital expenditures and operating expenses since our inception consistent with our growth in operations and staffing, and anticipate that this trend will continue for the foreseeable future. Additionally, we will continue to evaluate possible strategic acquisitions, products and technologies, and we plan to expand our sales and marketing programs and conduct aggressive brand promotions. In September 1996, we entered into a $3.0 million loan agreement with Venture Lending & Leasing, Inc. This agreement provides $1.5 million for fixed asset acquisition and $1.5 million for working capital. Borrowings for fixed asset acquisition are due 48 months from the date of disbursement. Borrowings for working capital are due 36 months from the date of disbursement. This loan agreement requires payment of 8.75% interest during the term and a one-time 15% interest balloon payment is due upon completion of the term. The notes issued under this loan agreement are secured by either all of our fixed assets or all of our business assets. In connection with this loan agreement, we issued to Venture Lending & Leasing, Inc. a warrant to purchase 213,068 shares of our common stock on a pre-split basis at an exercise price of $1.76 per share, subject to antidilutive adjustments. The warrant may be exercised in whole or in part at any time. The warrant expires on September 24, 2003. At December 31, 1998, $541,750 was available for working capital 25 and none is available for fixed asset acquisition. The loan agreement originally was set to expire on June 30, 1998, but was extended during 1998 to June 30, 1999. In February 1999, we entered into an additional $1.8 million loan agreement with Venture Lending & Leasing, Inc. This agreement permits the use of funds for either fixed asset acquisition or working capital. Under this loan agreement, borrowings for fixed assets acquisition are due 48 months from the date of disbursement and borrowings for working capital are due 36 months from the date of disbursement. This loan agreement requires payment of 8.75% interest during the term and a one-time 15% interest balloon payment upon completion of the term. The notes issued under this loan agreement are secured by either all of our fixed assets or all of our business assets. In connection with this loan agreement, we issued a warrant to Venture Lending & Leasing, Inc. This warrant is exercisable for a number of shares determined by a formula based on whether or not we close a new equity financing prior to August 2000. The number of warrant shares will be equal to $225,000 divided by the exercise price, which will be the average of $1.8031 and the per share price of the new equity financing. If no equity financing occurs by August 2000, the warrant will be exercisable for 83,338 shares, on a pre-split basis, at $2.70 per share. The warrant may be exercised in whole or in part at any time. The warrant expires on February 14, 2008. At February 22, 1999, $1.8 million was available under this loan agreement. This loan agreement expires on March 31, 2000. We currently anticipate that the net proceeds of this offering, together with available funds, will be sufficient to meet our anticipated needs until at least the end of 2000. We may need to raise additional funds in the future in order to fund more aggressive brand name promotions or more rapid expansion, to develop new or enhanced services and products, to respond to competitive pressures or to acquire complementary businesses, technologies or services. Additional financing may not be available on terms favorable to us, if at all. If adequate funds are not available or not available on acceptable terms, we may be unable to fund our expansion, successfully promote our brand name, take advantage of unanticipated acquisition opportunities, develop or enhance services and products or respond to competitive pressures. Any such inability could have a material adverse effect on our business. Please see "Risk Factors--We may need additional capital by the end of 2000." Impact of the Year 2000 We have not fully completed tests to assure that our information technology systems will function properly in the year 2000. The computer systems and software programs of many companies and governmental agencies are currently coded to accept or recognize only two digit entries in the date code field. These systems may recognize a date using "00" as the year 1900 rather than the year 2000. As a result, these computer systems and/or software programs may need to be upgraded to comply with such year 2000 requirements or risk system failure or miscalculations causing disruptions of normal business activities. State of Readiness. We have made an assessment of the year 2000 readiness of our information technology systems, including the hardware and software that operate our Web site and our non-information technology systems. We are in the process of a year 2000 simulation to test our information technology systems' readiness which we expect to complete by the end of June 1999. Based on the results of our year 2000 simulation test, we intend to revise our proprietary software as necessary to improve our year 2000 compliance. We believe that substantially all of our applications, databases and infrastructure are year 2000 compliant. We have been informed by many of our vendors of material hardware and software components of our information technology systems that substantially all of the products we use are currently year 2000 compliant. We will request vendors of the material hardware and software components of our information technology systems to provide assurances of their year 2000 compliance. We plan to complete this process during the first half of 1999. We are currently assessing our material non-information technology systems and will seek assurances of year 2000 compliance from providers of these systems. Until such testing is complete and such vendors and providers are contacted, we will not be able to completely evaluate whether our information technology systems or non-information technology systems will need to be revised or replaced. If our efforts to address year 2000 risks are not successful, or if suppliers or other third parties with whom we conduct business do not successfully address such risks, it could have a material adverse effect on our business. 26 Costs. We have identified approximately $300,000 in capital equipment and software that required upgrading or replacement for year 2000 compliance. We expended $150,000 prior to December 31, 1998 and still have an outstanding balance of $150,000 in capital equipment and software to replace. These costs have been included in our operating capital budget. Risks. We are not currently aware of any year 2000 compliance problems relating to our proprietary software or our information technology or non- information technology systems that would have a material adverse effect on our business. We cannot assure that we will not discover year 2000 compliance problems in our proprietary software that will require substantial revisions. In addition, we cannot assure you that third-party software, hardware or services incorporated into our material information technology and non- information technology systems will not need to be revised or replaced, all of which could be time consuming and expensive. Our failure to fix our proprietary software or to fix or replace third-party software, hardware or services on a timely basis could result in lost revenues, increased operating costs, the loss of customers and other business interruptions, any of which could have a material adverse effect on our business. Moreover, the failure to adequately address year 2000 compliance issues in our proprietary software and our information technology and non-information technology systems could result in claims of mismanagement, misrepresentation or breach of contract and related litigation, which could be costly and time-consuming to defend. In addition, we cannot assure you that governmental agencies, utility companies, Internet access companies, third-party service providers and others outside our control will be year 2000 compliant. The failure by such entities to be year 2000 compliant could result in a systemic failure beyond our control, such as a prolonged Internet, telecommunications or electrical failure, which could prevent us from delivering our Web site, could decrease the use of the Internet or prevent users from accessing our Web site, which could have a material adverse effect on our business. Contingency Plan. In the event that year 2000-related problems materialize, we have the ability to revert to a set of manual methods previously utilized in the collection and distribution of data if necessary. We also maintain relationships with several suppliers of services and products to mitigate the risks associated with suppliers who are not year 2000 compliant. Effects of Inflation Due to relatively low levels of inflation in 1996, 1997 and 1998, inflation has not had a significant effect on our results of operations since our inception. Impact of Recently Issued Accounting Standards In June 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 130, Reporting Comprehensive Income (SFAS 130). SFAS 130 requires that all components of comprehensive income, including net income, be reported in financial statements in the period in which they are recognized. SFAS 130 is effective for fiscal years beginning after December 15, 1997. There was no difference between our net loss and our total comprehensive loss for the years ended December 31, 1996, 1997 and 1998. In June 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 131, Disclosures About Segments of an Enterprise and Related Information (SFAS 131). SFAS 131 replaces SFAS 14, Financial Reporting for Segments of a Business Enterprise and changes the way the public companies report segment information. SFAS 131 is effective for fiscal years beginning after December 15, 1997 and has been adopted by us for the year ending December 31, 1998. In March 1998, the American Institute of Certified Public Accountants issued Statement of Position 98-1 Accounting for the Costs of Computer Software Developed or Obtained for Internal Use (SOP 98-1). This standard requires companies to capitalize qualifying computer software costs which are incurred during the 27 application development stage and amortize them over the software's estimated useful life. SOP 98-1 is effective for fiscal years beginning after December 15, 1998. We are currently evaluating the impact of SOP 98-1 on our financial statements and related disclosures. In April 1998, the American Institute of Certified Public Accountants issued Statement of Position 98-5 Reporting for the Costs of Start-Up Activities (SOP 98-5). This standard requires companies to expense the cost of start-up activities and organization costs as incurred. In general, SOP 98-5 is effective for fiscal years beginning after December 15, 1998. We believe the adoption of SOP 98-5 will not have a material impact on our results of operations. In June 1998, the FASB issued SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities. SFAS No. 133 establishes accounting and reporting standards for derivative instruments, including derivative instruments embedded in other contracts, and for hedging activities. SFAS No. 133 is effective for all fiscal quarters of fiscal years beginning after June 15, 1999. The statement is not expected to affect us because we currently do not hold any derivative instruments or conduct any hedging activities. 28 Business This Prospectus may contain forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in any forward-looking statements. Factors that may cause such a difference include, but are not limited to, those discussed in "Risk Factors." Overview We are a leading national provider of confirmed commercial real estate sales information both offline and on the Internet. We have also recently begun leveraging our extensive database to facilitate commercial real estate transactions on the Internet. Over the last 17 years, we have developed a highly evolved data collection and confirmation system to provide information on commercial real estate properties. We believe that we are well-positioned to leverage our extensive database of information to support brokers, lenders and insurers in their sales, finance and insurance transactions involving commercial real estate on the Internet. Industry Background Growth of the Internet The Internet has rapidly become a significant global medium for communications, information and commerce. The Internet enables millions of people worldwide to share information, communicate and conduct business electronically. International Data Corporation estimates that the number of Internet users worldwide exceeded 95 million by the end of 1998, will exceed 170 million by the end of 2000 and will grow to over 319 million by the end of 2002. Growth in Internet usage has been fueled by a number of factors, including: . a large and growing base of personal computers in the workplace and home; . advances in the performance of personal computers and modems; . improvements in network systems and infrastructure; . more readily available and lower cost access to the Internet; . increased awareness of the Internet among businesses and consumers; . increased volume of information and services offered on the Internet; and . reduced security risks involved in conducting transactions on the Internet. Growth in Internet usage is expected to continue as new technologies, such as multimedia capabilities, are developed and adopted, as Internet access and bandwidth increases, and as Internet content improves and becomes more dynamic. The Internet as a New Medium for Business-to-Business Commerce As the Internet has become more accessible and widely used, it has emerged as a primary business channel alongside the telephone, paper-based communication and face-to-face interaction. Forrester Research estimates that businesses bought and sold $43 billion in goods over the Internet last year, as opposed to $8 billion bought by consumers. In addition, they predict that by the year 2003, more than 90% of the projected $1.4 trillion of Internet commerce will be business-to-business related. The Internet allows online providers to efficiently distribute information with the potential for less infrastructure and overhead and greater economies of scale. It also offers customers diverse options and unparalleled convenience. The Commercial Real Estate Industry The commercial real estate industry is large and fragmented. The Federal Reserve has estimated the value of commercial real estate property in the United States to be approximately $3.3 trillion. We estimate that property valued at approximately $285 billion changed ownership in 1998. However, we estimate that no commercial real estate brokerage firm was involved in more than 5% of the value of these transactions. In addition, approximately $200 billion of loans covering commercial real estate properties were written in 1998, approximately half of which were refinancing transactions. 29 Comprehensive and reliable information is a critical component of virtually all commercial real estate transactions. Prior to the availability of confirmed commercial real estate sales information from a centralized source, industry professionals either maintained their own research departments to catalog comparable sales, market statistics and other property-specific information or aggregated such information, to the limited extent available, from multiple third parties. These firms have also traditionally spent significant resources adapting or developing software to analyze such information. These methods have resulted in high internal costs and nonstandard data with varying degrees of comprehensiveness and accuracy. In addition, there are currently no comprehensive, standardized transaction support services that efficiently identify properties and bring together brokers, lenders and insurers in commercial real estate transactions. The lack of such services results in higher internal costs and lost opportunities for brokers, buyers, lenders and insurers. The COMPS.COM Solution The vast information sharing and communications power of the Internet creates an opportunity to improve upon the inefficiencies in conducting commercial real estate transactions. We provide comprehensive and reliable information services, and transaction support products that save industry professionals both time and money. We believe we have established the foundation to be the trusted online resource linking commercial real estate brokers, lenders, appraisers, insurers and other professionals. To date, we have: . Developed a comprehensive and standardized proprietary database. Over the last 17 years, we have developed a highly evolved data collection and confirmation system to provide information on commercial real estate properties. This system is based on a unique combination of our highly trained research staff of over 155 researchers, management practices, proprietary software systems, and computer and communications hardware. To build each of our transaction records, our researchers conduct from 25 to 30 collection and confirmation procedures. We generally confirm property sales over $250,000 within the markets that we cover. Since our inception, we have created a historical database of approximately 400,000 commercial real estate transactions. As a result, we believe that the cost, time and effort involved in replicating our commercial real estate property database should deter competitors from entering into this market and create a significant barrier to entry. . Migrated our database to the Internet. We started out as a paper-based confirmed commercial real estate transaction information service in January 1982. In October 1996, we began to offer our customers the service on CD-ROM, allowing for the computerized manipulation of data to provide more customized reports. In January 1998, we began to offer this service on the Internet. This allows our customers to receive updated commercial real estate transaction information more frequently and analyze the data more quickly and easily. On the date of this prospectus, approximately 27% of our customers use the Internet along with traditional methods when obtaining our services, and approximately 11% use our Internet services exclusively. . Established an Internet-based listing-broker/buyer matching service. We acquired REALBID, LLC in November 1998 in order to offer a listing-broker/buyer matching service to commercial listing-brokers for properties with values exceeding $5 million. As part of the REALBID service, we develop a specific Web site for each listed property using the listing-brokers' summary description. This summary generally includes property information, maps, site plans, pictures, summary financials and broker contact information and also includes a confidentiality agreement. Our comprehensive database allows us to identify and refer potential buyers of listed properties to brokers on REALBID and actively market these properties for brokers using our Internet-based new listing notification system. Our database includes the specific investment criteria of pension fund managers, real estate investment trusts, opportunistic funds, private investors, insurance companies and other potential buyers. In 1998, REALBID was used to support approximately $3.8 billion in commercial real estate transactions. . Introduced a commercial real estate listing service. In January 1999, we introduced our proprietary commercial real estate property listing service, DealPoint, for San Diego County. DealPoint is our 30 Internet-based, commercial listing service enabling brokers to market their properties on the Internet. This form of marketing provides the commercial property broker with an opportunity to increase a property's exposure to prospective buyers and their brokers. Posting may be accomplished by the broker's remote entry or by sending the property information to us for manual entry. During January 1999, more than 500 for-sale commercial properties were posted on the system by brokers in San Diego. Our Business Strategy Our objective is to be the trusted online resource linking commercial real estate brokers, lenders, appraisers, insurers and other professionals by efficiently distributing market information on the Internet. As a resource of commercial real estate market information, we expect to have brokers, lenders, insurers, appraisers and others come to our Web site to transact their business because we can save them time and money. Our business strategy includes the following key elements: . Continue to enhance our comprehensive historical database of commercial real estate transactions. We intend to maintain our position as a leading provider of comprehensive, reliable commercial real estate transaction information. We expect to do this by: (1) expanding our information gathering processes across multiple services and products; (2) using technology to further automate the data collection process; (3) integrating acquired databases into our standardized format; and (4) continually improving our data collection and error detection methods. We believe that these efforts will permit us to build upon our current comprehensive historical database of commercial real estate transactions and maintain the competitive advantages it affords us in our industry. . Expand our online listing-broker/buyer matching network. We intend to expand and enhance the listing-broker/buyer matching services of REALBID by further integrating our REALBID service into our proprietary database. In addition, we plan to increase the number of commercial properties serviced through the REALBID database by including commercial properties with sale prices as low as $1 million. Our comprehensive investor database will allow brokers to more easily identify prospective buyers and our Internet-based new listing notification system allows brokers to more efficiently market commercial properties to such buyers. . Create a comprehensive online national listing service for commercial real estate. We intend to expand the geographic coverage of our online listing service, DealPoint, by soliciting commercial real estate listings throughout the United States. We expect these efforts to result in a comprehensive online national listing service for commercial real estate which will enhance our role in the commercial real estate transaction process. . Enhance our services and products to facilitate online exchange of key commercial real estate market information. We believe that our Web site has the potential to be an online forum for commercial real estate transactions. We believe that commercial real estate industry professionals will be drawn to our Web site because we provide the information necessary to complete transactions. We initially plan to expand our existing services to match lenders, mortgage bankers and brokers with borrowers, followed by matching insurers and agents with property owners and lenders. Combined with our REALBID service, these expanded services will allow buyers and, where applicable, existing property owners, to find the appropriate broker-listed property and arrange financing and insurance coverage for that property from a single source. . Expand into new geographic markets. Since 1995, we have expanded our geographic coverage by establishing commercial real estate information services in 19 new markets through internal expansion and three additional markets through acquisitions. We will continue to establish footholds in new geographic markets by incorporating the commercial real estate sales information obtained through internal development or acquisitions into our database. We plan to expand into new geographic markets using our existing relationships with national customers to gain market acceptance. This strategy will allow us to add new customers and to more effectively service our existing customers, particularly those with national or regional focus. 31 . Continue to build our brand name. We believe that commercial real estate professionals in the markets we serve associate the COMPS brand name with comprehensive, accurate and standardized commercial real estate sales information. We intend to continue building and strengthening our brand name by: (1) maintaining a strong commitment to quality, accuracy and timeliness; (2) increasing our marketing and advertising activities; and (3) continuing to expand our presence on the Internet. We expect these efforts to maintain and build upon the COMPS brand name for quality commercial real estate sales information. Our Proprietary Database Our proprietary database of confirmed commercial real estate sales transactions is the result of 17 years of research. We believe it to be the largest and most sophisticated confirmed sales database covering all categories of commercial real estate properties available today. In 1998, we researched nearly 46,000 transactions totaling approximately $105 billion. Our database is an online information system offering full-color building photographs as well as more than 200 inter-related data fields of information. These data fields include the following current information and key value indicators: . buyers . income and expense information . sellers . building characteristics and . brokerage companies condition . agents . prices per square foot . lenders and mortgages . prices per unit . sales prices . capitalization rates . seller financing . gross income multipliers . property uses or property descriptions Our database covers approximately 400,000 transactions totaling over $466 billion, including 1.8 million acres of land transactions, over 780,000 buyer and seller records and over 300,000 brokerage and agent records. We have developed a highly evolved data collection and confirmation system. This system is based on a unique combination of our highly trained research staff of over 155 researchers supported by management, computer and communications hardware and software systems. Many of our researchers have prior experience in the commercial real estate industry. Our research process includes from 25 to 30 collection and confirmation procedures on every property. We currently cover nine property types: office, industrial, retail, specialty, multi-family, mobile home, residential land, commercial land and industrial land. These property types are further categorized by nearly 150 specific use codes. We also research properties to see if they have one of over 45 detrimental conditions, such as asbestos or earthquake damage. Our proprietary software utilizes over 38 search categories to allow users to search the database efficiently and quickly. This software enables us to provide commercial real estate professionals with specific detailed and comprehensive coverage of virtually every commercial property sale in excess of $250,000 in most of our covered markets. We research real property transfers throughout the country to identify recent commercial property transactions. Typically, we review multiple sources of commercial real estate property information to identify transactions. Once a potential transaction is identified, in order to increase accuracy, our researchers inspect county courthouse records and extract pertinent information directly from the recorded deed into our database. Our researchers match the legal description of the deed with a tax or plat map and then proceed to perform a site inspection on the commercial properties, including land. Our site inspections consist of photographing the building, measuring the building (if necessary), counting parking spaces, assessing property condition and construction and gathering tenant information. Our researchers then continue to ensure the accuracy of our sales data by interviewing buyers, sellers and brokers to confirm that the information we have collected is accurate and to gather additional data pertinent to the property and transaction. Through the telephone confirmation process, we are able to obtain additional property specific details including conditions of the sale, income and expense data and other information not readily available through public records or other traditional data sources. 32 Our Services and Products We have developed advanced information services and products utilizing our proprietary database. In addition, we have acquired and further developed Internet transaction support products. These products use sophisticated Windows-based programs with Internet connectivity to access our database and present information in a variety of formats. Our services are used by brokers, lenders, appraisers, property owners, international accounting firms, tax appeal professionals, public sector agencies, investment banks and many others interested in the valuation of commercial real estate. Internet-Related Information Services Our information services use real-time Internet connectivity for accessing, viewing and reporting information from our proprietary database of confirmed commercial real estate sales transactions. The database contains over 400,000 confirmed sales comparable records in 35 of the top 74 markets in the U.S. . E-COMPS. E-COMPS, introduced in January 1998, provides a comprehensive search engine to access and search our proprietary database. Typically, commercial real estate professionals require the review of between four and seven sales comparable transactions to support a valuation decision. E-COMPS allows the customer to enter multiple search parameters, including location, property type, square footage, price range and number of units. Customers receive a summary report of all relevant properties in our database, including photographs. Customers may also choose to receive more detailed reports. . Pipeline. Pipeline, introduced in September 1998, allows registered customers to search, retrieve, view and print reports of properties in our work-in-process research database which includes unconfirmed and non-arms-length market sales transactions. Customers interested in knowing what the total market consists of, in addition to the confirmed data, use this product. . Spectrum. Spectrum, introduced in August 1998, allows our customers to integrate their data with our proprietary database information, including our sales comparables and for-sale listings. The customer may use the system as an extranet with all of their user locations linked through the Internet to our databases and their internal data housed at our facilities. Spectrum includes easy-to-use query and report writing functions including trend reporting and export features. Spectrum also provides its subscribers access to PRO/FILES property reports. These customized property reports can include confirmed sales and lease comparables, property inspection, demographics and photographs. Transaction Support Products Our Internet-based transaction support products enhance the productivity of industry professionals by deploying information and tools necessary to support the sale, financing and insuring of commercial real estate. . REALBID. REALBID, introduced in 1997 and acquired by us in November 1998, allows our customers to view properties using a listing-broker's summary description. We then identify investors and match them with the property using REALBID's buyer profile database. Commercial listing- brokers can use REALBID as a marketing tool to quickly identify, contact, inform and capture potential investors by notifying them of new listings by e-mail or facsimile. These brokers can also use REALBID to help organize competitive, efficient and orderly sales by leveraging the real-time nature of the Internet. We offer REALBID posting and broadcasting at a fixed fee per property. In 1998, REALBID supported approximately $3.0 billion in commercial real estate transactions. . DealPoint. DealPoint, introduced in January 1999, is our free commercial listing service whereby brokers can effectively market properties on the Internet. This service is currently only available in San Diego County, and we expect to roll it out nationally by the end of 1999 with extensive in-depth listings by the end of 2000. Brokers and prospective buyers use DealPoint to identify the properties for sale that meet their investment needs by selecting relevant search criteria and then viewing selected property information. 33 Products in Development We are currently developing a product that will facilitate the financing of commercial properties by efficiently matching prospective borrowers' loan requirements with lenders' loan products. Prospective borrowers will be able to complete and submit comprehensive applications online to those lenders of choice. We plan to develop products that will facilitate other aspects of commercial real estate transactions, for example the matching of insurers with property owners and lenders. Non-Internet Related We also offer services that do not rely on the Internet as a means of delivery. While these services accounted for more than 90% of our revenue in 1998, we expect the percentage of our revenues represented by these products to diminish as more of our customers transition to using our services and products on the Internet. . COMPS Reports. COMPS Reports, introduced in 1982, is a paper-based service allowing customers to receive confirmed sales comparable reports. . CallCOMPS. CallCOMPS, introduced in 1986, is our phone service allowing customers to license confirmed sales comparable reports on a per use basis. . COMPSLink Windows. COMPSLink Windows, introduced in 1996, is a desktop product which provides access to our proprietary database through data diskette or CD-ROM. COMPSLink Windows allowed us to migrate the customer base from paper to electronic media during 1997 and 1998. Our Customers As of the end of 1998, we had over 4,000 customers, none of which accounted for more than 5% of our revenue. In 1998, our customers included: Arthur Andersen, LLP Grubb & Ellis Bank of America KPMG Peat Marwick, LLP Bankers Trust Co. Los Angeles County Assessor CB Richard Ellis Marcus & Millichap Cushman & Wakefield PricewaterhouseCoopers Deloitte & Touche, LLP Trammell Crow Co. Fannie Mae Union Pacific Corporation Federal Deposit Insurance Corporation Washington Mutual First Nationwide Bank Wells Fargo Bank GMAC World Savings and Loan
Our Sales and Marketing Efforts Sales Our sales efforts have been designed to address the specific market needs of our customers and prospective customers. We use a variety of tools and techniques including: . face-to-face sales calls; . telesales; . direct mail; . seminar marketing; and . contact management software to build a centralized database which is regularly synchronized. 34 Our sales force focuses on subscription services for all products. There are three teams involved in our sales efforts: . Major Account Team. Our major account team is responsible for managing our relationships with a select number of customers and prospects meeting certain pre-defined criteria. Major account representatives are strategically located in key cities across the country in order to serve the needs of our largest and most strategic accounts. Account assignments for this group include many of the country's key brokers, lenders, fee appraisers, tax appeal professionals and governmental entities. . Field Sales Team. We deploy our field sales team in strategic locations across the country in order to meet the specific needs of a local market. Field sales representatives are responsible for managing accounts and prospects in a specific geographic area. . Telesales Team. Our telesales team is located in San Diego and assumes the field sales role in our established western markets. In this capacity, they are also responsible for building and maintaining relationships with a wide variety of subscription customers within a specific geographic area. Additionally, this team provides telephone prospecting and sales support for all markets nationally. When we enter a new market we build a database of key prospects and then execute a market opening campaign. Expansion into new markets is coordinated among all sales teams. Prospects are notified via direct mail and fax followed by a telesales blitz designed to qualify and invite prospects to a seminar launching sales in the market. The seminar is followed by face-to-face sales calls. This local activity is leveraged by agreements with national customers which have been put in place by the major accounts team. The process of opening new markets has been refined as we have expanded and is designed to achieve the fastest possible sales growth. Marketing We use a multi-faceted marketing strategy, leveraging our own research to effectively target both individual professionals and organizations. We employ a combination of personal selling, telesales, online and off-line advertising, direct mail, fax and e-mail programs, public relations and industry trade shows to promote product sales. Off-line advertising is focused on print media specifically concerned with commercial real estate. Print advertising is used to build corporate image, promote new products and announce new geographic coverage. Some vehicles include Commercial Property News, National Real Estate Investor and Real Estate Forum. We use regional real estate and business journals to introduce products and new markets. We also use direct mail, fax and e-mail programs to support new products and market expansion. Through our prospect and customer database, we deliver a highly tailored message directly to those most likely to buy. Mail is used when the message is detailed and color can be used to effectively illustrate the marketing message. E-mail and fax are used when communication needs to be swift and when the message will not suffer because of the lack of resolution or graphics. We augment our database by licensing or purchasing lists and other sources to achieve the most comprehensive database of all users of commercial real estate information and services. In all direct marketing efforts, the Web site is utilized as a marketing tool, to help explain our services. In order to market our Web site, www.comps.com, we: . market to industry associations; . establish relationships with commercial real estate Web sites; . use online advertising to drive traffic to our Web site; and . provide discounts and limited free information to entice potential customers to our Web site. 35 Public relations efforts are both national and regional. We use traditional releases to communicate news regarding our company and to maintain brand awareness. We also use public relations as a tool to educate editors on the type of data we offer and are regarded as an information source by editors. Speaking engagements are also used to communicate the expertise of our staff and quality of our data. Attendance at industry tradeshows and seminars reinforces relationships with our core user groups. We also host our own seminars to promote good use of our products and provide valuable customer service. These venues allow for the in- depth demonstration of our products to highly motivated, captive audiences. Our Markets Our database currently covers the following 35 markets, which represent 102 counties and 48 of the 100 largest U.S. cities: Atlanta Jacksonville Orange County, CA San Francisco Austin Las Vegas Orlando San Jose Baltimore Los Angeles Palm Beach County Seattle Boston Marin-North SF Philadelphia Stockton/Modesto, Chicago Bay Area Phoenix CA Colorado Miami Portland Tampa/Saint Springs New York City- Riverside/San Petersburg Dallas/Fort Manhattan Bernardino, CA Tucson Worth Newark Sacramento Ventura, CA Denver Oakland San Diego Washington, Fort Lauderdale D.C./ (Broward No. Virginia County) Fresno Infrastructure, Operations and Technology Our Web site is hosted by servers located at our facilities in San Diego, California, and is also hosted by UUNET and RealPage. All data and applications are stored and executed from the facilities in San Diego, California. We maintain multiple Internet servers, which run Microsoft Windows NT operating systems and use Microsoft Internet Information Server. We maintain Internet access through UUNET and VERIO. We maintain multiple redundant high-speed connections with each Internet service provider. Compaq multi-processor servers are used to host our Web site. We configure our servers to minimize downtime associated with hardware failures. Additionally, all Internet and database servers have active matching hardware configurations for redundancy. Backups of all servers are run daily and sent weekly to an off-site data storage facility. All servers maintained in our San Diego, California offices are kept in a secured facility with central air conditioning and a centralized UPS system. All Internet traffic is logged and filtered by high performance dedicated firewall servers. An anti-virus scanning solution is used on all computer systems and servers to protect against computer viruses and monitor inbound and outbound e-mail. Nonetheless, our operations are dependent on our ability to protect our facilities and equipment against damage from fire, earthquakes, power loss, water damage, telecommunications failures, vandalism, computer viruses, hacker attacks and other malicious acts, and similar unexpected material adverse events. For further information regarding these issues, please see "Risk Factors--Increased users straining our systems and other systems malfunctions could materially adversely affect our business." We have developed a proprietary custom client/server database application used to capture the revenue generated by our transaction and subscription-based business. The system maintains our list of customers and products and includes an installment-billing module to provide the billing flexibility required by our customers. The resulting revenue transaction details are summarized and fed into our accounting system. Rapidly changing technology, evolving standards, frequent new and upgraded products, and rapid expansion characterize our business. To be successful, we must adapt to our market by continually improving the performance, features, and reliability of our services. 36 Management Systems As we enter new markets, we must integrate new and existing data into our databases. Additionally, we must integrate automated and non-automated controls to manage our data collection process to ensure data integrity. Automated data validation controls are used in both the initial research worksheet application and the final data collection application. These data validation controls ensure data integrity by checking against a valid range of values as soon as data is entered into input screens. These controls eliminate erroneous data in critical fields, such as recorded date, sale price and appraisal values. The controls also ensure the use of industry standard terminology. A final edit check feature ensures the information entered is logically related. Computer and Communications Hardware We maintain 24 Novell and/or Windows NT servers to support our corporate databases, internal applications and Internet services. We also maintain a national high speed internal frame relay network of high speed access to allow remote researchers real-time access to our databases, internal applications and Internet services. All servers are protected by secured firewalls. We also maintain backup drive arrays and inventories of spare parts to minimize potential system downtime. Finally, we store full data backups of servers off- site. We currently keep our main property inventory related databases on Compaq enterprise servers running Microsoft Windows NT. The database management software is Microsoft Server. Databases are replicated on to additional Compaq enterprise servers that are located outside the network firewall. This configuration allows users of our applications to access relevant data without gaining access to internal network systems. We monitor application load balancing across servers and maintain up-to-date copies of primary databases for backup. Software Systems Our software systems have kept pace with the evolution of technology. These systems currently use client server architecture to optimize management of our internal data collection. The custom client server applications facilitate the data collection process. The custom client server applications span the entire data collection process, from initial research to identification of potential records through the collection of verified and value-added information. Our software enables us to continuously enhance the process through: productivity, attaining superior data quality and maintaining data integrity. Additionally, these custom applications allow publication of finalized transactions meeting quality and editing controls. Competition The market for information systems and services is generally competitive and rapidly changing. The market for Internet services and providers is relatively new, intensely competitive and rapidly changing. In the commercial real estate industry, the principal competitive factors are: . quality and depth of the underlying databases; . the proprietary nature of methodologies, databases and technical resources; . the usefulness of the data and reports generated by the software; . effectiveness of marketing and sales efforts; . customer service and support; . compatibility with the customer's existing information systems; . vendor reputation; . price; . timeliness; and . brand loyalty among customers and individual users. 37 We compete directly and indirectly for customers and content providers with the following categories of companies: . publishers and distributors of traditional off-line information services, such as national provider, Realty Information Group, regional providers such as Realty Information Tracking Services, Inc., Databank, Dressco, Inc., Revac, Baca Landata and several smaller local providers, many of which have or may establish Web sites; . online services or Web sites targeted to commercial real estate brokers, buyers and sellers of commercial real estate properties, insurance companies, mortgage brokers and lenders, such as LoopNet, Inc., Commrex, Commercial Search, American Real Estate Exchange, Association of Industrial Realtors, Property Line, CLOAN, Datamerge, A Big Deal.com, Property First, First Realty Advisors, and numerous small regional and local sites; and . public record providers such as Experian, Acxiom DataQuick and TransAmerica, though many of our customers view these public record providers as complementary to our services and often subscribe to one of these services as well as our service. We believe our proprietary database and content compete favorably with our competitors. However, many of our existing competitors, as well as a number of potential new competitors, have longer operating histories in the Internet market, greater name recognition, larger customer bases, greater user traffic and significantly greater financial, technical and marketing resources. Such competitors may be able to undertake more extensive marketing campaigns, adopt more aggressive pricing policies, make more attractive offers to potential employees, subscribers, distribution partners and content providers and may be able to respond more quickly to new or emerging technologies and changes in Internet user requirements. For further information regarding potential competition, please see "Risk Factors--Intense competition may render our services and products uncompetitive or obsolete." Intellectual Property We rely primarily on a combination of copyrights, trademarks, trade secret laws, our subscriber agreements and restrictions on disclosure to protect our intellectual property, such as our proprietary database, software, trademarks, trade names and trade secrets. We enter into agreements with our customers that grant our customers revocable, non-transferable, non-exclusive licenses to use the information and the software on our Web site. These agreements also contain confidentiality provisions and other provisions prohibiting our customers from reproducing the information or software they access on our Web site. We also enter into confidentiality agreements with our employees and consultants, and seek to control access to and distribution of our other proprietary information. Despite these precautions, it may be possible for a third party to copy or otherwise obtain and use the content of our Web site or our other intellectual property without authorization. There can be no assurance that these precautions will prevent misappropriation, infringement or other violations of our intellectual property. A failure to protect our intellectual property in a meaningful manner could have a material adverse effect on our business. In addition, we may need to engage in litigation in order to enforce our intellectual property rights in the future or to determine the validity and scope of the proprietary rights of others. Such litigation could result in substantial costs and diversion of management and other resources, either of which could have a material adverse effect on our business. We also license certain data and content from certain public record providers such as Experian, Acxiom DataQuick and TransAmerica. Experian has agreed to publish a subset of our data as a stand-alone product and to make such data available through its online services. Acxiom DataQuick has granted us a non- exclusive, non-transferable license to their real property ownership data conveyed on magnetic tape or by electronic transmission through any online system. TransAmerica granted us a limited non-exclusive, non-transferable license to use its Metroscan CD-Rom database for certain localities, together with its Metroscan software. 38 We believe that factors such as technical and creative skills of our personnel and ongoing reliable product maintenance and support are critical factors in establishing and maintaining our leadership position in the commercial real estate industry due to the rapid pace of innovation within the software and Internet industries. Employees As of January 31, 1999, we had approximately 246 full-time employees and approximately 50 part-time employees. We have never had a work stoppage and, as of the date of this prospectus, no personnel are represented under collective bargaining agreements. We consider our employee relations to be good. However, for further information regarding employees, please see "Risk Factors--If we are unable to retain key personnel or attract new personnel, it could have a material adverse effect on our business." Facilities Our principal administrative, sales, marketing, research and product development facilities are located in approximately 33,217 square feet of office space in San Diego, California. We lease our facility from a limited partnership whose general partner is a company owned by Mr. Crane, our President, Chief Executive Officer and Chairman of the Board. In addition, Mr. Beasley, one of our directors, is a limited partner of the limited partnership from which we lease our facilities. Our lease is for a five-year term commencing in February 1999 with five two-year extension options. For further information regarding this transaction, please see "Certain Relationships and Related Transactions." We also rent office space in Burlingame, California, Phoenix, Arizona, and Vienna, Virginia. We believe our current facilities will be adequate to meet our needs for the foreseeable future. However, please see "Risk Factors--Increased users straining our systems and other systems malfunctions could materially adversely affect our business," for further information regarding our facilities. Legal Proceedings As of the date of this prospectus, we are not a party to any material legal proceedings. 39 Management Executive Officers and Directors Set forth below is the name, age, position and a brief account of the business experience of each of our executive officers and directors.
Name Age Position ---------------------------- --- -------------------------------------------- Christopher A. Crane........ 47 Chairman of the Board, Chief Executive Officer and President Emmett R. DeMoss, Jr. ...... 62 Vice President and Chairman of REALBID Division Walter W. Papciak........... 60 Executive Vice President of Sales, Marketing and Product Development Michael Arabe............... 52 Senior Vice President of Sales Craig S. Farrington......... 40 Vice President of Product Marketing and Development Karen Goodrum............... 41 Vice President of Finance and Administration and Chief Financial Officer and Secretary Joseph A. Mannina........... 34 Vice President of Operations Robert C. Beasley (2)....... 61 Director Gregory M. Avis (1)(2)...... 40 Director Kenneth F. Potashner 41 Director (1)(2).....................
- -------- (1) Member of the compensation committee. (2) Member of the audit committee. Christopher A. Crane has served as our President, Chief Executive Officer and Chairman of the Board since August 1992. Prior to joining us, Mr. Crane served as Group President and a director of Nitches, Inc., an apparel company, and as Vice President of Corporate Development for Oster Communications, Inc., an international financial database publishing company. Mr. Crane received his B.S. in finance summa cum laude from Boston College and his M.B.A. from Harvard University. Emmett R. DeMoss, Jr. has served as our Vice President and Chairman of our REALBID division since November 1998. In October 1994, Mr. DeMoss co-founded REALBID, LLC, an Internet marketing services company specializing in transactional support of high-end commercial property sales, and from June 1997 until November 1998, Mr. DeMoss served as a Manager of REALBID, LLC. From October 1993 until September 1994, Mr. DeMoss served as President of Ironstone Company, a real estate tax appeal service. Mr. DeMoss previously served for over 10 years in a number of senior executive positions with Grubb & Ellis, a real estate brokerage and property management firm, including Executive Vice President, Chief Operating Officer, Senior Vice President, Chief Financial Officer and as a director. Mr. DeMoss received his B.S. in engineering from Princeton University and his M.B.A. from Stanford Business School. Walter W. Papciak has served as our Executive Vice President of Sales, Marketing and Product Development since August 1995. From October 1994 until July 1995 Mr. Papciak served as Executive Vice President of QED, Inc., an education database company. From May 1994 until September 1994, Mr. Papciak worked as a consultant on various internet and database projects. From January 1985 until April 1994, Mr. Papciak was Senior Vice President of Computer Intelligence, the computer and communications industry research and market information division of Ziff-Davis. Mr. Papciak received his B.S. in physics and his M.B.A. in information systems from Wayne State University. Michael Arabe has been one of our senior executives since 1989 and has served as our Senior Vice President of Sales since January 1996. Prior to joining us, Mr. Arabe was a sales executive with Celluland, Inc. Mr. Arabe received his B.S. in economics from Louisiana State University. Craig S. Farrington has served as our Vice President of Product Marketing and Development since September 1996 . Mr. Farrington previously served as Vice President of our CallCOMPS division from January 1993 until August 1996 and has held various other positions with us since 1983. Mr. Farrington received his B.A. in business and economics from Westmont College. 40 Karen Goodrum has served as our Vice President of Finance and Administration since September 1993 and our Chief Financial Officer since January 1997 and our Secretary since February 1999. Ms. Goodrum previously served as our Vice President and Controller from October 1988 until August 1993. Ms. Goodrum received her B.A. in education from the University of Maryland and her M.B.A. from San Diego State University. Joseph A. Mannina has served as our Vice President of Operations since August 1998. Mr. Mannina previously served as our Director of East Coast Operations from January 1994 until July 1998 and has served in various other positions at COMPS since 1988. Mr. Mannina received his B.S. in economics from the University of California, Berkeley. Robert C. Beasley is our founder and has served as as one of our directors since August 1992. Mr. Beasley previously served as our Secretary from October 1984 until February 1989. Mr. Beasley founded COMPS, Inc., our predecessor, in December 1981 and served as its President from December 1981 until March 1992. Mr. Beasley has over 34 years of experience in commercial real estate as a broker, researcher, lender and developer. Mr. Beasley received his B.A. in Business Administration from Claremont McKenna College. He also graduated from Westminster Theological Seminary. Gregory M. Avis has served as one of our directors since October 1994. Mr. Avis is currently a Managing General Partner of Summit Partners, a private venture capital firm, and has held various positions at Summit Partners since 1984. Mr. Avis received his B.A. in political economics cum laude from Williams College and his M.B.A. with distinction from Harvard Business School. Kenneth F. Potashner has served as one of our directors since February 1999. Since November 1998, Mr. Potashner has served as the Chief Executive Officer of S3 Incorporated, a manufacturer of embedded graphics accelerator chips. Since April 1996, Mr. Potashner has served as the Chairman of the Board of Directors of Maxwell Technologies, Inc., a developer of pulse power technologies. From April 1996 until November 1998, Mr. Potashner served as the President, Chief Executive Officer and Chief Operating Officer of Maxwell Technologies. From November 1994 to April 1996, Mr. Potashner served as Executive Vice President of Operations of Conner Peripherals, a designer and manufacturer of information storage solution products for computer applications. From March 1991 to October 1994, Mr. Potashner was Vice President of Product Engineering for Quantum Corporation, a designer and manufacturer of hard drives for computer systems. Mr. Potashner received his B.S.E.E. from Lafayette College and his M.S.E.E. from Southern Methodist University. Other Key Employees Set forth below is the name, age, position and a brief account of the business experience of certain of our other key employees.
Name Age Position --------------------------------- --- --------------------------------------- Christopher T. Fenton............ 43 Vice President of Corporate Development Vice President of Commercial Listing Herbert D. Steele................ 55 Services Lori Reisinger................... 37 Regional Vice President Vicki Ridley..................... 35 Regional Vice President Assistant Vice President of Product Robert Evatt..................... 42 Development Assistant Vice President of Information Donald Ward...................... 37 Technology Robert A. Potter, Jr. ........... 44 President of REALBID Division
Christopher T. Fenton has served as our Vice President of Corporate Development since August 1998. Mr. Fenton also served as our Vice President of Operations from June 1990 until July 1998 and held various other positions with us since 1985. Mr. Fenton received his B.S. in finance magna cum laude from San Diego State University. 41 Herbert D. Steele has served as our Vice President of Commercial Listing Services since June 1998. From April 1996 until May 1998, Mr. Steele was Executive Vice President of REAL USA, LLC, an online, subscription-based national listing service for commercial real estate. From November 1991 until March 1996, Mr. Steele served as Executive Vice President of The Carlson Company, an asset and property management company. Prior to that Mr. Steele founded The Cornerstone Corporation, a commercial mortgage brokerage company, and served as its President. Mr. Steele received his B.A. in english literature from Duke University and his M.B.A. from the University of Connecticut. Lori Reisinger has served as our Regional Vice President in Burlingame, California since July 1994. Ms. Reisinger has held various positions with us since 1986. Ms. Reisinger received her B.A. in political science from Southern Oregon State College. Vicki Ridley has served as our Regional Vice President in Phoenix, Arizona since April 1997. Ms. Ridley has held various positions with us since 1987. Ms. Ridley received her B.A. in finance from Arizona State University. Robert Evatt has served as our Assistant Vice President of Product Development since May 1996. From August 1986 until May 1996, Mr. Evatt was Assistant Vice President of Product Development for Equifax National Decision Systems, an information company. Mr. Evatt received his B.A. in geography from the University of Arizona and his M.S. in urban planning from the University of Washington. Donald Ward has served as our Assistant Vice President of Information Technology since March 1997. From October 1993 until March 1997, Mr. Ward was the director of Technical Services for Equifax National Decision Systems, an information company. Mr. Ward attended New Mexico State University and the University of Texas. Robert A. Potter, Jr. has served as President of our REALBID Division since we acquired REALBID in November 1998. In June 1992, Mr. Potter co-founded REALBID, LLC and from June 1992 until November 1998, Mr. Potter served as a Manager of REALBID, LLC. From January 1990 until December 1996, Mr. Potter served as Vice President, Pacific Rim Country Manager and Western Regional Manager for MBIA, a credit enhancement company. Mr. Potter received his B.A. in history from Santa Clara University and his M.B.A. from the University of California, Berkeley. Classes of the Board Our board currently has four members. Under our bylaws, beginning at our next annual meeting of stockholders, our board will be divided into two classes of directors serving staggered two-year terms, with one class of directors to be elected at each annual meeting of stockholders. Board Committees The audit committee of the board of directors was established in November 1997 and reviews, acts on and reports to the board of directors with respect to various auditing and accounting matters, including the recommendation of our auditors, the scope of the annual audits, fees to be paid to the auditors, the performance of our independent auditors and our accounting practices. The members of the audit committee are Messrs. Avis, Beasley and Potashner. The compensation committee of the board of directors was established in November 1994 and recommends, reviews and oversees the salaries, benefits and stock option plans for our employees, consultants, directors and other individuals compensated by us. The compensation committee also administers our compensation plans. The members of the compensation committee are Messrs. Avis and Potashner. 42 Director Compensation We reimburse our directors for the reasonable expenses of attending the meetings of the board of directors or committees. Under our 1999 stock incentive plan, each individual who first becomes a non-employee member of the board of directors at any time after the completion of this offering will receive an option to purchase 12,000 shares of common stock on a pre-split basis on the date such individual joins the board of directors, provided such individual has not previously been employed by us or any parent or subsidiary corporation. In addition, on the date of each annual stockholders' meeting, beginning in 2000, each non-employee member of the board of directors will automatically be granted an option to purchase 2,000 shares of common stock on a pre-split basis, provided such individual has served as a non-employee member of the board of directors for at least six months. Please see "--Benefit Plans." Upon Mr. Potashner's election to the board in February 1999, our board granted Mr. Potashner options to purchase 32,500 shares of our common stock, on a pre-split basis, at an exercise price of $8.20 per share. The options vest on a yearly basis in equal installments over a four-year period and are exercisable for a 10 year term following the grant date. Compensation Committee Interlocks and Insider Participation Our compensation committee currently consists of Messrs. Avis and Potashner. Neither member of the compensation committee has been an officer or employee of us at any time. None of our executive officers serves as a member of the board of directors or compensation committee of any other company that has one or more executive officers serving as a member of our board of directors or compensation committee. Prior to the formation of the compensation committee in November 1994, the board of directors as a whole made decisions relating to compensation of our executive officers. Mr. Crane participated in all such discussions and decisions, except those regarding his own compensation. Employment and Severance Arrangements Most of our current employees have entered into agreements with us which contain certain restrictions and covenants. These provisions include covenants relating to the protection of our confidential information, the assignment of inventions, and restrictions on competition and soliciting our clients, employees, or independent contractors. In November 1994, we entered into employment agreements with each of Messrs. Arabe and Farrington, and in August 1995, we entered into an employment agreement with Mr. Papciak. Under these agreements, each of these employee's base salary may be increased or decreased from time-to-time, in the sole discretion of our management. Each such employee is also eligible to receive an incentive bonus determined by our compensation committee. If any of these employees is terminated for reasons other than good cause, he will be entitled to receive six months' salary and a pro-rata portion of his incentive bonus. In October 1994, we entered into an employment agreement with Mr. Crane. Under this agreement, Mr. Crane's base salary may be increased or decreased from time-to-time, in the sole discretion of our compensation committee. Mr. Crane is also eligible to receive an incentive bonus determined by our compensation committee. If Mr. Crane's employment is terminated for reasons other than good cause, he will be entitled to receive eight months' salary and a pro-rata portion of his incentive bonus. In November 1994, we entered into an employment with Ms. Goodrum. Under this agreement, Ms. Goodrum's base salary may be increased or decreased from time- to-time, at our sole discretion. Ms. Goodrum is also eligible to receive an incentive bonus. If Ms. Goodrum is terminated for reasons other than good cause, then she will be entitled to receive six months' salary and a pro-rata portion of her incentive bonus. We may terminate any of these employees at any time. For specific salary information in connection with our employment arrangements with the above individuals, please see "Management--Executive Compensation." 43 In addition, the compensation committee as plan administrator of our 1999 stock incentive plan will have the authority to grant options and to structure repurchase rights under that plan so that the shares subject to those options or repurchase rights will immediately vest in connection with a change in control of us (whether by merger, asset sale, successful tender offer for more than 50% of the outstanding voting stock or by a change in the majority of the board by reason of one or more contested elections for board membership), with such vesting to occur either at the time of such change in control or upon the subsequent involuntary termination of the individual's service within a designated period (not to exceed 18 months) following such change in control. Executive Compensation The following table sets forth all compensation received during the year ended December 31, 1998 by our Chief Executive Officer and our other four executive officers whose salary and bonus exceeded $100,000 in 1998 for services rendered in all capacities to us during 1998. "All other compensation" represents matching payments under our 401(k) plan. All share numbers below are calculated prior to a stock split of to , which is subject to stockholder approval. Summary Compensation Table
Long-Term Annual Compensation Compensation Awards ---------------- ------------ Shares Underlying All Other Name and Principal Position Salary Bonus Options/SARs Compensation - --------------------------- -------- ------- ------------ ------------ Christopher A. Crane................ $150,000 $65,000 -- $1,500 Chairman of the Board, Chief Executive Officer and President Walter W. Papciak................... 150,000 22,653 9,000 -- Executive Vice President of Sales, Marketing and Product Development Michael Arabe....................... 129,887 5,764 18,000 974 Senior Vice President of Sales Craig S. Farrington................. 102,240 9,790 -- 850 Vice President of Product Marketing and Development Karen Goodrum....................... 81,167 21,500 -- 615 Vice President of Finance and Administration and Chief Financial Officer
44 Option Grants in Last Fiscal Year The following table sets forth certain information regarding options granted to our executive officers listed in the Summary Compensation Table during the fiscal year ended December 31, 1998. We have not granted any stock appreciation rights. Each option represents the right to purchase one share of common stock. The options shown in this table are all incentive stock options granted pursuant to our stock option plans. The options become exercisable at a rate of 20% per year. To the extent not already exercisable, certain of these options may also accelerate and become exercisable in the event of a merger in which we are not the surviving corporation or upon the sale of substantially all of our assets. Please see "--Benefit Plans" for more details regarding these options. In the year ended December 31, 1998, we granted options to purchase an aggregate of 1,559,199 shares of common stock. This share number and all share numbers below are calculated prior to a stock split of to , which is subject to stockholder approval. Option Grants In Last Fiscal Year
Potential Realizable Individual Grants Value at Assumed --------------------------------------------- Annual Rates Of Number of % of Total Stock Price Securities Options/SARs Appreciation Underlying Granted to For Option Term Options/SARs Employees In Exercise Expiration --------------------- Name Granted 1998 Price Date 5% 10% - ---- ------------ ------------ -------- ---------- ---------- ---------- Christopher A. Crane.... -- -- -- -- -- -- Walter W. Papciak....... 9,000 * $0.45 02/11/08 $ 2,547 $ 6,455 Michael Arabe........... 18,000 1.15% 1.00 06/29/08 11,320 28,687 Craig S. Farrington..... -- -- -- -- -- -- Karen Goodrum........... -- -- -- -- -- --
- -------- * Less than 1% of total The potential realizable value at assumed annual rates of stock price appreciation for the option term represents hypothetical gains that could be achieved for the respective options if exercised at the end of the option term. The 5% and 10% assumed annual rates of compounded stock price appreciation are mandated by rules of the Securities and Exchange Commission and do not represent our estimate or projection of our future common stock prices. These amounts represent certain assumed rates of appreciation in the value of our common stock from the fair market value on the date of grant. Actual gains, if any, on stock option exercises are dependent on the future performance of the common stock and overall stock market conditions. The amounts reflected in the table may not necessarily be achieved. 45 Aggregated Option Exercises in the Year Ended December 31, 1998 and Year-End Option Values The following table sets forth certain information concerning the number and value of unexercised options held by each of the executive officers listed in the Summary Compensation Table at December 31, 1998. These option share numbers reflect the full acceleration of the vesting schedule of certain options upon completion of this offering and do not reflect a for stock split. None of these executive officers exercised options to purchase common stock during the year ended December 31, 1998.
Number of Securities Underlying Unexercised Value of Unexercised Options at In-the-Money Options December 31, 1998 at December 31, 1998 ------------------------- ------------------------- Name Exercisable Unexercisable Exercisable Unexercisable - ---- ----------- ------------- ----------- ------------- Christopher A. Crane........ -- -- -- -- Walter W. Papciak........... 67,200 31,800 $ $ Michael Arabe............... 67,200 40,800 Craig S. Farrington......... 67,200 22,800 Karen Goodrum............... 67,200 22,800
There was no public trading market for the common stock as of December 31, 1998. Accordingly, the value of unexercised in-the-money options listed above has been calculated on the basis of the assumed initial public offering price of $ per share, less the applicable exercise price per share, multiplied by the number of shares underlying such options. Benefit Plans 1999 Stock Incentive Plan Our 1999 stock incentive plan is intended to serve as the successor equity incentive program to our amended and restated stock option plan, 1998 supplemental option plan, and 1998 equity participation plan. Our 1999 stock incentive plan was adopted by the board and stockholders in February 1999. Our 1999 stock incentive plan will become effective on the date the underwriting agreement is signed in connection with this offering of our common stock. All outstanding options under the predecessor plans will be incorporated into our 1999 stock incentive plan on the date this plan is effective, and no further option grants will be made under the predecessor plans after such date. The incorporated options will continue to be governed by their existing terms, unless the plan administrator elects to extend one or more features of our 1999 stock incentive plan to those options. Except as otherwise noted below, the incorporated options will have substantially the same terms as in effect for grants made under the discretionary option grant program of our 1999 stock incentive plan. All share numbers below regarding our 1999 employee stock purchase plan are calculated prior to a stock split of to , which is subject to stockholder approval. An initial reserve of 2,800,000 shares of common stock has been authorized for issuance under our 1999 stock incentive plan. Such share reserve consists of (1) approximately the number of shares which will remain available for issuance under the predecessor plans on the date our 1999 stock incentive plan becomes effective, including the shares subject to outstanding options thereunder, plus (2) an additional increase of approximately 51,417 shares. The number of shares of common stock reserved for issuance under our 1999 stock incentive plan will automatically increase on the first trading day in January each calendar year, beginning in calendar year 2000, by an amount equal to 2.5% of the total number of shares of common stock outstanding on the last trading day in December of the preceding calendar year, but in no event will any such annual increase exceed 500,000 shares. In addition, no participant in our 1999 stock incentive plan may be granted stock options, separately exercisable stock appreciation rights and direct stock issuances for more than 700,000 shares of common stock in the aggregate per calendar year. Our 1999 stock incentive plan is divided into five separate components: (1) the discretionary option grant program under which eligible individuals in our employ or service (including officers, non-employee board members and consultants) may, at the discretion of the plan administrator, be granted options to purchase shares of common stock at an exercise price not less than 100% of the fair market value of those shares on the 46 grant date, (2) the stock issuance program under which such individuals may, in the plan administrator's discretion, be issued shares of common stock directly, through the purchase of such shares at a price not less than 100% of their fair market value at the time of issuance or as a bonus tied to the performance of services, (3) the salary investment option grant program which may, at the plan administrator's sole discretion, be activated for one or more calendar years and, if so activated, will allow executive officers and other highly compensated employees the opportunity to apply a portion of their base salary to the acquisition of special below-market stock option grants, (4) the automatic option grant program under which option grants will automatically be made at periodic intervals to eligible non-employee board members to purchase shares of common stock at an exercise price equal to 100% of the fair market value of those shares on the grant date and (5) the director fee option grant program which may, in the plan administrator's sole discretion, be activated for one or more calendar years and, if so activated, will allow non-employee board members the opportunity to apply a portion of the annual retainer fee otherwise payable to them in cash each year to the acquisition of special below-market option grants. The discretionary option grant program and the stock issuance program will be administered by the compensation committee. The compensation committee as plan administrator will have complete discretion to determine which eligible individuals are to receive option grants or stock issuances under those programs, the time or times when such option grants or stock issuances are to be made, the number of shares subject to each such grant or issuance, the status of any granted option as either an incentive stock option or a non- statutory stock option under the federal tax laws, the vesting schedule to be in effect for the option grant or stock issuance and the maximum term for which any granted option is to remain outstanding. However, the board acting by disinterested majority will have the exclusive authority to make any discretionary option grants or stock issuances to members of the compensation committee. The compensation committee will also have the exclusive authority to select the executive officers and other highly compensated employees who may participate in the salary investment option grant program in the event that program is activated for one or more calendar years. Neither the compensation committee nor the board will exercise any administrative discretion with respect to option grants under the salary investment option grant program or under the automatic option grant or director fee option grant program for the non-employee board members. All grants under those latter three programs will be made in strict compliance with the express provisions of each such program. The exercise price for the shares of common stock subject to option grants made under our 1999 stock incentive plan may be paid in cash or in shares of common stock valued at fair market value on the exercise date. The option may also be exercised through a same-day sale program without any cash outlay by the optionee. In addition, the plan administrator may provide financial assistance to one or more optionees in the exercise of their outstanding options or the purchase of their unvested shares by allowing such individuals to deliver a full-recourse, interest-bearing promissory note in payment of the exercise price and any associated withholding taxes incurred in connection with such exercise or purchase. The plan administrator will have the authority to effect the cancellation of outstanding options under the discretionary option grant program, including options incorporated from the predecessor plans, in return for the grant of new options for the same or different number of option shares with an exercise price per share based upon the fair market value of our common stock on the new grant date. Stock appreciation rights are authorized for issuance under the discretionary option grant program. Such rights will provide the holders with the election to surrender their outstanding options for an appreciation distribution from us equal to the excess of (1) the fair market value of the vested shares of common stock subject to the surrendered option over (2) the aggregate exercise price payable for those shares. Such appreciation distribution may be made in cash or in shares of common stock. None of the incorporated options from the predecessor plans contain any stock appreciation rights. In the event that we are acquired by merger or asset sale, each outstanding option under the discretionary option grant program which is not to be assumed by the successor corporation will automatically accelerate in full, and all unvested shares under the discretionary option grant and stock issuance programs will immediately vest, except to the extent our repurchase rights with respect to those shares are to be assigned to the successor 47 corporation. The plan administrator will have complete discretion to grant one or more options under the discretionary option grant program which will become fully exercisable for all the option shares in the event those options are assumed in the acquisition and the optionee's service with us or the acquiring entity involuntarily terminates within a designated period not exceeding 18 months following such acquisition. The vesting of outstanding shares under the stock issuance program may be accelerated upon similar terms and conditions. The plan administrator will also have the authority to grant options which will immediately vest upon an acquisition of us, whether or not those options are assumed by the successor corporation. The plan administrator is also authorized under the discretionary option grant and stock issuance programs to grant options and to structure repurchase rights so that the shares subject to those options or repurchase rights will immediately vest in connection with a change in ownership or control of us, whether this change in ownership or control is by a successful tender offer for more than 50% of the outstanding voting stock or by a change in the majority of the board by reason of one or more contested elections for board membership. Such accelerated vesting may occur either at the time of such change or upon the subsequent involuntary termination of the individual's service within a designated period (not to exceed 18 months) following such change in control. The options incorporated from the predecessor plans may, in the plan administrator's discretion, immediately vest in the event of (1) our merger or consolidation, or (2) the acquisition by another corporation or person of all or substantially all of our assets or 80% or more of our then outstanding voting stock, unless those options are assumed or substituted in the acquisition of us. The plan administrator will have the discretion to extend the acceleration provisions of our 1999 stock incentive plan to any or all of the options outstanding under the predecessor plans. In the event the plan administrator elects to activate the salary investment option grant program for one or more calendar years, each of our executive officers and other highly compensated employees selected for participation may elect, prior to the start of the calendar year, to reduce his or her base salary for that calendar year by a specified dollar amount not less than $10,000 nor more than $50,000. Each selected individual who files such a timely election will automatically be granted, on the first trading day in January of the calendar year for which that salary reduction is to be in effect, a non- statutory option to purchase that number of shares of common stock determined by dividing the salary reduction amount by two-thirds of the fair market value per share of common stock on the grant date. The option will be exercisable at a price per share equal to one-third of the fair market value of the option shares on the grant date. As a result, the total spread on the option shares at the time of grant (the fair market value of the option shares on the grant date less the aggregate exercise price payable for those shares) will be equal to the amount of salary invested in that option. The option will vest and become exercisable in a series of 12 equal monthly installments over the calendar year for which the salary reduction is to be in effect and will be subject to full and immediate vesting upon certain changes in the ownership or control of us. Under the automatic option grant program, each individual who first becomes a non-employee board member at any time after the completion of this offering will automatically receive an option grant for 12,000 shares on the date such individual joins the board, provided such individual has not been in our prior employ. In addition, on the date of each annual stockholders meeting held after the completion of this offering, each non-employee board member who is to continue to serve as a non-employee board member will automatically be granted an option to purchase 2,000 shares of common stock, provided such individual has served on our board for at least six months. Each automatic grant will have a term of 10 years, subject to earlier termination following the optionee's cessation of board service. The option will be immediately exercisable for all of the option shares; however, any unvested shares purchased under the option will be subject to repurchase by us, at the exercise price paid per share, should the optionee cease board service prior to vesting in those shares. The shares subject to each 12,000-share automatic option grant will vest in a series of eight successive equal semi- annual installments upon the individual's completion of each six-month period of board service over the four-year period measured from the option grant date. Each 2,000-share automatic option grant will vest in two successive equal semi- 48 annual installments upon the individual's completion of each six month period of board service over the one year period measured from the option grant date. However, the shares subject to each automatic grant will immediately vest in full upon certain changes in control or ownership of us or upon the optionee's death or disability while a board member. Should the director fee option grant program be activated in the future, each non-employee board member will have the opportunity to apply all or a portion of any annual retainer fee otherwise payable in cash to the acquisition of a below-market option grant. The option grant will automatically be made on the first trading day in January in the year for which the retainer fee would otherwise be payable in cash. The option will have an exercise price per share equal to one-third of the fair market value of the option shares on the grant date, and the number of shares subject to the option will be determined by dividing the amount of the retainer fee applied to the program by two-thirds of the fair market value per share of common stock on the grant date. As a result, the total spread on the option (the fair market value of the option shares on the grant date less the aggregate exercise price payable for those shares) will be equal to the portion of the retainer fee invested in that option. The option will vest and become exercisable for the option shares in a series of 12 equal monthly installments over the calendar year for which the election is to be in effect. However, the option will become immediately exercisable and vested for all the option shares upon (1) certain changes in the ownership or control of us or (2) the death or disability of the optionee while serving as a board member. The shares subject to each option under the salary investment option grant, automatic option grant and director fee option grant programs will immediately vest upon (1) an acquisition of us by merger or asset sale or (2) the successful completion of a tender offer for more than 50% of our outstanding voting stock or a change in the majority of the board effected through one or more contested elections for board membership. Limited stock appreciation rights will automatically be included as part of each grant made under the automatic option grant, salary investment option grant and director fee option grant programs and may be granted to one or more of our officers as part of their option grants under the discretionary option grant program. Options with such a limited stock appreciation right may be surrendered to us upon the successful completion of a hostile tender offer for more than 50% of our outstanding voting stock. In return for the surrendered option, the optionee will be entitled to a cash distribution from us in an amount per surrendered option share equal to the excess of (1) the highest price per share of common stock paid in connection with the tender offer over (2) the exercise price payable for such share. The board may amend or modify our 1999 stock incentive plan at any time, subject to any required stockholder approval. Our 1999 stock incentive plan will terminate on the earliest of (1) February 18, 2009, (2) the date on which all shares available for issuance under our 1999 stock incentive plan have been issued as fully-vested shares or (3) the termination of all outstanding options in connection with certain changes in control or ownership of us. 1999 Employee Stock Purchase Plan Our 1999 employee stock purchase plan was adopted by the board and stockholders in February 1999 and will become effective immediately upon the execution of the underwriting agreement for this offering. Our employee stock purchase plan is designed to allow our eligible employees to purchase shares of common stock, at semi-annual intervals, through their periodic payroll deductions under our employee stock purchase plan. All share numbers below regarding our 1999 employee stock purchase plan are calculated prior to a stock split of to , which is subject to stockholder approval. An initial reserve of 300,000 shares of common stock has been authorized for issuance under our employee stock purchase plan. The number of shares of common stock reserved for issuance under our employee stock purchase plan will automatically increase on the first trading day in January each calendar year, beginning in calendar year 2000, by an amount equal to 2% of the total number of shares of common stock outstanding on the last trading day in December of the preceding calendar year, but in no event will any such annual increase exceed 300,000 shares. Our employee stock purchase plan will be implemented in a series of 49 successive offering periods, each with a maximum duration for 24 months. However, the initial offering period will begin on the execution date of the underwriting agreement and will end on the last business day in July 2001. The next offering period will commence on the first business day in August 2001, and subsequent offering periods will commence as designated by the plan administrator. Individual employees who are scheduled to work more than 20 hours per week for more than 5 calendar months per year on the start date of any offering period may enter our employee stock purchase plan on that start date or on the first business day of February or August after that start date. Individuals who become eligible employees after the start date of the offering period may join our employee stock purchase plan on any subsequent semi-annual entry date within that offering period. Payroll deductions may not exceed 10% of the participant's cash earnings, and the accumulated payroll deductions of each participant will be applied to the purchase of shares on his or her behalf on the last business day in January and July each year at a purchase price per share equal to 85% of the lower of (1) the fair market value of the common stock on the participant's entry date into the offering period or (2) the fair market value on the semi-annual purchase date. In no event, however, may any participant purchase more than 1,500 shares on any semi-annual purchase date nor may all participants in the aggregate purchase more than 75,000 shares on any such semi-annual purchase date. Should the fair market value per share of common stock on any purchase date be less than the fair market value per share on the start date of the two-year offering period, then that offering period will automatically terminate, and a new two-year offering period will begin on the next business day, with all participants in the terminated offering to be automatically transferred to the new offering period. In the event we are acquired by merger or asset sale, all outstanding purchase rights will automatically be exercised immediately prior to the effective date of such acquisition. The purchase price will be equal to 85% of the lower of (1) the fair market value per share of common stock on the participant's entry date into the offering period in which such acquisition occurs or (2) the fair market value per share of common stock immediately prior to such acquisition. Our employee stock purchase plan will terminate on the earlier of (1) the last business day of July 2009 (2) the date on which all shares available for issuance under our employee stock purchase plan shall have been sold pursuant to purchase rights exercised thereunder or (3) the date on which all purchase rights are exercised in connection with an acquisition of us by merger or asset sale. The board may at any time alter, suspend or discontinue our employee stock purchase plan. However, certain amendments to our employee stock purchase plan may require stockholder approval. 50 Certain Relationships and Related Transactions Certain Sales of Securities We have issued the following securities in private placement transactions: 4,270,336 shares of Series A preferred stock and Class B common stock warrants exercisable for 379,869 shares for an aggregate price of $5,000,000 in October 1994; and 637,790 shares of Series B preferred stock, Class A common stock warrants exercisable for 37,329 shares and Class B common stock warrants exercisable for 306,097 shares for an aggregate price of $1,150,000 in February 1998. These numbers do not reflect the for stock split. The purchasers of such securities include, among others, the following executive officers, directors and holders of more than 5% of our outstanding stock and their affiliates:
Preferred Stock Warrants Executive Officer, Directors ------------------ --------------- Total and 5% Stockholders Series A Series B Class A Class B Consideration ---------------------------- --------- -------- ------- ------- ------------- Christopher A. Crane......... -- 69,325 37,329 -- $ 125,000 Funds Affiliated with Summit Partners(1)................. 4,270,336 554,600 -- 678,500 $6,000,000
- -------- (1) Includes Summit Ventures III, L.P. and Summit Investors II, L.P. Mr. Avis, one of our directors, is a general partner of Stamps, Woodsum & Co. III, a general partner of Summit Partners III, L.P. Summit Partners III, L.P. is the general partner of Summit Ventures III, L.P. Mr. Avis is also a general partner of Summit Investors II, L.P. For additional information regarding the sale of securities to executive officers, directors and stockholders of more than 5% of our outstanding common stock, please see "Principal and Selling Stockholders." Holders of outstanding preferred stock and common stock issuable upon exercise of warrants are entitled to certain registration rights with respect to the common stock issued or issuable upon conversion or exercise of such preferred stock or warrants. Please see "Description of Securities-- Registration Rights." Employment Agreements We have entered into employment agreements with each of Messrs. Crane, Arabe, Farrington and Papciak and Ms. Goodrum. Please see "Management--Employment and Severance Arrangements" for more details regarding these agreements. In November 1994, we entered into an employment agreement with Mr. Fenton. Under this agreement, Mr. Fenton's base salary may be increased or decreased from time-to-time, at our sole discretion. Mr. Fenton is also eligible to receive an incentive bonus. If Mr. Fenton's employment is terminated for reasons other than good cause, then he will be entitled to receive six months' salary and a pro-rata portion of his incentive bonus. We may terminate Mr. Fenton at any time. Mr. Fenton's current salary under the employment agreement is $96,996 per year. In addition, Mr. Fenton's current potential quarterly incentive bonuses, to be determined pursuant to the terms of the employment agreement, are based upon 1.25% of Mr. Fenton's annual salary. In November 1998, we entered into employment agreements with each of Messrs. DeMoss and Potter. Under these agreements, each employee receives a base salary of at least $225,000 per year and a bonus of up to $50,000 per year. In addition, pursuant to the agreement, each employee was granted a fully vested option to purchase 6,920.5 shares of our common stock, on a pre-split basis, and an additional option to purchase 416,666.5 shares of our common stock, on a pre-split basis, 20% of which vested immediately and 80% of which vest over 48 months commencing on January 1, 1999. The term of each agreement expires on January 1, 2003. If either employee is terminated without cause prior to November 5, 2000, then he shall be entitled to receive twelve months' salary in exchange for consulting services. If either employee is terminated after November 5, 2000, then he shall receive his base salary for a period equal to the shorter of six months or the remaining term of his employment agreement in exchange for consulting services. During any period in which the terminated employee provides consulting services to us, his options will continue to vest. In any event, at least 75% of such terminated employee's options will vest if he is terminated without cause prior to January 1, 2003. 51 Corporate Headquarters Lease We lease our corporate headquarters in San Diego, California from a limited partnership whose general partner is a company owned by Mr. Crane, our President, Chief Executive Officer and Chairman of the Board. In addition, Mr. Beasley, one of our directors, is a limited partner of the limited partnership from which we lease our facilities. Our lease is for a five-year term commencing in February 1999 with five two-year extension options. We believe that the terms of the lease are no less favorable to us than those that could have been obtained from an independent third party lessor at the time the lease was executed. For additional information regarding our facility leases, please see "Business--Facilities." 52 Principal and Selling Stockholders The following table sets forth certain information with respect to the beneficial ownership of our common stock as of February 19, 1999 on a pre-split basis and assuming the exercise of all warrants, and as adjusted to reflect the sale of the shares of common stock offered hereby, by (1) each person (or group of affiliated persons) who we know owns beneficially 5% or more of our common stock, (2) each of our directors, (3) our executive officers listed in the Summary Compensation Table and (4) all of our directors and executive officers as a group. Percentage of ownership is calculated as required by Commission Rule 13d-3(d)(1). Except as indicated below, the persons named in the table have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them. The number of shares underlying options includes shares which are exercisable within 60 days from the date of this offering. The address for those individuals for which an address is not otherwise indicated is: 9888 Carroll Centre Road, Suite 100, San Diego, California 92126-4581. Certain selling stockholders may sell shares in connection with the exercise of the over-allotment option. Mr. Crane may sell up to shares, Mr. Beasley may sell up to shares and Summit Partners may sell up to shares. Any shares that may be sold by selling stockholders if the underwriters exercise their over-allotment option have not been reflected in this table. For further information regarding the selling stockholders' relationship with us during the last three years, please see, "Management--Executive Officers and Directors" and "Certain Relationships and Related Transactions."
Number of Percentage of Percentage of Number of Shares Shares Beneficially Shares Beneficially Shares Underlying Owned Prior Owned After Beneficial Owner Outstanding Options to this Offering this Offering - ---------------- ----------- ---------- ------------------- ------------------- Funds affiliated with Summit Partners........ 5,503,436 -- 52.67% 499 Hamilton Avenue, Suite 200 Palo Alto, CA 94301 Christopher A. Crane.... 3,985,974 -- 38.15% Gregory M. Avis......... 5,503,436 -- 52.67% Robert C. Beasley....... 894,540 -- 8.56% Kenneth F. Potashner.... -- -- * Walter W. Papciak....... -- 69,000 * Michael Arabe........... -- 78,600 * Craig S. Farrington..... -- 78,600 * Karen Goodrum........... -- 78,600 * All directors and executive officers as a group (8 persons)...... 10,383,950 304,800 100% 100%
- -------- * Less than 1% of total. The 5,503,436 shares listed above as outstanding for Summit Partners and Mr. Avis includes 4,728,437 shares beneficially owned by Summit Ventures III, L.P. and 96,499 shares beneficially owned by Summit Investors II, L.P. This number also includes 664,930 shares issuable upon exercise of warrants to purchase common stock beneficially owned by Summit Ventures III, L.P. and 13,570 shares issuable upon exercise of warrants to purchase common stock beneficially owned by Summit Investors II, L.P. Mr. Avis is a general partner of Stamps, Woodsum & Co. III, a general partner of Summit Partners III, L.P. Summit Partners III, L.P. is the general partner of Summit Ventures III, L.P. Mr. Avis is also a general partner of Summit Investors II, L.P. Mr. Avis disclaims beneficial ownership of all shares of common stock issued or issuable to Summit Ventures III, L.P. and Summit Investors II, L.P., except to the extent of his pecuniary interest, but exercises shared voting and investment power with respect to all such shares. 53 Description of Securities The following information describes our common stock and preferred stock and certain provisions of our certificate of incorporation and our bylaws as will be in effect upon the closing of this offering. This description is only a summary. You should also refer to the certificate and bylaws which have been filed with the SEC as exhibits to our registration statement, of which this prospectus forms a part. The descriptions of our common stock and preferred stock reflect changes to our capital structure that will occur upon the approval of our board of directors and stockholders and upon the closing of this offering in accordance with the terms of the certificate. All share numbers below are calculated prior to a stock split of to , which is subject to stockholder approval. Upon the completion of the offering our authorized capital stock will consist of 70,000,000 shares of common stock, par value $0.01 per share, and 5,000,000 shares of preferred stock, par value $0.01 per share. Common Stock As of December 31, 1998, there were 4,817,360 shares of common stock outstanding and held of record by three stockholders. Based upon the number of shares outstanding and giving effect to (1) the automatic conversion of each share of our Class B common stock into one share of our Class A common stock and the renaming of such stock as "common stock" upon the closing of this offering, (2) the automatic conversion of each share of our preferred stock into one share of our common stock upon the closing of this offering, (3) a for stock split of our common stock to be effected prior to the closing of this offering and (4) the issuance of the shares of common stock offered by us hereby, there will be shares of common stock outstanding upon the closing of this offering. Holders of common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders and do not have cumulative voting rights. Accordingly, holders of a majority of the shares of common stock entitled to vote in any election of directors may elect all of the directors standing for election. Holders of common stock are entitled to receive ratably such dividends, if any, as may be declared by the board of directors out of funds legally available therefor, subject to any preferential dividend rights of any outstanding preferred stock. Holders of common stock have no preemptive, subscription, redemption or conversion rights. The outstanding shares of common stock are, and the shares offered by us in this offering will be, when issued in consideration for payment thereof, fully paid and nonassessable. The rights, preferences and privileges of holders of common stock are subject to, and may be materially adversely affected by, the rights of the holders of shares of any series of preferred stock which we may designate and issue in the future. Upon the closing of this offering, there will be no shares of preferred stock outstanding. Preferred Stock As of December 31, 1998, there were 4,908,126 shares of convertible preferred stock outstanding. Each outstanding share of convertible preferred stock will be converted into one share of common stock upon the closing of this offering and such shares of convertible preferred stock will no longer be authorized, issued or outstanding. Upon the closing of this offering, the board of directors will be authorized, without further stockholder approval, to issue from time to time up to an aggregate of 5,000,000 shares of preferred stock in one or more series and to fix or alter the designations, powers, preferences, rights and any qualifications, limitations or restrictions of the shares of each such series thereof, including the dividend rights, dividend rates, conversion rights, voting rights, terms of redemption (including sinking fund provisions), redemption price or prices, liquidation preferences and the number of shares constituting any series or designations of such series. We have no present plans to issue any shares of preferred stock. Please see "--Anti-Takeover Effects of Certain Provisions of Delaware Law and our Certificate of Incorporation and Bylaws." 54 Options As of December 31, 1998, options to purchase a total of 2,385,449 shares of common stock were outstanding, all of which are subject to lock-up arrangements under the terms of the option agreements. Upon completion of this offering, options to purchase a total of 2,800,000 shares of common stock may be granted under the 1999 stock incentive plan. Please see "Management--Benefit Plans" and "Shares Eligible for Future Sale." Common Stock Warrants As of December 31, 1998, we have outstanding warrants to purchase a total of 723,295 shares of common stock, at an exercise price of $0.01 per share and warrants to purchase a total of 213,068 shares of common stock, at a weighted average exercise price of $1.76 per share. The warrants contain anti-dilution provisions providing for adjustments of the exercise price and the number of shares underlying the warrants upon the occurrence of certain events, including any recapitalization, reclassification, stock dividend, stock split, stock combination or similar transaction. The warrants grant their holders certain registration rights with respect to the common stock issuable upon their exercise, which are described below. All of these warrants will be exercisable immediately prior to this offering. Warrants to purchase 213,068 shares expire in September 2003, warrants to purchase 379,869 shares expire in October 2004, and warrants to purchase 343,426 in February 2008. Registration Rights As of December 31, 1998, pursuant to the terms of an agreement with certain of our stockholders, after the closing of this offering, the holders of 5,844,489 shares of outstanding or issuable common stock on a pre-split basis will be entitled to certain demand registration rights with respect to the registration of their shares under the Securities Act of 1933. The holders of 50% of such shares are entitled to demand that we register their shares under the Securities Act of 1933, subject to certain limitations. We are not required to effect more than two such registrations for such holders pursuant to such demand registration rights. In addition, after the closing of this offering, these holders will be entitled to certain piggyback registration rights with respect to the registration of such shares of common stock under the Securities Act of 1933. In the event that we propose to register any shares of common stock under the Securities Act of 1933 either for our account or for the account of our other security holders, the holders of shares having piggyback rights are entitled to receive notice of such registration and are entitled to include their shares in any such registration, subject to certain limitations. Further, at any time after we become eligible to file a registration statement on Form S-3, the holders of 584,449 shares of common stock on a pre-split basis may require us to file registration statements under the Securities Act of 1933 on Form S-3 with respect to their shares of common stock. These registration rights are subject to certain conditions and limitations, including the right of the underwriters of an offering to limit the number of shares of common stock held by securityholders with registration rights to be included in such registration. We are generally required to bear all of the expenses of all such registrations, including the reasonable fees of a single counsel acting on behalf of all selling holders, except underwriting discounts and selling commissions. Registration of any of the shares of common stock held by securityholders with registration rights would result in such shares becoming freely tradable without restriction under the Securities Act of 1933 immediately upon effectiveness of such registration. Anti-Takeover Effects of Certain Provisions of Delaware Law and our Certificate of Incorporation and Bylaws We are subject to the provisions of Section 203 of the Delaware General Corporation Law. Subject to certain exceptions, Section 203 prohibits a publicly-held Delaware corporation from engaging in a "business combination" with an "interested stockholder" for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the interested stockholder attained such status with the approval of the board of directors or unless the business combination is approved in a prescribed manner. A 55 "business combination" includes mergers, asset sales and other transactions resulting in a financial benefit to the interested stockholder. Subject to certain exceptions, an "interested stockholder" is a person who, together with affiliates and associates, owns, or within three years did own, 15% or more of the corporation's voting stock. This statute could prohibit or delay the accomplishment of mergers or other takeover or change in control attempts with respect to us and, accordingly, may discourage attempts to acquire us. In addition, certain provisions of our certificate and bylaws, which provisions will be in effect upon the closing of this offering and are summarized in the following paragraphs, may be deemed to have an anti-takeover effect and may delay, defer or prevent a tender offer or takeover attempt that a stockholder might consider in its best interest, including those attempts that might result in a premium over the market price for the shares held by stockholders. Board of Directors Vacancies. Our bylaws authorize the board of directors to fill vacant directorships or increase the size of the board of directors. This may deter a stockholder from removing incumbent directors and simultaneously gaining control of the board of directors by filling the vacancies created by such removal with its own nominees. Staggered Board. Our bylaws provide that our board will be classified into two classes of directors beginning at the next annual meeting of stockholders. Please see "Management--Classes of the Board" for more information regarding the staggered board. Stockholder Action; Special Meeting of Stockholders. Our certificate provides that stockholders may not take action by written consent, but only at duly called annual or special meetings of stockholders. Our bylaws further provide that special meetings of our stockholders may be called only by the President, Chief Executive Officer or Chairman of the board of directors or a majority of the board of directors. Advance Notice Requirements for Stockholder Proposals and Director Nominations. Our bylaws provide that stockholders seeking to bring business before our annual meeting of stockholders, or to nominate candidates for election as directors at our annual meeting of stockholders, must provide timely notice thereof in writing. To be timely, a stockholder's notice must be delivered to, or mailed and received at, our principal executive offices not less than 120 days prior to the first anniversary of the date of our notice of annual meeting provided with respect to the previous year's annual meeting of stockholders; provided, that if no annual meeting of stockholders was held in the previous year or the date of the annual meeting of stockholders has been changed to be more than 30 calendar days earlier than such anniversary, notice by the stockholder, to be timely, must be so received a reasonable time before the solicitation is made. Our bylaws also specify certain requirements as to the form and content of a stockholder's notice. These provisions may preclude stockholders from bringing matters before our annual meeting of stockholders or from making nominations for directors at our annual meeting of stockholders. Authorized But Unissued Shares. Our authorized but unissued shares of common stock and preferred stock are available for future issuance without stockholder approval, subject to certain limitations imposed by the Nasdaq National Market. These additional shares may be utilized for a variety of corporate purposes, including future public offerings to raise additional capital, corporate acquisitions and employee benefit plans. The existence of authorized but unissued and unreserved common stock and preferred stock could render more difficult or discourage an attempt to obtain control of us by means of a proxy contest, tender offer, merger or otherwise. Delaware law provides generally that the affirmative vote of a majority of the shares entitled to vote on any matter is required to amend a corporation's certificate of incorporation or bylaws, unless a corporation's certificate of incorporation or bylaws, as the case may be, requires a greater percentage. 56 Limitation of Liability and Indemnification Matters Our certificate provides that, except to the extent prohibited by Delaware law, our directors shall not be personally liable to us or our stockholders for monetary damages for any breach of their fiduciary duty as directors. Under Delaware law, the directors have a fiduciary duty to us which is not eliminated by this provision of our certificate and, in appropriate circumstances, equitable remedies such as injunctive or other forms of nonmonetary relief will remain available. In addition, each director will continue to be subject to liability under Delaware law for breach of their duty of loyalty to us for acts or omissions which are found by a court of competent jurisdiction to be not in good faith or which involve intentional misconduct, or knowing violations of law, for actions leading to improper personal benefit to the director, and for payment of dividends or approval of stock repurchases or redemptions that are prohibited by Delaware law. This provision also does not affect the directors' responsibilities under any other laws, such as the federal securities laws or state or federal environmental laws. Section 145 of the Delaware General Corporation Law allows a corporation to indemnify its directors and officers and to purchase insurance with respect to liability arising out of their capacity or status as directors and officers, provided that the indemnification does not eliminate or limit the liability of a director for the following: . any breach of the director's duty of loyalty to us or our stockholders; . acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law; . unlawful payments of dividends or unlawful stock purchases or redemptions; and . any transaction from which the director derived an improper personal benefit. Delaware law further provides that the permitted indemnification shall not be deemed exclusive of any other rights to which the directors and officers may be entitled under our bylaws, any agreement, a vote of stockholders or otherwise. Our certificate eliminates the personal liability of directors to the fullest extent permitted by Delaware law. In addition, our certificate provides that we may fully indemnify any person who was or is a party, or is threatened to be made a party to, any threatened, pending or completed action, suit or proceeding (whether civil, criminal, administrative or investigative) by reason of the fact that such person is or was one of our directors or officers or is or was serving at our request as a director or officer of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, against expenses (including attorney's fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding. We have also entered into agreements to indemnify our directors and executive officers, in addition to the indemnification provided for in our bylaws. We believe that these provisions and agreements are necessary to attract and retain qualified directors and executive officers. Our bylaws also permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions, regardless of whether Delaware law would permit indemnification. We have applied for liability insurance for our officers and directors. At present, there is no pending litigation or proceeding involving any director, officer, employee or agent as to which indemnification will be required or permitted under the certificate. We are not aware of any threatened litigation or proceeding that may result in a claim for such indemnification. Transfer Agent and Registrar The transfer agent and registrar for the common stock is American Stock Transfer. 57 Shares Eligible For Future Sale The market price of our common stock could decline as a result of sales of a large number of shares of our common stock in the market after this offering, or the perception that such sales could occur. Such sales also might make it more difficult for us to sell equity securities in the future at a time and price that we deem appropriate. After this offering, we will have outstanding shares of common stock. Of these shares, the shares being offered hereby are freely tradable. All of our directors and officers, stockholders, optionholders and warrantholders, who, as of December 31, 1998, held a total of 13,047,298 shares of our outstanding or issuable common stock, on a pre-split basis, have entered into lock-up agreements. Under these lock-up agreements, they have agreed that they will not sell, directly or indirectly, any shares of common stock without the prior written consent of Volpe Brown Whelan & Company, LLC, for a period of 180 days from the date of this prospectus. In general, under Rule 144, as currently in effect, a person (or persons whose shares are required to be aggregated), including an affiliate, who has beneficially owned shares for at least one year is entitled to sell, within any three-month period commencing 90 days after the date of this prospectus, a number of shares that does not exceed the greater of (1) 1% of the then outstanding shares of common stock (approximately shares immediately after this offering) or (2) the average weekly trading volume in the common stock during the four calendar weeks preceding the date on which notice of such sale is filed, subject to certain restrictions. In addition, a person who is not deemed to have been our affiliate at any time during the 90 days preceding a sale and who has beneficially owned the shares proposed to be sold for at least two years would be entitled to sell such shares under Rule 144(k) without regard to the requirements described above. To the extent that shares were acquired from one of our affiliates, such person's holding period for the purpose of effecting a sale under Rule 144 commences on the date of transfer from the affiliate. As of December 31, 1998, options to purchase a total of 2,385,449 shares of common stock, on a pre-split basis, were outstanding, of which options to purchase 679,623 shares, on a pre-split basis, were exercisable. Of the options to purchase 1,705,826 shares of common stock, on a pre-split basis, that were not exercisable, options to purchase 152,000 shares of common stock, on a pre- split basis, shall immediately vest and become exercisable upon the closing of this offering. Upon the closing of this offering, we intend to file a registration statement to register for resale the 2,800,000 shares of common stock, on a pre-split basis, reserved for issuance under our stock option plans. We expect such registration statement to become effective immediately upon filing. Shares issued upon the exercise of stock options granted under our stock option plans will be eligible for resale in the public market from time to time subject to vesting and, in the case of certain options, the expiration of the lock-up agreements referred to below. As of December 31, 1998 certain stockholders and warrantholders, holding approximately 5,844,489 shares of outstanding or issuable common stock, on a pre-split basis, had the right, subject to certain conditions and limitations, to include their shares in certain registration statements relating to our securities. By exercising their registration rights and causing a large number of shares to be registered and sold in the public market, these holders may cause the price of the common stock to fall. In addition, any demand to include such shares in our registration statements could have a material adverse effect on our ability to raise needed capital. Please see "Management--Benefit Plans," "Principal and Selling Stockholders," "Description of Securities--Registration Rights," "Shares Eligible for Future Sale" and "Underwriting." 58 Underwriting Under the terms and conditions contained in an underwriting agreement among the underwriters and us, each of the underwriters, for whom Volpe Brown Whelan & Company, LLC, EVEREN Securities, Inc. and Needham & Company, Inc., are acting as representatives, have severally agreed to purchase from us the number of shares of common stock set forth opposite its name below:
Number of Underwriter Shares - ----------- ------------- Volpe Brown Whelan & Company, LLC................................. EVEREN Securities, Inc. .......................................... Needham & Company, Inc. .......................................... ------------- Total......................................................... =============
The underwriting agreement provides that the obligations of the several underwriters to purchase shares of common stock are subject to approval of certain legal matters by their counsel and to certain other conditions. Under the terms and conditions of the underwriting agreement, all of the underwriters are obligated to take and pay for all such shares of common stock if any are taken. The underwriters propose initially to offer the shares of common stock directly to the public at the public offering price set forth on the cover page of this prospectus and to certain dealers at such price, less a concession not in excess of $ per share. The underwriters may allow, and such dealers may reallow, concessions not in excess of $ per share of the common stock to certain other dealers. After the initial public offering of the common stock, the offering price of the common stock and other selling terms may be changed by the underwriters. The underwriters expect to deliver the shares against payment in San Francisco, California on , 1999. Pursuant to the underwriting agreement, the selling stockholders have granted to the underwriters an option, exercisable for 30 days from the date of this prospectus, to purchase up to additional shares of common stock on the same terms and conditions as set forth on the cover page of this prospectus. The underwriters may exercise this option solely to cover over-allotments. To the extent such option is exercised, each underwriter will have a commitment subject to certain conditions, to purchase a number of additional shares of common stock proportionate to such underwriter's initial commitment pursuant to the underwriting agreement. From the date of this prospectus until 180 days after such date, we and all of our stockholders, officers and directors have agreed not to (1) offer, sell, contract to sell, make any short sale, pledge or otherwise dispose of, directly or indirectly, any shares of common stock or any options to acquire shares of common stock or securities convertible into or exchangeable for any other rights to purchase or acquire common stock or (2) enter into any swap or other agreements that transfers, in whole or in part, any of the economic consequences or ownership of common stock, without the prior consent of Volpe Brown Whelan & Company, LLC. The underwriters have reserved for sale, at the initial public offering price, shares of common stock for certain of our directors, officers, employees, friends and family who have expressed an interest in purchasing shares of common stock in this offering. Such persons are expected to purchase, in the aggregate, not more than 5% of the common stock offered in this offering. The number of shares available for sale to the general public in this offering will be reduced to the extent such persons purchase such reserved shares. Any reserved shares not purchased will be offered by the underwriters on the same basis as other shares offered hereby. We and the selling stockholders have agreed to indemnify the underwriters against certain liabilities, losses and expenses, including liabilities under the Securities Act of 1933, or to contribute to payments that the underwriters may be required to make in respect thereof. 59 Prior to this offering, there has been no public market for our common stock. The initial public offering price for the shares of common stock in this offering was determined by agreement between us and the underwriters. Among the factors considered in making such determination were the history of, and the prospects for, the industry in which we compete, an assessment of our management, our present operations, our historical results of operations and the trend of our revenues and earnings, our prospects for future earnings, the general condition of the securities markets at the time of this offering and the price of similar securities of generally comparable companies. We cannot assure you that an active trading market will develop for our common stock or that our common stock will trade in the public markets at or above the initial public offering price. Certain persons participating in this offering may engage in transactions that stabilize, maintain or otherwise affect the price of our common stock including over-allotment, stabilizing and short-covering transactions and the impositions of penalty bids. Certain persons participating in this offering may also engage in passive market making transactions in the common stock on the Nasdaq National Market. In order to facilitate this offering, certain persons participating in this offering may engage in transactions that stabilize, maintain or otherwise affect the price of the common stock during and after this offering. Specifically, the underwriters may over-allot or otherwise create a short position in the common stock for their own account by selling more shares of common stock than have been sold to them by us. The underwriters may elect to cover any such short position by purchasing shares of common stock in the open market or by exercising the over-allotment option granted to the underwriters. In addition, the underwriters may stabilize or maintain the price of the common stock by bidding for or purchasing shares of common stock in the open market and may impose penalty bids, under which selling concessions allowed to syndicate members or other broker-dealers participating in this offering are reclaimed if shares of common stock previously distributed in this offering are repurchased in connection with stabilization transactions or otherwise. The effect of these transactions may be to stabilize or maintain the market price at a level above that which might otherwise prevail in the open market. The imposition of a penalty bid may also affect the price of the common stock to the extent that it discourages resales thereof. No representation is made as to the magnitude or effect of any such stabilization or other transactions. Such transactions may be effected on the Nasdaq National Market or otherwise and, if commenced, may be discontinued at any time. 60 Legal Matters The validity of the shares of common stock offered hereby will be passed upon for us by Brobeck, Phleger & Harrison LLP, San Diego, California. Certain legal matters in connection with this offering will be passed upon for the underwriters by Katten Muchin & Zavis, Chicago, Illinois. Experts Ernst & Young LLP, independent auditors, have audited our financial statements and schedule included in this prospectus as of December 31, 1997 and 1998 and for each of the three years in the period ended December 31, 1998, as set forth in their report, which is included in this prospectus. In addition, Ernst & Young LLP have audited the financial statements of REALBID, LLC included in this prospectus as of December 31, 1997 and for the period from June 19, 1997 (inception) to December 31, 1997, as set forth in their report, which is also included in this prospectus. Our financial statements and the financial statements of REALBID, LLC are included in this prospectus in reliance on Ernst & Young LLP's reports, given on their authority as experts in accounting and auditing. Where You Can Find More Information We have filed with the SEC a registration statement on Form S-1 (including the exhibits, schedules and amendments to the registration statement) under the Securities Act of 1933 with respect to the shares of common stock to be sold in this offering. This prospectus does not contain all the information set forth in the registration statement. For further information with respect to COMPS and the shares of common stock to be sold in this offering, reference is made to the registration statement. Statements contained in this prospectus as to the contents of any contract, agreement or other document referred to are not necessarily complete, and in each instance reference is made to the copy of such contract, agreement or other document filed as an exhibit to the registration statement, each such statement being qualified in all respects by such reference. You may read and copy all or any portion of the registration statement or any other information we file at the SEC's public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549. You can request copies of these documents, upon payment of a duplicating fee, by writing to the SEC. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference rooms. Our SEC filings, including the registration statement, are also available to you on the Commission's Web site (http://www.sec.gov). As a result of this offering, we will become subject to the information and reporting requirements of the Securities Exchange Act of 1934, and, in accordance therewith, will file periodic reports, proxy statements and other information with the SEC. Upon approval of the common stock for the quotation on the Nasdaq National Market, such reports, proxy and information statements and other information may also be inspected at the offices of Nasdaq Operations, 1735 K Street, N.W., Washington, D.C. 20006. We intend to furnish our stockholders with annual reports containing audited financial statements and with quarterly reports for the first three quarters of each year containing unaudited interim consolidated financial information. 61 Index to Financial Statements
Page ---- COMPS.COM, Inc. Report of Ernst & Young LLP, Independent Auditors......................... F-2 Balance Sheets as of December 31, 1997 and 1998........................... F-3 Statements of Operations for the years ended December 31, 1996, 1997 and 1998..................................................................... F-4 Statements of Stockholders' Deficit for the years ended December 31, 1996, 1997 and 1998............................................................ F-5 Statements of Cash Flows for the years ended December 31, 1996, 1997 and 1998..................................................................... F-6 Notes to Financial Statements............................................. F-7 REALBID, LLC Report of Ernst & Young LLP, Independent Auditors......................... F-21 Statements of Operations for the period from June 19, 1997 (inception) to December 31, 1997 and the nine-month period ended September 30, 1998 (unaudited).............................................................. F-22 Statements of Members' Equity for the period from June 19, 1997 (inception) to December 31, 1997 and the nine-month period ended September 30, 1998 (unaudited)........................................... F-23 Statements of Cash Flows for the period from June 19, 1997 (inception) to December 31, 1997 and the nine-month period ended September 30, 1998 (unaudited).............................................................. F-24 Notes to Financial Statements............................................. F-25 Unaudited Pro Forma Condensed Statements of Operations Unaudited Pro Forma Condensed Statement of Operations..................... F-27 Notes to Unaudited Pro Forma Condensed Statement of Operations............ F-28
F-1 Report of Ernst & Young LLP, Independent Auditors The Board of Directors COMPS.COM, Inc. We have audited the accompanying balance sheets of COMPS.COM, Inc. as of December 31, 1997 and 1998, and the related statements of operations, stockholders' deficit and cash flows for each of the three years in the period ended December 31, 1998. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of COMPS.COM, Inc. at December 31, 1997 and 1998, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 1998 in conformity with generally accepted accounting principles. Ernst & Young LLP San Diego, California February 5, 1999, except for Note 15, as to which the date is February 22, 1999 F-2 COMPS.COM, Inc. Balance Sheets
Pro Forma December 31, Stockholders' ----------------------- Deficit at 1997 1998 December 31, 1998 ---------- ----------- ----------------- (Unaudited) Assets Current assets: Cash and cash equivalents.......... $ 351,621 $ 377,803 Accounts receivable, less allowance for bad debts and cancellations of $1,384,242 and $1,464,922 at December 31, 1997 and 1998, respectively...................... 2,298,167 3,165,817 Prepaid expenses................... 146,363 184,520 ---------- ----------- Total current assets................ 2,796,151 3,728,140 Furniture and equipment, net........ 1,203,750 1,470,538 Intangible assets, net.............. 53,485 2,162,350 Deposits and other assets........... 37,450 36,249 ---------- ----------- Total assets........................ $4,090,836 $ 7,397,277 ========== =========== Liabilities, redeemable preferred stock and stockholders' deficit Current liabilities: Accounts payable................... $ 358,638 $ 530,860 Accrued liabilities................ 934,953 1,019,647 Current portion of long-term debt.. 467,203 979,208 Current portion of capital lease obligations....................... 65,101 49,343 Deferred subscription revenue...... 4,023,228 5,502,869 ---------- ----------- Total current liabilities........... 5,849,123 8,081,927 Long-term debt, less current portion............................ 1,750,372 1,100,628 Capital lease obligations, less current portion.................... 71,955 22,612 Deferred rent....................... 108,906 71,187 ---------- ----------- Total liabilities................... 7,780,356 9,276,354 Commitments Redeemable convertible preferred stock, par value $.01 per share; 5,000,000 shares authorized: Series A, 4,270,336 shares issued and outstanding at December 31, 1997 and 1998..................... 5,815,806 6,114,730 $ -- Series B, 637,790 shares issued and outstanding at December 31, 1998.. -- 1,201,462 -- Stockholders' deficit: Class A common stock, par value $.01 per share; 22,500,000 shares authorized; 4,773,860 shares issued and outstanding (at stated value) at December 31, 1997 and 1998 (9,725,486 pro forma-- unaudited)........................ 29,219 29,219 78,735 Class B common stock, par value $.01 per share; 2,500,000 shares authorized; 43,500 shares issued and outstanding at December 31, 1998 (0 pro forma--unaudited)..... -- 435 -- Additional paid-in capital........ -- 4,759,600 12,026,711 Deferred compensation............. -- (2,538,421) (2,538,421) Accumulated deficit............... (9,534,545) (11,446,102) (11,446,102) ---------- ----------- ----------- Total stockholders' deficit......... (9,505,326) (9,195,269) $(1,879,077) ---------- ----------- =========== Total liabilities, redeemable preferred stock and stockholders' deficit............................ $4,090,836 $ 7,397,277 ========== ===========
See accompanying notes. F-3 COMPS.COM, Inc. Statements of Operations
Years ended December 31, ------------------------------------- 1996 1997 1998 ----------- ----------- ----------- Net revenues............................ $ 8,140,693 $10,449,936 $12,805,761 Cost of revenues........................ 4,356,973 5,053,998 5,746,180 ----------- ----------- ----------- Gross profit............................ 3,783,720 5,395,938 7,059,581 Operating expenses: Selling and marketing................. 2,812,596 3,407,906 4,181,945 Product development and engineering... 376,331 768,051 1,230,349 General and administrative............ 2,835,271 2,525,526 2,936,052 ----------- ----------- ----------- Total operating expenses................ 6,024,198 6,701,483 8,348,346 ----------- ----------- ----------- Loss from operations.................... (2,240,478) (1,305,545) (1,288,765) Other: Gain from termination of covenant not- to-compete........................... 58,396 -- -- Interest income....................... 34,616 16,650 42,595 Interest expense...................... (159,905) (268,290) (302,152) ----------- ----------- ----------- Net loss................................ (2,307,371) (1,557,185) (1,548,322) Dividend accretion on preferred stock... 298,924 298,924 363,235 ----------- ----------- ----------- Net loss attributable to common stockholders........................... $(2,606,295) $(1,856,109) $(1,911,557) =========== =========== =========== Net loss per share attributable to common stockholders, basic and diluted................................ $ (0.55) $ (0.39) $ (0.40) =========== =========== =========== Shares used in computing net loss attributable to common stockholders, basic and diluted...................... 4,773,860 4,773,860 4,794,896 =========== =========== =========== Pro forma net loss per share, basic and diluted................................ $ (0.16) =========== Shares used in computing pro forma net loss per share, basic and diluted...... 9,634,874 ===========
See accompanying notes. F-4 COMPS.COM, Inc. Statements of Stockholders' Deficit
Common Stock ------------------------------- Additional Total Class A Class B Paid-In Deferred Accumulated Stockholders' Shares Amount Shares Amount Capital Compensation Deficit Deficit --------- ------- ------ ------ ---------- ------------ ------------ ------------- Balance at December 31, 1995................... 4,773,860 $29,219 -- $ -- $ -- $ -- $ (5,072,141) $(5,042,922) Accretion of preferred stock redemption value................. -- -- -- -- -- -- (298,924) (298,924) Net loss............... -- -- -- -- -- -- (2,307,371) (2,307,371) --------- ------- ------ ----- ---------- ----------- ------------ ----------- Balance at December 31, 1996................... 4,773,860 29,219 -- -- -- -- (7,678,436) (7,649,217) Accretion of preferred stock redemption value................. -- -- -- -- -- -- (298,924) (298,924) Net loss............... -- -- -- -- -- -- (1,557,185) (1,557,185) --------- ------- ------ ----- ---------- ----------- ------------ ----------- Balance at December 31, 1997................... 4,773,860 29,219 -- -- -- -- (9,534,545) (9,505,326) Issuance of stock upon exercise of options... -- -- 43,500 435 12,615 -- -- 13,050 Accretion of preferred stock redemption value................. -- -- -- -- -- -- (363,235) (363,235) Grant of stock options in connection with REALBID acquisition... -- -- -- -- 2,091,000 -- -- 2,091,000 Deferred compensation related to grant of certain stock options............... -- -- -- -- 2,655,985 (2,655,985) -- -- Amortization of deferred compensation.......... -- -- -- -- -- 117,564 -- 117,564 Net loss............... -- -- -- -- -- -- (1,548,322) (1,548,322) --------- ------- ------ ----- ---------- ----------- ------------ ----------- Balance at December 31, 1998................... 4,773,860 $29,219 43,500 $ 435 $4,759,600 $(2,538,421) $(11,446,102) $(9,195,269) ========= ======= ====== ===== ========== =========== ============ ===========
See accompanying notes F-5 COMPS.COM, Inc. Statements of Cash Flows
Years ended December 31, ------------------------------------- 1996 1997 1998 ----------- ----------- ----------- Operating activities Net loss................................ $(2,307,371) $(1,557,185) $(1,548,322) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation and amortization......... 1,020,029 913,781 803,998 Deferred compensation................. -- -- 117,564 Provision for bad debts............... -- 39,491 167,858 Impairment loss on acquired intangibles.......................... -- 183,233 -- Loss on disposal/write-off of assets.. -- 97,011 -- Interest imputed on note payable to TRW REDI............................. -- 48,619 49,252 Gain from covenant not-to-compete..... (58,396) -- -- Changes in operating assets and liabilities, net of effects from acquisitions: Accounts receivable................. (293,785) (529,824) (978,508) Prepaid expenses.................... 50,916 (41,820) (27,969) Deposits and other assets........... 23,414 3,767 (674) Accounts payable.................... 82,033 (56,032) 172,222 Accrued liabilities................. 334,016 326,864 84,694 Deferred rent....................... 24,534 (19,172) (37,719) Deferred subscription revenue....... 527,010 667,801 1,479,641 ----------- ----------- ----------- Net cash provided by (used in) operating activities............................. (597,600) 76,534 282,037 Investing activities Maturities of marketable securities, available-for-sale..................... 459,645 243,645 -- Purchases of furniture and equipment.... (592,278) (725,835) (933,876) Purchase of TRW REDI and LSR............ -- (80,000) -- Purchase of REALBID, net of cash acquired............................... -- -- (209,900) Loans to employees, net of repayments... 1,285 (6,715) (10,188) ----------- ----------- ----------- Net cash used in investing activities... (131,348) (568,905) (1,153,964) Financing activities Proceeds from notes payable............. 1,411,879 742,800 300,000 Payments on notes payable............... (264,851) (384,683) (486,991) Payments on capital lease obligations... (100,286) (91,664) (65,101) Proceeds from sale of preferred stock, net of issuance costs.................. -- -- 1,137,151 Proceeds from issuance of common stock.. -- -- 13,050 ----------- ----------- ----------- Net cash provided by financing activities............................. 1,046,742 266,453 898,109 ----------- ----------- ----------- Net increase (decrease) in cash......... 317,794 (225,918) 26,182 Cash at beginning of year............... 259,745 577,539 351,621 ----------- ----------- ----------- Cash at end of year..................... $ 577,539 $ 351,621 $ 377,803 =========== =========== =========== Supplemental disclosures of cash flow information: Interest paid......................... $ 143,024 $ 244,877 $ 251,527 =========== =========== =========== Income taxes paid..................... $ 5,563 $ 3,941 $ 3,712 =========== =========== =========== Supplemental schedule of noncash investing and financing activities: Equipment financed under capital leases............................... $ -- $ 30,806 $ -- =========== =========== ===========
See accompanying notes. F-6 COMPS.COM, Inc. Notes to Financial Statements December 31, 1998 1. Organization and Significant Accounting Policies Organization and Business Activity COMPS.COM, Inc., formerly known as COMPS InfoSystems, Inc. (the Company), compiles and maintains a national database of confirmed commercial real estate information. The Company provides its customers with reports on sales of office, industrial, retail, apartments, residential land, commercial land, hotels, motels and other special use properties. As of December 31, 1998, national coverage includes over 45 major cities throughout the United States. Basis of Presentation The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. This basis of accounting contemplates the recovery of the Company's assets and the satisfaction of its liabilities in the normal course of conducting business. The Company anticipates that it will require additional funds to continue the Company's product development activities; expand the Company's marketing and sales and customer services and support capabilities; fund the Company's capital expenditures to accommodate the anticipated increase in customers and geographic expansion; and expand certain financial and administrative functions. Management believes that the funds necessary to meet its capital requirements for the next twelve months will be raised either from a public offering or by private equity or debt financing. Without the additional funds, the Company will be required to reduce the scope of its product development projects and significantly reduce its expenditures on infrastructure and product and service upgrade programs. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in financial statements and accompanying notes. Actual results could differ from those estimates. Cash Equivalents The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. Concentration of Credit Risk The majority of sales and the related accounts receivable are from companies dealing in the commercial real estate industry throughout the United States. Credit is extended based upon an evaluation of the customer's financial condition and generally collateral is not required. Reserves for doubtful accounts are maintained by the Company. The Company has not experienced losses in excess of its reserves. Furniture and Equipment Furniture and equipment are depreciated using the double declining balance method over estimated useful lives of five and seven years, respectively. F-7 COMPS.COM, Inc. Notes to Financial Statements (continued) 1. Organization and Significant Accounting Policies (continued) Intangible Assets Intangible assets arose primarily from the acquisition of REALBID, LLC (see Note 2). The excess of cost over the fair value of the net assets purchased has been allocated to goodwill, customer base, database and web site technology, trademark and trade name and assembled work force. These intangible assets are being amortized over estimated useful lives ranging from three to five years. Asset Impairment In accordance with Statement of Financial Accounting Standards No. 121, Accounting for the Impairment of Long-Lived Assets and for Long Lived Assets to be Disposed Of (SFAS 121), the Company recognizes impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present and the estimated undiscounted cash flows to be generated by those assets are less than the assets' carrying amount. SFAS 121 also addresses the accounting for long-lived assets that are expected to be disposed of. In 1997, impairment losses of approximately $183,000 were recorded to write-down certain acquired intangibles. In 1996 and 1998, no impairment losses were recorded. Stock-Based Compensation The Company has elected to follow Accounting Principles Board Opinion No. 25 Accounting for Stock Issued to Employees (APB 25) and related Interpretations in accounting for its employee stock options. Revenue Recognition The Company recognizes product and related services revenue at the time of shipment or performance of services. A substantial portion of the Company's revenues come from subscription sales. Subscriptions are recorded as accounts receivable and as deferred revenues at the time the customer is invoiced. Subscription revenue, net of reserve for cancellations, is recognized over the subscription term. Significant Customers During 1996, 1997 and 1998, no single customer accounted for more than 10% of revenues. Product Development and Engineering Product development and engineering costs are expensed in the period incurred. Net Loss Per Share and Unaudited Pro Forma Stockholders' Deficit Historical basic and diluted net loss per share are computed using the weighted average number of common shares outstanding. Options, warrants and preferred stock were not included in the computation of diluted net loss per share because the effect would be antidilutive. Pro forma net loss per share has been computed as described above and also gives effect to common equivalent shares from preferred stock that will automatically convert upon the closing of the Company's initial public offering (using the as-if-converted method). If the offering contemplated is consummated, all of the redeemable convertible preferred stock outstanding as of the closing date will automatically be converted into an aggregate of 4,908,126 shares of common stock. Unaudited pro forma stockholders' deficit at December 31, 1998, as adjusted for the conversion of redeemable convertible preferred stock, is disclosed on the balance sheet. F-8 COMPS.COM, Inc. Notes to Financial Statements (continued) 1. Organization and Significant Accounting Policies (continued) Net Loss Per Share and Unaudited Pro Forma Stockholders' Deficit (continued) A reconciliation of shares used in the calculation of historical and pro forma basic and diluted net loss per share attributable to common stockholders follows:
Year ended December 31, ------------------------------------- 1996 1997 1998 ----------- ----------- ----------- Historical net loss per share attributable to common stockholders, basic and diluted: Net loss attributable to common stockholders....................... $(2,606,295) $(1,856,109) $(1,911,557) =========== =========== =========== Shares used in computing net loss attributable to common stockholders, basic and diluted.... 4,773,860 4,773,860 4,794,896 =========== =========== =========== Net loss per share attributable to common stockholders, basic and diluted............................ $ (0.55) $ (0.39) $ (0.40) =========== =========== =========== Antidilutive securities including options, warrants, and preferred stock not included in historical net loss per share attributable to common stockholders calculations... 5,508,682 5,748,023 8,229,938 =========== =========== =========== Pro forma net loss per share: Net loss attributable to common stockholders....................... $(1,911,557) Less: dividend accretion on redeemable convertible preferred stock.............................. 363,235 ----------- Pro forma net loss.................. $(1,548,322) =========== Shares used in computing net loss attributable to common stockholders, basic and diluted.... 4,794,896 Adjustment to reflect the effect of the assumed conversion of weighted average shares of redeemable convertible preferred stock........ 4,839,979 ----------- Shares used in computing pro forma net loss per share, basic and diluted............................ 9,634,874 =========== Pro forma net loss per share, basic and diluted......................... $ (0.16) ===========
F-9 COMPS.COM, Inc. Notes to Financial Statements (continued) 1. Organization and Significant Accounting Policies (continued) Impact of Recently Issued Accounting Standards In June 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 130, Reporting Comprehensive Income (SFAS 130). SFAS 130 requires that all components of comprehensive income, including net income, be reported in the financial statements in the period in which they are recognized. SFAS 130 is effective for fiscal years beginning after December 15, 1997. There was no difference between the Company's net loss and its total comprehensive loss for the years ended December 31, 1996, 1997 and 1998. In June 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards, No. 131, Disclosures About Segments of an Enterprise and Related Information (SFAS 131). SFAS 131 replace SFAS 14, "Financial Reporting for Segments of a Business Enterprise" and changes the way the public companies report segment information. SFAS 131 is effective for fiscal years beginning after December 15, 1997 and has been adopted by the Company for the year ending December 31, 1998. In March 1998, the American Institute of Certified Public Accountants issued Statement of Position 98-1 Accounting for the Costs of Computer Software Developed or Obtained for Internal Use (SOP 98-1). This standard requires companies to capitalize qualifying computer software costs which are incurred during the application development stage and amortize them over the software's estimated useful life. SOP 98-1 is effective for fiscal years beginning after December 15, 1998. The Company is currently evaluating the impact of SOP 98-1 on its financial statements and related disclosures. In April 1998, the American Institute of Certified Public Accountants issued Statement of Position 98-5 Reporting for the Costs of Start-Up Activities (SOP 98-5). This standard requires companies to expense the cost of start-up activities and organization costs as incurred. In general, SOP 98-5 is effective for fiscal years beginning after December 15, 1998. The Company believes the adoption of SOP 98-5 will not have a material impact on its results of operations. Reclassification Reclassifications have been made to certain prior period amounts to conform to the 1998 presentation. 2. Acquisitions Experian RES On November 30, 1997, the Company acquired the Experian RES investment property publishing business in Georgia and Florida for $80,000. The purchase price has been allocated to the assets purchased and the liabilities assumed based upon the fair values at the date of acquisition as follows: Current assets.................................................... $114,244 Subscription contracts............................................ 124,198 Deferred revenues................................................. (158,442) -------- $ 80,000 ========
Deferred revenues represent liabilities assumed to fulfill subscription contracts acquired from Experian. Deferred revenues will be recognized over the subscription term as product is shipped. The subscription contracts represent the estimated value of future revenue streams from renewals of subscription contracts F-10 COMPS.COM, Inc. Notes to Financial Statements (continued) 2. Acquisitions (continued) purchased. Experian RES is the successor-in-interest to TRW REDI and based on the Company's 1995 acquisition of TRW REDI's investment property publishing business, 50% of the subscription contracts were amortized in 1997 and the remaining 50% were amortized in 1998. REALBID On November 6, 1998, the Company acquired the assets of REALBID, LLC (REALBID) a real estate marketing services company which supports commercial real estate transactions over the Internet. The transaction was accounted for as a purchase. The purchase price consisted of cash payments of $163,000 and the grant of stock options to the principals to acquire 544,612 shares of the Company's common stock at $1.20 per share. The fair value of the options was determined to be $3.84 per share as of the date of the acquisition. As a result, the purchase price is calculated to be $2,308,400, which includes acquisition costs of $54,400. In addition, employment and incentive compensation agreements were entered into with the two principals of REALBID. The purchase price has been allocated as follows: Current assets.................................................... $ 64,500 Intangible assets................................................. 2,243,900 ---------- Net purchase price................................................ $2,308,400 ==========
The accompanying statements of operations reflect the operating results of REALBID since the date of the acquisition. The pro forma unaudited results of operations for the years ended December 31, 1997 and 1998, assuming the purchase of REALBID has occurred on June 19, 1997, are as follows:
1997 1998 ----------- ----------- Net revenues..................................... $10,465,436 $13,028,927 =========== =========== Net loss attributable to common stockholders..... $(2,362,860) $(2,434,911) =========== =========== Net loss per share attributable to common stockholders.................................... $ (0.49) $ (0.51) =========== ===========
AOBR, Inc. On December 4, 1998, the Company agreed to acquire certain assets of AOBR, Inc., subject to certain conditions, including completion of due diligence and approval by the Company's Board of Directors. The transaction closed on January 7, 1999. The purchase price consisted of cash payments of $120,000 plus acquisition costs of $9,200. The transaction will be recorded as a purchase and the purchase price will be allocated to the acquired database, non-competition agreement and goodwill. These intangibles will be amortized over two to five years. 3. Furniture and Equipment Furniture and equipment are stated at cost and consist of the following at December 31:
1997 1998 ----------- ----------- Machinery and equipment............................ $ 2,394,486 $ 3,200,644 Office furniture and fixtures...................... 87,559 141,877 Leasehold improvements............................. 150,553 223,953 ----------- ----------- 2,632,598 3,566,474 Accumulated depreciation........................... (1,428,848) (2,095,936) ----------- ----------- $ 1,203,750 $ 1,470,538 =========== ===========
F-11 COMPS.COM, Inc. Notes to Financial Statements (continued) 4. Intangibles Assets Intangible assets consist of the following at December 31:
1997 1998 -------- ---------- Customer base.......................................... $ -- $1,791,100 Database and web site technology....................... -- 268,700 Assembled workforce.................................... -- 94,600 Trademark and trade name............................... -- 89,500 Subscription contracts................................. 141,426 -- -------- ---------- 141,426 2,243,900 Less accumulated amortization.......................... (87,941) (81,550) -------- ---------- $ 53,485 $2,162,350 ======== ==========
During 1997, the Company determined that the subscription base relating to the 1995 acquisitions of TRW REDI and The Land Sales Resource was impaired as a result of lower than expected retention of the purchased subscription base. Fair value of the assets was calculated based on estimated future cash flows to be generated by the subscription base, discounted at a market rate of interest. This resulted in a write-down of the acquired intangibles of $183,233, which is reflected in general and administrative expense on the statement of operations. 5. Long-Term Debt In September 1996, the Company entered into a $3.0 million loan agreement with Venture Lending & Leasing, Inc. The terms of the agreement provide $1.5 million for fixed asset acquisition and $1.5 million as working capital. Borrowings for fixed assets acquisition and working capital are due forty-eight months and thirty-six months, respectively, from the date of disbursement. At December 31, 1998, $541,750 is available for draw for general operations and none is available for fixed asset acquisitions. The loan agreement originally expired on June 30, 1998, but was extended during 1998 to June 30, 1999. Notes payable to Venture Lending & Leasing, Inc. bear interest at 8.75% per annum during the term and a one-time balloon interest payment of 15% of the original principal amount is due upon completion of the term. The notes payable are secured by all fixed assets of the Company with the exception of two notes payable which are secured by all business assets of the Company. Long-term debt consists of the following at December 31:
1997 1998 --------- --------- Note payable to Venture Lending & Leasing, Inc. Principal and interest of $18,458 are due monthly through August 1, 1999 with additional balloon interest of $86,250 due October 1, 1999.............................. $ 378,636 $ 212,367 Note payable to Venture Lending & Leasing, Inc. Principal and interest of $21,006 are due monthly through August 1, 2000 with additional balloon interest of $125,532 due October 1, 2000............................. 630,194 463,489 Note payable to Venture Lending & Leasing, Inc. Principal and interest of $8,557 are due monthly through February 1, 2001 with additional balloon interest of $51,140 due April 1, 2001................................ 286,960 224,051
F-12 COMPS.COM, Inc. Notes to Financial Statements (continued) 5. Long-Term Debt (continued)
1997 1998 ---------- ---------- Note payable to Venture Lending & Leasing, Inc. Principal and interest of $2,555 are due monthly through October 1, 2001 with additional balloon interest of $15,268 due December 1, 2001............................ 96,356 79,851 Note payable to Venture Lending & Leasing, Inc. Principal and interest of $2,595 are due monthly through October 1, 2001 with additional balloon interest of $15,505 due January 1, 2002............................. 98,180 82,494 Note payable to Venture Lending & Leasing, Inc. Principal and interest of $2,931 are due monthly through November 1, 2001 with additional balloon interest of $17,514 due January 1, 2002............................. 110,301 93,431 Note payable to Venture Lending & Leasing, Inc. Principal and interest of $2,672 are due monthly through November 1, 2000 with additional balloon interest of $12,486 due December 1, 2001............................ 77,473 59,709 Note payable to Venture Lending & Leasing, Inc. Principal and interest of $9,630 are due monthly through September 1, 2001 with additional balloon interest of $45,000 due November 1, 2001............................ -- 275,717 Unsecured note payable to TRW REDI, due as follows: $405,800 on December 1, 1999; $145,000 on December 1, 2000; and $135,000 on December 31, 2001. Interest is imputed at 10% through December 1, 1999. Note bears interest at 8% subsequent to December 1, 1999........... 539,475 588,727 ---------- ---------- 2,217,575 2,079,836 Less current portion..................................... 467,203 979,208 ---------- ---------- Total long-term debt..................................... $1,750,372 $1,100,628 ========== ==========
Future annual payments of long-term debt are as follows at December 31, 1998: 1999........................................................... $ 979,208 2000........................................................... 659,738 2001........................................................... 423,812 2002........................................................... 17,078 ---------- Total.......................................................... $2,079,836 ==========
F-13 COMPS.COM, Inc. Notes to Financial Statements (continued) 6. Commitments Leases The Company leases its offices under operating leases which expire at various dates through June 2002. Under these operating leases, the Company pays taxes, insurance and maintenance expenses related to the premises. Certain of the leases provide for increasing minimum annual rental amounts. Rent payable for the Company's corporate headquarters office during the period from July 2000 through June 2002 will be determined based upon fair market rental value at July 1, 2000. Rent expense is recorded evenly over the term of the lease. Accordingly, deferred rent, as reflected on the accompanying balance sheets, represents the difference between rent expense accrued and amounts paid under the terms of the lease agreement. Rent expense for the years ended December 31, 1996, 1997 and 1998 totaled $410,705, $405,874 and $468,533, respectively. The Company leases certain equipment under capital lease obligations. Cost and accumulated depreciation of equipment under capital leases were $379,978 and $321,854, respectively, at December 31, 1998. Future minimum lease payments under operating and capital leases at December 31, 1998 are as follows:
Operating Capital Leases Leases --------- ------- 1999...................................................... $513,505 $54,463 2000...................................................... 256,144 15,714 2001...................................................... 92,603 8,890 2002...................................................... 81,294 -- -------- ------- Total minimum lease payments.............................. $943,546 79,067 ======== Less amount representing interest......................... 7,112 ------- Present value of minimum lease payments................... 71,955 Less current portion...................................... 49,343 ------- Noncurrent portion........................................ $22,612 =======
Employment, Incentive Compensation, and Stock Agreements The Company has employment and incentive compensation agreements with key employees which grant these employees the right to receive bonuses and incentive compensation upon certain events and circumstances as defined in the agreements. The agreements provide for severance pay of three to eight months in the event of termination of employment. 7. Information Sharing Agreement The Company has agreements to license its database to other information service providers for licensing through their computer networks. Under the agreements, the Company receives a certain percentage of the related annual gross receipts earned by these other service providers. In addition, neither the Company nor the other service providers shall develop competing products during the term of the agreement. The Company earned $307,381, $163,341 and $41,185 under the agreements during the years ended December 31, 1996, 1997 and 1998, respectively. F-14 COMPS.COM, Inc. Notes to Financial Statements (continued) 8. Redeemable Convertible Preferred Stock During 1994, the Company sold 4,270,336 shares of Series A convertible redeemable preferred stock and warrants to purchase 379,869 shares of Class B common stock at $.01 per share (Note 10), for $4,856,758, net of issuance costs of $143,242. The holders of the Series A preferred stock are entitled to receive cumulative dividends at an annual rate of $.07 per share, payable at the time of: 1) repurchase of Series A preferred stock; 2) liquidation of the Company; or 3) sale of the Company's securities pursuant to an underwritten public offering. The right to such dividends will be forfeited in the event of a repurchase of all of the outstanding shares of Series A preferred stock or a liquidation if the holders of the Series A preferred stock are entitled to receive in excess of $3.52 per share prior to the payment of dividends or upon a public offering of not less than $10 million at a purchase price of not less than $3.52 per share. Holders of Series A preferred stock have a liquidation preference of $1.17 per share plus all accumulated but unpaid dividends. In February 1998, the Company sold 637,790 shares of Series B redeemable convertible preferred stock and warrants to purchase 306,097 shares of Class B common stock and 37,329 shares of Class A common stock at $.01 per share (Note 10), for $1,137,151, net of issuance costs of $12,849. The holders of the Series B preferred stock are entitled to receive cumulative dividends at an annual rate of $0.11 per share, payable at the time of 1) repurchase of Series A or Series B preferred stock; 2) liquidation of the Company; or 3) sale of the Company's securities pursuant to an underwritten public offering. The right to such dividends will be forfeited in the event of a repurchase of all of the outstanding shares of Series B preferred stock or a liquidation if the holders of the Series B preferred stock are entitled to receive in excess of $3.83 per share prior to the payment of dividends or upon a public offering of not less than $10 million at a purchase price of not less than $3.83 per share. Holders of Series B preferred stock have a liquidation preference of $1.80 per share plus all accumulated but unpaid dividends. The Series A and Series B preferred stock is convertible at the option of the holder into an equal number of shares of Class A common stock. The holders of preferred and Class A common stock vote together as a class on all matters to be voted on by the shareholders of the Company, with each holder of preferred stock entitled to one vote for each share held. A summary of the redeemable convertible preferred stock and the liquidation and redemption values at December 31, 1998 are as follows:
Liquidation Redemption Shares Preference Value --------- ----------- ---------- Series A preferred stock................... 4,270,336 $5,000,000 $6,257,972 Series B preferred stock................... 637,790 1,150,000 1,214,311 --------- ---------- ---------- Total...................................... 4,908,126 $6,150,000 $7,472,283 ========= ========== ==========
9. Repurchase Agreement As part of the issuance of Series A and Series B redeemable convertible preferred stock and Class B common stock warrants, (see Note 10), the Company granted the purchasers a "put option" in which the Company is required to repurchase the shares held by the purchasers; the repurchase is required to take place in October 2001 or earlier if an event such as a liquidation or merger or acquisition occurs and there is a 50% change in the holders of voting securities. The repurchase price is the greater of the original purchase price plus accrued dividends or fair market value of the shares held. This put option is terminated if the Company has a public offering of its shares in which the Company's gross proceeds are at least $10 million and the per share price is not less the $3.52 for the Series A preferred stock and $3.83 for the Series B preferred stock. F-15 COMPS.COM, Inc. Notes to Financial Statements (continued) 9. Repurchase Agreement (continued) The purchasers have also been granted registration rights in certain conditions and a right of first refusal in the event the Company intends to sell shares in a private transaction. 10. Stockholders' Deficit Common Stock The Class A and Class B common stock shall have the same rights and privileges except that the Class B common stock shall not have any right to vote. Additionally, each share of Class B common stock shall automatically convert into one share of Class A common stock upon the earlier of the time of consent of the holders of at least 66 2/3% of the outstanding Class A common stock to the conversion is obtained or upon the closing of a public offering. Warrants In connection with the issuance of the Series A redeemable preferred stock, the Company issued warrants to purchase 379,869 shares of Class B common stock at $.01 per share. The warrants may be exercised in whole or in part on the earlier to occur of one day prior to the closing of a liquidity event, as defined in the agreement, or October 14, 2001. The warrants expire on October 14, 2004. In connection with the issuance of the Series B redeemable preferred stock, the Company issued warrants to purchase 306,097 shares of Class B common stock and 37,329 shares of Class A common stock at $0.01 per share. The warrants to purchase Class B common stock are exercisable at the earlier of (i) one day prior to the closing or effective time of a liquidity event, as defined in the warrant agreement, or (ii) October 14, 2001. The warrant to purchase Class A Common Stock is immediately exercisable. All warrants issued in connection with the Series B Preferred Stock expire on February 6, 2008. In connection with the loan agreement with Venture Lending & Leasing, Inc. (see Note 5), the Company issued a warrant to purchase 213,068 shares of the Company's Class B common stock at $1.76 per share, subject to antidilutive adjustments. The warrant expires on September 24, 2003. As set forth in SFAS 123, the warrant must be accounted for based on its fair value. Accordingly, the Company estimated the fair value of the warrant using the Black-Scholes option pricing model, however, no value was allocated to the warrant as the current estimated fair value was nominal. Stock Options In November 1998, the Company replaced its amended and restated stock option plan (Old Plan), under which options to purchase 1,008,000 shares of Class B common stock were outstanding, with the 1998 Equity Participation Plan and the 1998 Supplemental Option Plan (the 1998 Plans). Under the 1998 Plans, both incentive stock options and non-qualified stock options to purchase Class B common stock may be issued to key employees, board members and consultants of the Company. The aggregate number of shares which the Company is authorized to issue under the 1998 Plans, together with the aggregate number of shares which may be issued under the Old Plan is 2,792,083. Options granted under the Plans generally vest over five years, except for options issued to independent directors under the 1998 Plans which vest over four years, and are exercisable for a period of ten years from the date of grant. The board of directors may, in its discretion, accelerate the period during which an option granted to an employee or consultant vests. Generally, stock options are granted at a price which approximates the fair value of the shares at the date of grant as determined by the board of directors. F-16 COMPS.COM, Inc. Notes to Financial Statements (continued) 10. Stockholders' Deficit (continued) Stock Options (continued) The following table summarizes stock option activity:
Weighted Average Exercise Shares Price --------- -------- Outstanding at December 31, 1995......................... 709,909 $0.30 Granted................................................ 117,808 $0.30 Cancelled.............................................. (182,308) $0.30 --------- ----- Outstanding at December 31, 1996......................... 645,409 $0.30 Granted................................................ 333,841 $0.30 Cancelled.............................................. (94,500) $0.30 --------- ----- Outstanding at December 31, 1997......................... 884,750 $0.30 Granted................................................ 1,559,199 $1.15 Exercised.............................................. (43,500) $0.30 Cancelled.............................................. (15,000) $0.65 --------- ----- Outstanding at December 31, 1998......................... 2,385,449 $0.86 ========= =====
Included above are options to purchase a total of 149,775 shares of common stock which were issued outside of the Plans. In addition, 190,000 of the options granted in 1997 will become fully vested upon the closing of an initial public offering. At December 31, 1998, options to purchase 679,623 shares (including 138,275 shares related to options granted outside the Plans) are exercisable and 512,909 shares are available for future grant. Through December 31, 1998, the Company recorded deferred compensation expense for the difference between the exercise price and the fair value for financial statement presentation purposes of the Company's common stock, as determined in part by an independent valuation, for options granted during 1998. This deferred compensation aggregates to $2,655,985, which is being amortized over the vesting period of the related options. Amortization during 1998 was $117,564. Following is a further breakdown of the options outstanding as of December 31, 1998:
Weighted average Weighted average exercise price of Range of Options remaining life Weighted average Options options Exercise Prices Outstanding in years exercise price exercisable exercisable - --------------- ----------- ---------------- ---------------- ----------- ----------------- $0.30-$0.45 905,250 7.70 $0.31 350,313 $0.30 $1.00-$1.20 1,480,199 9.65 $1.19 329,310 $1.20 - ----------- --------- ---- ----- ------- ----- $0.30-$1.20 2,385,449 8.93 $0.86 679,623 $0.74
Pro forma information regarding net loss is required by SFAS 123, and has been determined as if the Company had accounted for its employee stock options under the fair value method of that Statement. The fair value of the options was estimated at the date of grant, using the "minimum value" method for option pricing with the following weighted-average assumptions for options granted in 1996, 1997 and 1998: risk-free interest rate of 6%, 6% and 5.5%, respectively; dividend yield of 0%; and a weighted-average expected life of options of five years. The weighted-average fair value of options granted in 1996, 1997 and 1998 was $0.08. $0.08 and $0.28, respectively. F-17 COMPS.COM, Inc. Notes to Financial Statements (continued) 10. Stockholders' Deficit (continued) Stock Options (continued) For purpose of pro forma disclosure, the estimated fair value of the options is amortized to expense over the options' vesting period. The Company's pro forma information is as follows:
Year ended December 31, ---------------------------------------- 1996 1997 1998 ------------ ------------ ------------ Pro forma net loss attributable to common stockholders.............. $ (2,615,089) $ (1,867,929) $ (1,939,328) Pro forma basic and diluted net loss per share attributable to common stockholders.............. $ (0.55) $ (0.39) $ (0.40)
Common Stock Reserved for Issuance At December 31, 1998, the Company has reserved shares of common stock for future issuance as follows: Stock options...................................................... 2,898,358 Preferred stock.................................................... 4,908,126 Warrants........................................................... 936,363 --------- 8,742,847 =========
11. Income Taxes At December 31, 1998, the Company had federal and state tax net operating loss carryforwards of approximately $4,942,000 and $2,494,000, respectively. The difference between the federal and California tax loss carryforwards is primarily attributable to the 50% limitation on California loss carryforwards. The federal and California tax loss carryforwards begin expiring in 2009 and 1999, respectively, unless previously utilized. Pursuant to Internal Revenue Code Section 382, use of the Company's net operating loss carryforwards may be limited if a cumulative change in ownership of more than 50% occurs within a three-year period. Significant components of the Company's deferred tax assets at December 31, 1997 and 1998 are shown below. A valuation allowance of $1,652,000 has been recognized to offset the deferred tax assets as realization of such assets is uncertain.
1997 1998 ---------- ---------- Deferred tax assets: Net operating loss carryforwards................... $1,343,000 $1,826,000 Other.............................................. 338,000 361,000 Amortization....................................... 464,000 463,000 ---------- ---------- Total deferred tax assets............................ 2,145,000 2,650,000 Deferred tax liabilities: Intangibles........................................ -- (998,000) ---------- ---------- Net deferred tax assets.............................. 2,145,000 1,652,000 Valuation allowance for deferred tax assets.......... (2,145,000) (1,652,000) ---------- ---------- Net deferred tax assets.............................. $ -- $ -- ========== ==========
F-18 COMPS.COM, Inc. Notes to Financial Statements (continued) 12. Employee Benefit Plan The Company has a 401(k) defined contribution employee benefit plan (the "Plan") for the benefit of eligible employees, generally those who have completed one year of service. The Company is not required to contribute to the Plan. In 1996, the Company did not contribute to the Plan. Contributions totaling $14,956 and $34,130 were charged to expense in 1997 and 1998, respectively. 13. Related Party Transactions The Company currently leases its corporate headquarters operating space from a limited partnership whose general partner is a company owned by the President and major stockholder of the Company. Another director and stockholder is a limited partner of this limited partnership. Rent expense to this related party of $253,684, $295,018 and $304,579 was incurred in 1996, 1997 and 1998, respectively. The Company retains the consulting services of one of its board of director members. Consulting expense to this related party of $57,000, $11,580 and $25,780 was incurred in 1996, 1997 and 1998, respectively. 14. Reportable Segments Description of the types of products and services from which each reportable segment derives its revenues The Company has two reportable segments: information services and transactions support services. Revenues for the Company's information services division are derived from licensing commercial real estate sales comparable information on a subscription and ad-hoc basis. Revenues of $16,500 for transaction support services were derived from REALBID, a marketing services company acquired in November 1998 which supports commercial real estate transactions over the Internet. Measurement of segment profit or loss and segment assets The Company evaluates performance and allocates resources based on profit or loss from operations before income taxes. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies. Factors management used to identify the enterprise's reportable segments The Company's reportable segments are business units that offer different products and services. The Company did not have reportable segments in prior years, and therefore only the information for the year ended December 31, 1998 is included below.
Year ended December 31, 1998 ----------------------------------- Transaction Information Support Services Services Totals ----------- ----------- ---------- Revenues from external customers...... 12,789,261 16,500 12,805,761 Intersegment revenues................. -- -- -- Interest expense...................... 302,152 -- 302,152 Depreciation and amortization expense.............................. 721,648 82,350 803,998 Segment profit (loss) before income taxes................................ (1,164,204) (384,118) (1,548,322) Other significant non cash item: Deferred compensation on stock options............................ 967,231 1,571,190 2,538,421 Segment assets Fixed assets, net................... 1,460,211 10,327 1,470,538 Intangible assets, net.............. -- 2,162,350 2,162,350 Expenditures of long-lived assets..... 922,749 11,127 933,876
F-19 COMPS.COM, Inc. Notes to Financial Statements (continued) 15. Subsequent Events In February 1999, the Company entered into a $1.8 million loan agreement with Venture Lending & Leasing, Inc., under which the Company may purchase both equipment and working capital. The borrowing base under the loan is limited to $1.8 million or 80% of the Company's eligible accounts. The loan agreement expires on March 31, 2000. In connection with the loan agreement, the Company issued a warrant to purchase a certain number of shares of Class B non-voting common stock with an aggregate initial exercise price of $225,000. The exercise price per share will be based on an amount equal to the median of i) $1.8031 and ii) the per share price in the next round of equity financing. If there is no new equity financing done within 18 months of the date of the loan agreement (February 12, 1999) the exercise price will be $2.70. The Company will account for this warrant in accordance with SFAS 123. In February 1999, the Company entered into a new lease agreement for its corporate headquarters. The new lease is with the same related party (see Note 13) and is effective February 1, 1999. The Company's prior lease, which was due to expire in June 2002 and provided for monthly rent payments of $37,015 will be canceled upon commencement of the new lease. The term of the new lease is 5 years, with the option to extend for five terms of two years each. The initial monthly rent payment of $44,843 will be increased by 3 1/2% each year during the original five year term. Upon commencement of each extension of the term, monthly base rent will be adjusted to reflect the fair market rental value. In February 1999, the Board of Directors adopted the 1999 Stock Incentive Plan and the 1999 Employee Stock Purchase Plan. The plans are effective on the date the underwriting agreement is signed in connection with the Company's contemplated initial public offering. Shares reserved for issuance under the 1999 Stock Incentive Plan and the 1999 Employee Stock Purchase Plan total 2,800,000 and 300,000, respectively. F-20 Report of Ernst & Young LLP, Independent Auditors The Members REALBID, LLC We have audited the accompanying statements of operations, members' equity (deficit) and cash flows of REALBID, LLC for the period from June 19, 1997 (inception) through December 31, 1997. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the results of operations and cash flows of REALBID, LLC for the period from June 19, 1997 (inception) through December 31, 1997, in conformity with generally accepted accounting principles. Ernst & Young LLP San Diego, California February 17, 1999 F-21 REALBID, LLC Statements of Operations
For the period from June 19, 1997 For the nine-month (inception) to period ended December 31, 1997 September 30, 1998 ----------------- ------------------ (unaudited) Net revenues............................... $ 15,500 $ 196,666 Cost of revenues........................... 9,615 37,608 --------- --------- Gross profit............................... 5,885 159,058 Operating expenses: General and administrative............... 247,598 271,477 --------- --------- Total operating expenses................... 247,598 271,477 --------- --------- Net loss................................... $(241,713) $(112,419) ========= =========
See accompanying notes. F-22 REALBID, LLC Statements of Members' Equity (Deficit)
Total Members' Shares Members' --------------- Accumulated Equity Shares Amount Deficit (Deficit) ------ ------ ----------- --------- Issuance of members' shares.............. 8,000 $8,000 $ -- $ 8,000 Net loss for the period from June 19, 1997 (inception) to December 31, 1997... -- -- (241,713) (241,713) ----- ------ --------- --------- Balance at December 31, 1997............. 8,000 8,000 (241,713) (233,713) Net loss for nine-month period ended September 30, 1998 (unaudited).......... -- -- (112,419) (112,419) ----- ------ --------- --------- Balance at September 30, 1998 (unaudited)............................. 8,000 $8,000 $(354,132) $(346,132) ===== ====== ========= =========
See accompanying notes. F-23 REALBID, LLC Statements of Cash Flows
For the period from June 19, 1997 For the nine-month (inception) to period ended December 31, 1997 September 30, 1998 ----------------- ------------------ (unaudited) Operating activities Net loss................................. $(241,713) $(112,419) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation........................... -- 699 Provision for bad debts................ -- 10,000 Changes in operating assets and liabilities: Accounts receivable.................. -- (79,000) Prepaid assets....................... -- (2,000) Accounts payable..................... 1,797 13,331 Accrued liabilities.................. 150,000 187,000 --------- --------- Net cash provided by (used in) operating activities.............................. (89,916) 17,611 Financing activities Payments on lease obligation............. -- (1,748) Proceeds from member advances............ 83,510 12,704 Proceeds from issuance of members' shares.................................. 8,000 -- --------- --------- Net cash provided by financing activities.............................. 91,510 10,956 --------- --------- Net increase in cash and cash equivalents............................. 1,594 28,567 Cash and cash equivalents at beginning of period.................................. -- 1,594 --------- --------- Cash and cash equivalents at end of period.................................. $ 1,594 $ 30,161 ========= ========= Supplemental disclosure of cash flow information: Interest paid............................ $ -- $ 176 Supplemental schedule of non cash investing and financing activities: Equipment financed under capital leases.. $ -- $ 8,713
See accompanying notes. F-24 REALBID, LLC Notes to Financial Statements December 31, 1997 (Information subsequent to December 31, 1997 and pertaining to the nine-month period ended September 30, 1998 is unaudited) 1. Organization and Summary of Significant Accounting Policies Organization and Business Activities REALBID, LLC (the "Company") is a California company with limited liability status which was formed on June 19, 1997 and shall continue until June 30, 2047 or until dissolution in accordance with the terms of the Operating Agreement. Each member's liability is limited pursuant to the Beverly-Killea Limited Liability Company Act. The Company is a real estate marketing services company which facilitates commercial property transactions using both the internet and traditional communication technologies. The Company's primary purpose is to provide computer on-line real estate services, including market data, specific property information, buyer profiles and a trading platform for private and public format transactions. Basis of Presentation The Company has an accumulated deficit at December 31, 1997 and has not yet generated income from operations and thus needs to continue to raise cash to fund future operations. Refer to Note 5 for subsequent event. Unaudited Interim Financial Information The financial statements for the nine months ended September 30, 1998 are unaudited. The unaudited financial statements have been prepared on the same basis as the audited financial statements, and in the opinion of management, include all adjustments, consisting only of normal recurring adjustments, necessary to state fairly the financial information set forth therein, in accordance with generally accepted accounting principles. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts of revenues and expenses reported during the period. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid investments with a remaining maturity of three months or less when acquired to be cash equivalents. Equipment Equipment is depreciated using the straight-line method over estimated useful lives of three to five years. Revenue Recognition The Company recognizes revenue at the time of performance of services. F-25 REALBID, LLC Notes to Financial Statements (continued) (Information subsequent to December 31, 1997 and pertaining to the nine-month period ended September 30, 1998 is unaudited) 1. Organization and Summary of Significant Accounting Policies (continued) Profits and Losses and Distributions Profits and losses of the Company are allocated to the members and distributions are made in accordance with the Operating Agreement. 2. Commitments During the nine months ended September 30, 1998, the Company leased its facilities under two operating leases expiring on November 30, 1998 and January 5, 1999, each of which was renewed for an additional six month term. Rent expense totaled $8,490 for the period from June 19, 1997 through December 31, 1997 and $24,914 for the nine-month period ended September 30, 1998. The Company leases certain equipment under capital leases obligations. The leases expire on March 27, 2000 and August 23, 2000. 3. Related Party Transactions Since inception and through the nine month period ended September 30, 1998, two of the Company's members have loaned the Company funds to be used for expenditures incurred by the Company in order to conduct business. At December 31, 1997 and at September 30, 1998, loan amounts due to members totaled $83,510 and $96,214, respectively. 4. Income Taxes Under federal and California law, income or loss of limited liability companies are passed through to the separate tax returns of the members. Accordingly, no provision (benefit) for taxes based on income or losses is shown in the accompanying financial statements. 5. Sale of Assets On November 6, 1998, COMPS.COM Inc. purchased substantially all of the assets of the Company for $163,000 and stock options granted to the members. 6. Year 2000 Compliance (Unaudited) Many currently installed computer systems and software products are coded to accept only two-digit entries in the date code filed. Beginning in the year 2000, these date code fields will need to accept four-digit entries to distinguish 21st century dates from 20th century dates. As a result, computer systems and/or software used by many companies may need to be upgraded to comply with such "Year 2000" requirements. Significant uncertainty exists concerning the potential effects associated with compliance. Although the Company believes that it is year 2000 compliant, there can be no assurance that coding errors or other defects will not be discovered in the future. Any year 2000 compliance problem of the Company, its service providers, its customers or the Internet infrastructure could result in a material adverse effect on the Company's business, operating results and financial condition. F-26 COMPS.COM, Inc. Unaudited Pro Forma Condensed Statement of Operations On November 6, 1998, the Company acquired REALBID, LLC (REALBID) for approximately $3.1 million, including acquisition costs. The unaudited pro forma condensed statement of operations for the year ended December 31, 1998 give effect to the acquisition of REALBID as if it had occurred on January 1, 1998. The pro forma condensed statement of operations is based on historical results of operations of the Company for the year ended December 31, 1998 and REALBID for the period from January 1, 1998 to November 5, 1998. The pro forma condensed statement of operations should be read in conjunction with the historical financial statements and notes thereto of the Company and REALBID. The pro forma condensed statement of operations is presented for illustrative purposes only and is not necessarily indicative of results of operations that would have actually occurred had the acquisition of REALBID been effected on January 1, 1998.
COMPS.COM, REALBID, LLC Inc. Period from Year ended January 1, 1998 December 31, to November 5, Pro Forma 1998 1998 Adjustments Pro Forma ------------ --------------- ----------- ----------- Net revenues............. $12,805,761 $ 223,166 -- $13,028,927 Cost of revenues......... 5,746,180 44,988 -- 5,791,168 ----------- --------- --------- ----------- Gross profit............. 7,059,581 178,178 -- 7,237,759 Operating expenses: Selling and marketing... 4,181,945 -- -- 4,181,945 Product development..... 1,230,349 -- -- 1,230,349 General and administrative......... 2,936,052 293,782 407,750 3,637,584 ----------- --------- --------- ----------- Total operating expenses................ 8,348,346 293,782 407,750 9,049,878 ----------- --------- --------- ----------- Loss from operations..... (1,288,765) (115,604) (407,750) (1,812,119) Other income (expense)... (259,557) -- -- (259,557) ----------- --------- --------- ----------- Net loss................. (1,548,322) (115,604) (407,750) (2,071,676) Dividend accretion on preferred stock......... 363,235 -- -- 363,235 ----------- --------- --------- ----------- Net loss attributable to common stockholders..... $(1,911,557) $(115,604) $(407,750) $(2,434,911) =========== ========= ========= =========== Net loss per share attributable to common stockholders, basic and diluted................. $ (0.40) (0.51) =========== =========== Shares used in computing net loss attributable to common stockholders, basic and diluted....... 4,794,896 4,794,896 =========== ===========
See accompanying notes. F-27 COMPS.COM, Inc. Notes to Unaudited Pro Forma Condensed Statement Of Operations Note 1. On November 6, 1998, COMPS.COM, Inc. (the Company) acquired all of the assets of REALBID, LLC (REALBID) for cash of $163,000 and options to acquire 544,612 shares of the Company's common stock at $1.20 per share. The fair value of the options was determined to be $3.84 per share as of the date of the acquisition. As a result, the purchase price is calculated to be $2,308,400, which includes acquisition costs of $54,400. The purchase price was allocated as follows, based upon a valuation of the tangible and intangible assets by an independent appraiser, as well as management's best estimates: Current assets acquired....................................... $ 64,500 Customer base................................................. 1,791,100 Database and website technology............................... 268,700 Assembled workforce........................................... 94,600 Trademark and trade name...................................... 89,500 ---------- $2,308,400
The intangible assets are being amortized over estimated useful lives ranging from three to five years. Note 2. The accompanying unaudited pro forma condensed statement of operations for the year ended December 31, 1998 gives effect to the acquisition of REALBID as if it had occurred as of January 1, 1998. The pro forma adjustment reflects twelve months of amortization expense. F-28 Inside Back Cover: NATIONAL COVERAGES [A map of the U.S. is shown. Nine icons are lined up across the top of the map. Below each icon is the name of one of the nine property types that we cover in our database. Each icon will have a picture of the property type that it represents. White dots are placed on the map in cities representing our current market. Red dots are placed on the map in cities representing the markets in our expansion plan. A legend is provided explaining the meaning of the dots. [LOGO] Outside back cover: RELIABLE COMMERCIAL REAL ESTATE [The back cover will consist of a dark background with white text. There will be a picture of a database wheel resembling a radar screen with a picture of a group of commercial real estate buildings inside the database wheel.] [LOGO] COMPS.COM, INC. www.comps.com PART II Information Not Required in Prospectus Item 13. Other Expenses of Issuance and Distribution The expenses to be paid by the registrant are as follows. All amounts other than the SEC registration fee, the NASD filing fees and the Nasdaq National Market listing fee are estimates.
Amount to be Paid -------- SEC registration fee............................................... $ 13,900 NASD filing fee.................................................... 5,500 Nasdaq National Market listing fee................................. 5,000 Legal fees and expenses............................................ 250,000 Accounting fees and expenses....................................... 200,000 Printing and engraving............................................. 120,000 Blue sky fees and expenses (including legal fees).................. 5,000 Transfer agent fees................................................ 10,000 Miscellaneous...................................................... 10,000 -------- Total.......................................................... $619,400 ========
Item 14. Indemnification of Directors and Officers Section 145 of the Delaware General Corporation Law authorizes a court to award, or a corporation's board of directors to grant, indemnity to directors and officers in terms sufficiently broad to permit such indemnification under certain circumstances for liabilities (including reimbursement for expenses incurred) arising under the Securities Act of 1933. As permitted by the Delaware General Corporation Law, the registrant's Second Restated Certificate of Incorporation includes a provision that eliminates the personal liability of its directors for monetary damages for breach of fiduciary duty as a director, except for liability (1) for any breach of the director's duty of loyalty to the registrant or its stockholders, (2) for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, (3) under section 174 of the Delaware General Corporation Law (regarding unlawful dividends and stock purchases) or (4) for any transaction from which the director derived an improper personal benefit. As permitted by the Delaware General Corporation Law, the bylaws of the registrant provide that (1) the registrant is required to indemnify its directors and officers to the fullest extent permitted by the Delaware General Corporation Law, subject to certain very limited exceptions, (2) the registrant may indemnify its other employees and agents as set forth in the Delaware General Corporation Law, (3) the registrant is required to advance expenses, as incurred, to its directors and executive officers in connection with a legal proceeding to the fullest extent permitted by the Delaware General Corporation Law, subject to certain very limited exceptions and (4) the rights conferred in the bylaws are not exclusive. The registrant has entered into indemnification agreements with each of its directors and executive officers to give such directors and officers additional contractual assurances regarding the scope of the indemnification set forth in the registrant's Amended and Restated Certificate of Incorporation and to provide additional procedural protections. At present, there is no pending litigation or proceeding involving a director, officer or employee of the registrant regarding which indemnification is sought, nor is the registrant aware of any threatened litigation that may result in claims for indemnification. II-1 Reference is also made to Section of the Underwriting Agreement, which provides for the indemnification of officers, directors and controlling persons of the registrant against certain liabilities. The indemnification provision in the registrant's Certificate of Incorporation, bylaws and the indemnification agreements entered into between the registrant and each of its directors and executive officers may be sufficiently broad to permit indemnification of the registrant's directors and executive officers for liabilities arising under the Securities Act of 1933. The registrant has applied for liability insurance for its officers and directors. Reference is made to the following documents filed as exhibits to this registration statement regarding relevant indemnification provisions described above and elsewhere in this prospectus:
Exhibit Document Number -------- ------- Underwriting Agreement (draft dated , 1999).................. 1.1 Form of Second Restated Certificate of Incorporation of Registrant...... 3.2 Form of Restated Bylaws of Registrant................................... 3.4 Form of Indemnification Agreement....................................... 10.22 Form of Indemnification Agreement....................................... 10.23
Item 15. Recent Sales of Unregistered Securities The registrant has sold and issued the following securities since January 1, 1996 (such share numbers do not reflect the -for- stock split): (1) The registrant from time to time has granted stock options to employees and consultants in reliance upon exemption from registration pursuant to either (1) Section 4(2) of the Securities Act of 1933 or (2) Rule 701 promulgated under the Securities Act of 1933. The following table sets forth certain information regarding such grants:
Number of Exercise Shares Prices --------- ----------- January 1, 1996 to December 31, 1996.................. 117,808 $0.30 January 1, 1997 to December 31, 1997.................. 333,841 $0.30 January 1, 1998 to December 31, 1998.................. 1,559,199 $0.45-$1.20
For additional information concerning these transactions, please see "Management--Benefit Plans" in the Prospectus included in this registration statement. (2) On September 24, 1996, we issued a warrant to purchase 213,068 shares of Class B common stock to Venture Lending & Leasing, Inc. in consideration for entering into a certain loan agreement. (3) On February 9, 1998, we issued 637,790 shares of Series B preferred stock, warrants to purchase 37,329 shares of Class A common stock and warrants to purchase 306,097 shares of Class B common stock to various venture capitalists and insiders for an aggregate consideration of $1,150,000. (4) On May 18, 1998, we issued 33,500 shares of Class B common stock to a director upon exercise of options for a consideration of $10,050. (5) On December 28, 1998, we issued 10,000 shares of Class B common stock to a director upon exercise of options for a consideration of $3,000. (6) On February 15, 1999, we issued a warrant to purchase no more than 124,309 shares of Class B common stock to Venture Lending & Leasing, Inc. in consideration for entering into a certain loan agreement. The above securities were offered and sold by the registrant in reliance upon exemptions from registration pursuant to either (1) Section 4(2) of the Securities Act of 1933 as transactions not involving any public offering, or (2) Rule 701 promulgated under the Securities Act of 1933. No underwriters were involved in connection with the sales of securities referred to in this Item 15. II-2 Item 16. Exhibits and Financial Statement Schedules (a) Exhibits.
Number Description ------ ----------------------------------------------------------------------- 1.1* Form of Underwriting Agreement. 3.1 Restated Certificate of Incorporation, as amended. 3.2 Form of Second Restated Certificate of Incorporation to be in effect upon the closing of this offering. 3.3 Bylaws. 3.4 Form of Restated Bylaws to be in effect upon the closing of this offering. 4.1* Specimen common stock certificate. 5.1* Opinion of Brobeck, Phleger & Harrison LLP. 10.1 Amended and Restated Investor Rights Agreement among us and certain of our stockholders, dated February 9, 1998. 10.2 Stock and Warrant Purchase Agreement among us and the purchasers identified in Exhibit A to the Agreement, dated October 14, 1994. 10.3 Stock and Warrant Purchase Agreement among us and the purchasers identified in Exhibit A to the Agreement, dated February 9, 1998. 10.4 Form of Class B Common Stock Warrant between us and the persons listed on the attached schedule, dated October 14, 1994. 10.5 Class A Common Stock Warrant issued to Christopher A. Crane, dated February 9, 1998. 10.6 Form of Class B Common Warrant between us and the persons listed on the attached schedule, dated February 9, 1998. 10.7 Warrant to Purchase 213,068 Shares of Class B Common Stock between us and Venture Lending & Leasing, Inc., dated September 24, 1996. 10.8 Loan Agreement between us and Venture Lending & Leasing, Inc., dated September 24, 1996. 10.9 Security Agreement between us and Venture Lending & Leasing, Inc., dated September 24, 1996. 10.10 Trademark Collateral Assignment between us and Venture Lending & Leasing, Inc., dated September 24, 1996. 10.11 Patent Collateral Assignment between us and Venture Lending & Leasing, Inc., dated September 24, 1996. 10.12 Form of Promissory Note between us and Venture Lending & Leasing, in such principal amounts as set forth on the attached schedule. 10.13 Form of Promissory Note between us and Venture Lending & Leasing, in such principal amounts as set forth on the attached schedule. 10.14 Office Building Lease between us and Comps Plaza Associates, L.P., dated January 31, 1999. 10.15 Form of Employment and Incentive Compensation Agreement between us and the employees listed on the attached schedule. 10.16 Executive Employment Agreement between us and Christopher A. Crane, dated October 14, 1994. 10.17 Form of Employment Agreement between us and the employees listed on the attached schedule, dated November 6, 1998. 10.18 Covenant Not to Compete between us and Robert C. Beasley, dated October 14, 1994. 10.19 Form of Non-Competition and Non-Disclosure Agreement between us and the parties listed on the attached schedule, dated November 6, 1998. 10.20 Form of Non-Competition and Non-Disclosure Agreement between us and the parties listed on the attached schedule, dated January 7, 1999. 10.21 Form of Employee Confidentiality and Inventions Agreement. 10.22 Form of Indemnification Agreement between us and each of our directors. 10.23 Form of Indemnification Agreement between us and each of our officers. 10.24 Software License Agreement between us and Qualitative Marketing Software, Inc., dated February 27, 1997. 10.25 License and Subscription Agreement between us and Transamerica Information Management Services, dated December 17, 1992.
II-3
Number Description ------ ----------------------------------------------------------------------- 10.26 License Agreement between us and NCompass Labs Inc., dated December 2, 1998. 10.27 Amended and Restated Stock Option Plan. 10.28 Form of Amended and Restated Stock Option Plan Incentive Stock Option Agreement. 10.29 Form of Amended and Restated Stock Option Plan Non-Qualified Stock Option Agreement. 10.30 The 1998 Equity Participation Plan. 10.31 Form of 1998 Equity Participation Plan Incentive Stock Option Agreement. 10.32 Form of 1998 Equity Participation Plan Non-Qualified Stock Option Agreement. 10.33 The 1998 Supplemental Option Plan. 10.34 1998 Supplemental Option Plan Form of Notice of Grant of Stock Option. 10.35 1999 Stock Incentive Plan. 10.36* Form of 1999 Stock Incentive Plan Notice of Grant. 10.37* Form of 1999 Stock Incentive Plan Stock Option Agreement. 10.38 Employee Stock Purchase Plan. 10.39 Assignment and Assumption Agreement between us and REALBID LLC, dated November 6, 1998. 10.40 Intellectual Property Assignment between us and REALBID LLC, dated November 6, 1998. 10.41 Service Mark Assignment between us and REALBID LLC, dated November 6, 1998. 10.42 Asset Purchase Agreement between us, The Land Sales Resource and Kitty Layne, dated July 17, 1995. 10.43+ Purchase Agreement between us and TRW Redi Property Data, dated August 31, 1995, as amended by the Addendum, dated November 20, 1997. 10.44+ Asset Purchase Agreement among us, REALBID LLC, Emmett DeMoss and Robert Potter, dated November 6, 1998. 10.45+ Asset Purchase Agreement between us and AOBR, Inc., dated December 4, 1998. 10.46 Loan and Security Agreement between us and Venture Lending & Leasing II, Inc., dated February 12, 1999. 10.47 Patent Collateral Assignment Agreement between us and Venture Lending & Leasing II, Inc., dated February 12, 1999. 10.48 Trademark Collateral Assignment between us and Venture Lending & Leasing II, Inc., dated February 12, 1999. 10.49 Warrant to Purchase an aggregate of $225,000 of Class B Shares of Common Stock between us and Venture Lending & Leasing II, Inc., dated February 12, 1999. 11.1* Statement re: Computation of Basic and Diluted Net Loss Per Share. 23.1 Consent of Ernst & Young LLP 23.2* Consent of Brobeck, Phleger & Harrison LLP (included in Exhibit 5.1) 24.1 Powers of Attorney (See Signature Page on Page II-6). 27.1 Financial Data Schedule.
- -------- * To be filed by amendment. + We have sought confidential treatment pursuant to Rule 406 of portions of the referenced exhibit. (b) Financial Statement Schedules. Schedule II--Valuation and Qualifying Accounts. All other schedules are omitted because they are not required, are not applicable or the information is included in our financial statements or notes thereto. Item 17. Undertakings The undersigned Registrant hereby undertakes to provide to the Underwriter at the closing specified in the Underwriting Agreement, certificates in such denominations and registered in such names as required by the Underwriter to permit prompt delivery to each purchaser. II-4 Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. The undersigned Registrant hereby undertakes that: (1) For purposes of determining any liability under the Securities Act of 1933 the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424 (b)(1) or (4), or 497(h) under the Securities Act of 1933 shall be deemed to be part of this registration statement as of the time it was declared effective. (2) For the purpose of determining any liability under the Securities Act of 1933 each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-5 Signatures Pursuant to the requirements of the Securities Act of 1933 the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in San Diego, California, on this 24th day of February, 1999. COMPS.COM, INC. By: /s/ Christopher A. Crane ---------------------------------- Name: Christopher A. Crane Title: President and Chief Executive Officer Power of Attorney We, the undersigned directors and/or officers of COMPS.COM, INC. hereby severally constitute and appoint Christopher A. Crane, President and Chief Executive Officer, and Karen Goodrum, Vice President of Finance and Administration and Chief Financial Officer, and each of them individually, with full powers of substitution and resubstitution, our true and lawful attorneys, with full powers to them and each of them to sign for us, in our names and in the capacities indicated below, the Registration Statement on Form S-1 filed with the SEC, and any and all amendments to said Registration Statement (including post-effective amendments), and any registration statement filed pursuant to Rule 462(b) under the Securities Act of 1933 in connection with the registration under the Securities Act of 1933 of our equity securities, and to file or cause to be filed the same, with all exhibits thereto and other documents in connection therewith, with the SEC, granting unto said attorneys, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as each of them might or could do in person, and hereby ratifying and confirming all that said attorneys, and each of them, or their substitute or substitutes, shall do or cause to be done by virtue of this Power of Attorney. Pursuant to the requirements of the Securities Act of 1933 this Registration Statement has been signed by the following persons in the capacities indicated on February 24, 1999:
Signature Title(s) Date --------- ------- ---- /s/ Christopher A. Crane Chairman of the Board, President and February 24, 1999 ____________________________________ Chief Executive Officer (principal Christopher A. Crane executive officer) /s/ Karen Goodrum Vice President of Finance and February 24, 1999 ____________________________________ Administration and Chief Financial Karen Goodrum Officer (principal financial and accounting officer) and Secretary /s/ Gregory M. Avis Director February 24, 1999 ____________________________________ Gregory M. Avis /s/ Robert C. Beasley Director February 24, 1999 ____________________________________ Robert C. Beasley
II-6 Consent of Ernst & Young LLP, Independent Auditors We consent to the reference to our firm under the captions "Selected Financial Data" and "Experts" and to the use of our report on the COMPS.COM, Inc. financial statements dated February 5, 1999 (except for Note 15, as to which the date is February 22, 1999) and our report on the REALBID, LLC financial statements dated February 17, 1999, in the Registration Statement (Form S-1) and related Prospectus of COMPS.COM, Inc. dated February 24, 1999. Our audits also included the financial statement schedule of COMPS.COM, Inc. for the three years ended December 31, 1998 listed in Item 16(b). This schedule is the responsibility of the Company's management. Our responsibility is to express an opinion based on our audits. In our opinion, the financial statement schedule referred to above, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein. Ernst & Young LLP San Diego, California February 23, 1999 II-7 Schedule II COMPS.COM, Inc. Valuation And Qualifying Accounts
Additions -------------------- Balance at Charged to Balance Allowance for Doubtful Beginning Costs and at End of Accounts of Year Expenses Other (1) Deductions Year - ---------------------- --------- ---------- --------- ---------- --------- Year ended December 31, 1996..................... 362,913 -- 644,322 437,109 570,126 Year ended December 31, 1997..................... 570,126 39,491 1,238,593 463,968 1,384,242 Year ended December 31, 1998..................... 1,384,242 167,858 260,627 347,805 1,464,922
- -------- (1) These amounts have been offset against deferred subscription revenue. II-8 Index to Exhibits
Number Description ------ ----------------------------------------------------------------------- 1.1* Form of Underwriting Agreement. 3.1 Restated Certificate of Incorporation, as amended. 3.2 Form of Second Restated Certificate of Incorporation to be in effect upon the closing of this offering. 3.3 Bylaws. 3.4 Form of Restated Bylaws to be in effect upon the closing of this offering. 4.1* Specimen common stock certificate. 5.1* Opinion of Brobeck, Phleger & Harrison LLP. 10.1 Amended and Restated Investor Rights Agreement among us and certain of our stockholders, dated February 9, 1998. 10.2 Stock and Warrant Purchase Agreement among us and the purchasers identified in Exhibit A to the Agreement, dated October 14, 1994. 10.3 Stock and Warrant Purchase Agreement among us and the purchasers identified in Exhibit A to the Agreement, dated February 9, 1998. 10.4 Form of Class B Common Stock Warrant between us and the persons listed on the attached schedule, dated October 14, 1994. 10.5 Class A Common Stock Warrant issued to Christopher A. Crane, dated February 9, 1998. 10.6 Form of Class B Common Warrant between us and the persons listed on the attached schedule, dated February 9, 1998. 10.7 Warrant to Purchase 213,068 Shares of Class B Common Stock between us and Venture Lending & Leasing, Inc., dated September 24, 1996. 10.8 Loan Agreement between us and Venture Lending & Leasing, Inc., dated September 24, 1996. 10.9 Security Agreement between us and Venture Lending & Leasing, Inc., dated September 24, 1996. 10.10 Trademark Collateral Assignment between us and Venture Lending & Leasing, Inc., dated September 24, 1996. 10.11 Patent Collateral Assignment between us and Venture Lending & Leasing, Inc., dated September 24, 1996. 10.12 Form of Promissory Note between us and Venture Lending & Leasing, in such principal amounts as set forth on the attached schedule. 10.13 Form of Promissory Note between us and Venture Lending & Leasing, in such principal amounts as set forth on the attached schedule. 10.14 Office Building Lease between us and Comps Plaza Associates, L.P., dated January 31, 1999. 10.15 Form of Employment and Incentive Compensation Agreement between us and the employees listed on the attached schedule. 10.16 Executive Employment Agreement between us and Christopher A. Crane, dated October 14, 1994. 10.17 Form of Employment Agreement between us and the employees listed on the attached schedule, dated November 6, 1998. 10.18 Covenant Not to Compete between us and Robert C. Beasley, dated October 14, 1994. 10.19 Form of Non-Competition and Non-Disclosure Agreement between us and the parties listed on the attached schedule, dated November 6, 1998. 10.20 Form of Non-Competition and Non-Disclosure Agreement between us and the parties listed on the attached schedule, dated January 7, 1999. 10.21 Form of Employee Confidentiality and Inventions Agreement. 10.22 Form of Indemnification Agreement between us and each of our directors. 10.23 Form of Indemnification Agreement between us and each of our officers. 10.24 Software License Agreement between us and Qualitative Marketing Software, Inc., dated February 27, 1997. 10.25 License and Subscription Agreement between us and Transamerica Information Management Services, dated December 17, 1992.
Number Description ------ ----------------------------------------------------------------------- 10.26 License Agreement between us and NCompass Labs Inc., dated December 2, 1998. 10.27 Amended and Restated Stock Option Plan. 10.28 Form of Amended and Restated Stock Option Plan Incentive Stock Option Agreement. 10.29 Form of Amended and Restated Stock Option Plan Non-Qualified Stock Option Agreement. 10.30 The 1998 Equity Participation Plan. 10.31 Form of 1998 Equity Participation Plan Incentive Stock Option Agreement. 10.32 Form of 1998 Equity Participation Plan Non-Qualified Stock Option Agreement. 10.33 The 1998 Supplemental Option Plan. 10.34 1998 Supplemental Option Plan Form of Notice of Grant of Stock Option. 10.35 1999 Stock Incentive Plan. 10.36* Form of 1999 Stock Incentive Plan Notice of Grant. 10.37* Form of 1999 Stock Incentive Plan Stock Option Agreement. 10.38 Employee Stock Purchase Plan. 10.39 Assignment and Assumption Agreement between us and REALBID LLC, dated November 6, 1998. 10.40 Intellectual Property Assignment between us and REALBID LLC, dated November 6, 1998. 10.41 Service Mark Assignment between us and REALBID LLC, dated November 6, 1998. 10.42 Asset Purchase Agreement between us, The Land Sales Resource and Kitty Layne, dated July 17, 1995. 10.43+ Purchase Agreement between us and TRW Redi Property Data, dated August 31, 1995, as amended by the Addendum, dated November 20, 1997. 10.44+ Asset Purchase Agreement between us, REALBID LLC, Emmett DeMoss and Robert Potter, dated November 6, 1998. 10.45+ Asset Purchase Agreement among us and AOBR, Inc., dated December 4, 1998. 10.46 Loan and Security Agreement between us and Venture Lending & Leasing II, Inc., dated February 12, 1999. 10.47 Patent Collateral Assignment Agreement between us and Venture Lending & Leasing II, Inc., dated February 12, 1999. 10.48 Trademark Collateral Assignment between us and Venture Lending & Leasing II, Inc., dated February 12, 1999. 10.49 Warrant to Purchase an aggregate of $225,000 of Class B Shares of Common Stock between us and Venture Lending & Leasing II, Inc., dated February 12, 1999. 11.1* Statement re: Computation of Basic and Diluted Net Loss Per Share. 23.1 Consent of Ernst & Young LLP 23.2* Consent of Brobeck, Phleger & Harrison LLP (included in Exhibit 5.1) 24.1 Powers of Attorney (See Signature Page on Page II-6). 27.1 Financial Data Schedule.
- -------- * To be filed by amendment. + We have sought confidential treatment pursuant to Rule 406 of portions of the referenced exhibit. EX-3.1 2 RESTATED CERTIFICATE OF INCORPORATION, AS AMENDED EXHIBIT 3.1 RESTATED CERTIFICATE OF INCORPORATION OF COMPS INFOSYSTEMS, INC. A DELAWARE CORPORATION COMPS INFOSYSTEMS, INC., a corporation organized and existing under the laws of the State of Delaware (the "Corporation"), hereby certifies as follows: ONE: The name of this Corporation is COMPS INFOSYSTEMS, INC. The original Certificate of Incorporation of the Corporation was filed with the Secretary of State of Delaware on September 1, 1994. The Certificate of Incorporation was later amended and restated and filed with the Delaware Secretary of State on October 13, 1994. TWO: Pursuant to Sections 242 and 245 of the General Corporation Law of the State of Delaware, this Restated Certificate of Incorporation restates and integrates and further amends the provisions of the Restated Certificate of Incorporation of this Corporation. THREE: The text of the Restated Certificate of Incorporation as heretofore in effect is hereby restated and further amended to read in its entirety as follows: ARTICLE I --------- The name of the Corporation is COMPS InfoSystems, Inc. (the "Corporation"). ARTICLE II ---------- The address of the registered office of the Corporation in the State of Delaware is 1013 Centre Road, City of Wilmington, Delaware. The name of the registered agent at that address is The Prentice Hall Corporation System, Inc., County of New Castle. ARTICLE III ----------- The purpose of the Corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of Delaware. ARTICLE IV ---------- The Corporation is authorized to issue two classes of shares to be designated respectively "Preferred Stock" and "Common Stock." The total number of shares of Preferred Stock par value $.01 per share, which are authorized is 5,000,000. The total number of shares of Common Stock, par value $.01 per share, which are authorized is 25,000,000. A. Common Stock. The first series of Common Stock shall be comprised of ------------ 22,500,000 shares designated "Class A Common Stock." The second series of Common Stock shall be comprised of 2,500,000 shares of Common Stock designated "Class B Common Stock." 1 The Class A and Class B Common Stock shall have the same rights and privileges except as provided below: 1. Voting. The Class B Common Stock shall not have any right to vote ------ unless otherwise required by law. 2. Conversion. Each share of Class B Common Stock shall automatically ---------- convert into one share of Class A Common Stock upon the earlier to occur of (i) the time the consent of at least 66 2/3% of the outstanding Class A Common Stock to such conversion is obtained, or (ii) closing of the sale of the Corporation's securities pursuant to an underwritten public offering. Upon conversion of the Class B Common Stock, the Class A Common Stock shall be renamed "Common Stock." (a) In case the Corporation shall at any time (i) subdivide the outstanding Class A Common Stock, or (ii) issue a stock dividend on its outstanding Class A Common Stock, the number of shares of Class B Common Stock issuable upon conversion of the Class B Common Stock immediately prior to such subdivision or the issuance of such stock dividend shall be proportionately increased by the same ratio as the subdivision or dividend. In case the Corporation shall at any time combine its outstanding Class A Common Stock, the number of shares of Class B Common Stock issuable upon conversion of the Class B Common Stock immediately prior to such combination shall be proportionately decreased by the same ratio as the combination. All such adjustments described herein shall be effective at the close of business on the date of such subdivision, stock dividend or combination, as the case may be. (b) In case of any capital reorganization (other than in connection with a merger or other reorganization which the Corporation is not the continuing or surviving entity) or any reclassification of the Common Stock of the Corporation, the Class B Common Stock shall thereafter be convertible into that number of shares of stock or other securities or property to which a holder of the number of shares of Class A Common Stock of the Corporation deliverable upon conversion of the shares of Class B Common Stock immediately prior to such reorganization or recapitalization would have been entitled upon such reorganization or reclassification. B. Preferred Stock. The first series of Preferred Stock shall be --------------- comprised of 4,270,336 shares designated as "Series A Preferred Stock." The second series of Preferred Stock shall be comprised of 637,790 shares designated as "Series B Preferred Stock." The relative rights, preferences, restrictions and other matters relating to the Series A Preferred Stock and Series B Preferred Stock are as follows: 1. Dividend Rights of Preferred. The holders of Preferred Stock shall ---------------------------- be entitled to receive, out of any assets at the time legally available therefor, cumulative non-compounded dividends from the date of issuance at the rate per annum of $0.07025 per share (subject to adjustments for stock splits, dividends, recapitalizations and the like) of Series A Preferred Stock and $0.10808 per share (subject to adjustments for stock splits, dividends, recapitalization and the like) of Series B Preferred Stock, payable immediately prior to the effective time of (i) any repurchase of the Series A Preferred Stock or Series B Preferred Stock; (ii) any liquidation pursuant to Section B(2)(b) of this Article IV, or (iii) any sale of the 2 Corporation's securities pursuant to an underwritten public offering, provided, -------- however, that the right to receive such accrued and unpaid dividends shall - ------- forfeit with respect to a particular Series of Preferred Stock in the event of (x) a repurchase of all of the outstanding shares of a series of Preferred Stock (each series with shares still outstanding retains such right) or a liquidation pursuant to Section B(2)(b) of this Article IV, if the aggregate amount to be received by the holders of the Series A Preferred Stock and Series B Preferred Stock prior to the payment of such accrued and unpaid dividends would exceed $3.52 and $3.83 per share, respectively, (as adjusted for stock-splits, combinations, reorganizations and the like) or (y) with respect only to the Series A Preferred Stock, an underwritten public offering of the Corporation's securities if the Corporation receives gross proceeds of not less than $10,000,000 at a purchase price of not less than $3.52 per share (as adjusted for stock splits, stock dividends, reorganizations and the like), and with respect only to the Series B Preferred Stock, an underwritten public offering of the Corporation's securities of the Corporation receives gross proceeds of not less than $10,000,000 at a purchase price of not less than $3.83 per share (as adjusted for stock splits, stock dividends, reorganizations and the like). Upon conversion of the Preferred Stock any accrued but unpaid dividends shall remain accrued and shall remain payable pursuant to this Section B(1) of this Article IV. In addition to the cumulative dividends specified above, no cash dividends shall be paid on any Common Stock unless an equal dividend is paid with respect to all outstanding shares of Preferred Stock in an amount for each such share of Preferred Stock equal to the aggregate amount of such dividends for all Common Stock into which each such share of Preferred Stock could then be converted. 2. Preference on Liquidation. ------------------------- (a) In the event of any liquidation, dissolution or winding up of the Corporation, distributions to the stockholders of the Corporation shall be made in the following manner: (i) The holders of the Preferred Stock shall be entitled to receive, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to the holders of the Common Stock by reason of their ownership of such stock, the amount of (A) $1.17087 per share for each share of Series A Preferred Stock and $1.80310 per share for each share of Series B Preferred Stock then held by them, adjusted for any stock split, combination, consolidation, or stock distributions or stock dividends with respect to such shares, and (B) an amount equal to all accumulated but unpaid dividends on the Preferred Stock as provided in Subsection 1 above. If the assets and funds thus distributed among the holders of the Preferred Stock shall be insufficient to permit the payment to such holders of the full aforesaid preferential amount, then the entire assets and funds of the Corporation legally available for distribution shall be distributed ratably among the holders of the Preferred Stock, pari passu, in proportion to their aggregate ---- ----- preferential amounts. (ii) The remaining assets of the Corporation, after payment in full to the holders of Preferred Stock of all amounts exclusively payable on or with respect to said shares, shall be distributed ratably among the holders of the Common Stock. (b) The following shall be deemed to be a liquidation, dissolution or winding up within the meaning of this Subsection: (i) an acquisition, consolidation or merger of 3 this Corporation with or into any other corporation or corporations unless the stockholders of the Corporation prior to such transaction directly or indirectly own more than fifty percent (50%) of the voting stock of the surviving or acquiring corporation or corporations; (ii) the sale, transfer or other disposition of all or substantially all of the assets of this Corporation to a person other than a corporation or partnership controlled by the Corporation or its stockholders; and (iii) the effectuation by the Corporation of a transaction or series of related transactions in which more than 50% of the outstanding voting power of the Corporation prior to such transaction or series of related transactions is disposed of. (c) In the event the Corporation shall propose to take any action of the type described in subsection (a) or (b) of this Subsection 2, the Corporation shall, within ten (10) days after the date the Board of Directors approves such action or twenty (20) days prior to any stockholders' meeting called to approve such action, whichever is earlier, give each holder of shares of the Preferred Stock written notice of the proposed action. Such written notice shall describe the material terms and conditions of such proposed action, including a description of the stock, cash and property to be received by the holders of shares of the Preferred Stock upon consummation of the proposed action and the proposed date of delivery thereof. If any material change in the facts set forth in the notice shall occur, the Corporation shall promptly give written notice to each holder of shares of the Preferred Stock of such material change. (d) The Corporation shall not consummate any proposed action of the type described in subsection (a) or (b) of this Subsection 2 before the expiration of thirty (30) days after the mailing of the initial written notice or ten (10) days after the mailing of any subsequent written notice, whichever is later; provided, however, that any such 30-day or 10-day period may be -------- ------- shortened upon the written consent of the holders of a majority of the outstanding shares of the Preferred Stock. (e) If the Corporation shall propose to take any action of the type described in subsection (a) or (b) of this Subsection 2 which will involve the distribution of assets other than cash, the Corporation shall, if requested by the holders of a majority of the Preferred Stock, promptly engage independent competent appraisers to determine the value of the assets to be distributed to the holders of shares of the Preferred Stock and the Common Stock. The Corporation shall, upon receipt of such appraiser's valuation, give prompt written notice of the appraiser's valuation to each holder of shares of the Preferred Stock. 3. Voting. ------ (a) Except as set forth in paragraph (b) of this Subsection 3 and in Subsection 6 hereof, or as otherwise required by law, the shares of the Preferred Stock shall be voted together with the Corporation's Class A Common Stock at any annual or special meeting of the stockholders of the Corporation, or may act by written consent in the same manner as the Corporation's Class A Common Stock; and shall have the voting rights and powers equal to the voting right of the Class A Common Stock, upon the following basis: each holder of shares of Preferred Stock shall be entitled to such number of votes for the Preferred Stock held by him on the record date fixed for such meeting or, if no record date is established, at the date such vote is taken or on the effective date of any such written consent, as shall be equal to the nearest whole number of shares of the Corporation's Common Stock into which his shares of Preferred Stock 4 are convertible immediately after the close of business on the record date fixed for such meeting, the date of such vote or the effective date of such written consent. (b) The holders of Series A and Series B Preferred Stock, voting together as a separate class, shall be entitled to elect one director. The election of a director by the holders of the Preferred Stock shall occur at the annual meeting of holders of Common Stock or at any special meeting of holders of Preferred Stock called by holders of a majority of the outstanding shares of Preferred Stock or by the written consent of all such holders. If the person elected by the holders of Preferred Stock should cease to be a director for any reason, the vacancy shall only be filled by the vote or written consent of holders of a majority of the outstanding shares of Preferred Stock. The holders of the Common Stock shall be entitled to elect the remaining directors. 4. Status of Converted or Redeemed Stock. In the event that any shares ------------------------------------- of Preferred Stock shall be converted pursuant to Subsection 5 hereof or shall be repurchased or otherwise acquired by the Corporation in any manner whatsoever, such shares shall be retired and canceled promptly after the acquisition thereof. Such shares shall not be reissued as shares of any series of Preferred Stock. Upon such cancellation, and upon the filing of any certificates required or appropriate under applicable law, the number of authorized shares of Preferred Stock as set forth in Article IV, shall be reduced by the number of such shares so canceled. 5. Conversion Rights. The holders of Preferred Stock shall have ----------------- conversion rights as follows: (a) Each share of Preferred Stock shall be convertible, at the option of the holder thereof, at any time at the principal office of the Corporation or any transfer agent for such shares, into fully paid and nonassessable shares of Class A Common Stock of the Corporation. The number of shares of Class A Common Stock into which each share of Preferred Stock may be converted shall be determined by dividing $1.17087 for the Series A Preferred Stock and $1.80310 for the Series B Preferred Stock by the Conversion Price determined as hereinafter provided in effect at the time of the conversion. The Conversion Price per share at which shares of Class A Common Stock shall be initially issuable upon conversion of any shares of Preferred Stock shall be $1.17087 for the Series A Preferred Stock and $1.80310 for the Series B Preferred Stock, subject to adjustment as provided herein. (b) Each share of Preferred Stock shall be converted into Class A Common Stock automatically in the manner provided herein upon the earlier to occur of (i) the time the consent of holders of at least 66-2/3% of the outstanding Preferred Stock to such conversion is obtained, or (ii) the closing of the sale of the Corporation's securities pursuant to an underwritten public offering from which the Corporation receives gross proceeds of not less than $10,000,000 at a purchase price of not less than $3.73 per share (as adjusted for stock splits, stock dividends, reorganizations and the like). (c) Before any holder of Preferred Stock shall be entitled to convert the same into Common Stock, such holder shall surrender the certificate or certificates therefor, duly endorsed in blank or accompanied by proper instruments of transfer, at the principal office of the Corporation or of any transfer agent for the Preferred Stock, and shall give written notice 5 to the Corporation at such office that such holder elects to convert the same and shall state in writing therein the name or names in which such holder wishes the certificate or certificates for Common Stock to be issued. As soon as practicable thereafter, the Corporation shall issue and deliver at such office to such holder's nominee or nominees, certificates for the number of whole shares of Common Stock to which such holder shall be entitled. No fractional shares of Common Stock shall be issued by the Corporation and all such fractional shares shall be disregarded. In lieu thereof, the Corporation shall pay in cash the fair market value of such fractional share as determined by the Board of Directors of the Corporation. Such conversion shall be deemed to have been made as of the date of such surrender of the Preferred Stock to be converted, and the person or persons entitled to receive the Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such Common Stock on said date. (d) In case the Corporation shall at any time (i) subdivide (i.e. stock split) the outstanding Common Stock, or (d) issue a stock dividend on its outstanding Common Stock, the number of shares of Common Stock issuable upon conversion of the Preferred Stock immediately prior to such subdivision or the issuance of such stock dividend shall be proportionately increased by the same ratio as the subdivision or dividend (with appropriate adjustments in the Conversion Price of the Preferred Stock). In case the Corporation shall at any time combine (i.e. reverse stock split) its outstanding Common Stock, the number of shares of Common Stock issuable upon conversion of the Preferred Stock immediately prior to such combination shall be proportionately decreased by the same ratio as the combination (with appropriate adjustments in the Conversion Price of the Preferred Stock). All such adjustments described herein shall be effective at the close of business on the date of such subdivision (i.e. stock split), stock dividend or combination (i.e. reverse stock split), as the case may be. (e) In case of any capital reorganization (other than in connection with a merger or other reorganization in which the Corporation is not the continuing or surviving entity) or any reclassification of the Common Stock of the Corporation, the Preferred Stock shall thereafter be convertible into that number of shares of stock or other securities or property to which a holder of the number of shares of Common Stock of the Corporation deliverable upon conversion of the shares of Preferred Stock immediately prior to such reorganization or recapitalization would have been entitled upon such reorganization or reclassification. In any such case, appropriate adjustment (as determined by the Board of Directors) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Preferred Stock, such that the provisions set forth herein shall thereafter be applicable, as nearly as reasonably may be, in relation to any share of stock or other property thereafter deliverable upon the conversion. (f) In case: (i) the Corporation shall take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend, or any other distribution, payable otherwise than in cash; or 6 (ii) the Corporation shall take a record of the holders of its Common Stock for the purpose of entitling them to subscribe for or purchase any shares of stock of any class or to receive any other rights; or (iii) the Corporation shall effect a capital reorganization of the Corporation, reclassification of the capital stock of the Corporation (other than a subdivision or combination of its outstanding Common Stock), consolidation or merger of the Corporation (other than a merger or other reorganization in which the Corporation is not the continuing or surviving entity); then, and in any such case, the Corporation shall cause to be mailed to the holders of its outstanding Preferred Stock, at least twenty (20) days prior to the date hereinafter specified, a notice stating the date on which a record is to be taken for the purpose of such dividend, distribution or rights, or such action is to be taken in connection with such reorganization, reclassification, merger or consolidation. (g) The Corporation shall at all times reserve and keep available out of its authorized but unissued Common Stock, solely for the purpose of effecting the conversion of the Preferred Stock, the full number of shares of Common Stock deliverable upon the conversion of all Preferred Stock from time to time outstanding. The Corporation shall from time to time (subject to obtaining necessary director and stockholder action), in accordance with the laws of the State of Delaware, increase the authorized amount of its Common Stock if at any time the authorized number of shares of Common Stock remaining unissued shall not be sufficient to permit the conversion of all of the shares of Preferred Stock at the time outstanding. (h) Upon the issuance by the Corporation of Common Stock, or any right or option to purchase Common Stock, or any obligation or any shares of stock convertible into or exchangeable for Common Stock for a consideration per share less than the Conversion Price of a series of Preferred Stock in effect immediately prior to the time of such issue or sale other than the issuance of shares of Common Stock upon conversion of such series of Preferred Stock, then forthwith upon such issue or sale, the Conversion Price of such series of Preferred Stock shall be reduced to a price (calculated to nearest cent) determined by dividing: (i) an amount equal to the sum of (x) the number of shares of Common Stock outstanding immediately prior to such issue or sale multiplied by the then existing Conversion Price of the affected series of Preferred Stock, (y) the number of shares of Common Stock issuable upon conversion of any shares of stock of the Corporation outstanding immediately prior to such issue or sale multiplied by the then existing Conversion Price of the affected series of Preferred Stock, and (z) an amount equal to the aggregate consideration received by the Corporation upon such issue or sale, by (ii) the sum of the number of shares of Common Stock outstanding immediately after such issue or sale and the number of shares of Common Stock (without taking into account any adjustment in such number resulting from such issue or sale) issuable upon conversion of any shares of stock of the Corporation outstanding immediately after such issue or sale. 7 For purposes of this subsection (h) the following provisions shall be applicable: (1) In the case of an issue or sale for cash of shares of Common Stock, the consideration received by the Corporation therefor shall be deemed to be the amount of cash received, before deducting therefrom any commissions or expenses paid or incurred by the Corporation. (2) In case of the issuance (otherwise than upon conversion or exchange of obligations or shares of stock of the Corporation) of additional shares of Common Stock for a consideration other than cash or a consideration partly other than cash, the amount of the consideration other than cash received by the Corporation for such shares shall be deemed to be the value of such consideration as reasonably determined by the Board of Directors. (3) In case of the issuance by the Corporation in any manner of any rights to subscribe for or to purchase shares of Common Stock, at a consideration per share (as computed below) less than the Conversion Price in effect for a series of Preferred Stock immediately prior to the date of the offering of such rights or the granting of such options, as the case may be, the maximum number of shares of Common Stock to which the holders of such rights or options shall be entitled to subscribe for or purchase pursuant to such rights or options shall be deemed to be issued or sold as of the date of the offering of such rights or the granting of such options, as the case may be, and the minimum aggregate consideration named in such rights or options for the shares of Common Stock covered thereby, plus the consideration, if any, received by the Corporation for such rights or options, shall be deemed to be the consideration actually received by the Corporation (as of the date of the offering of such rights or the granting of such options, as the case may be) for the issuance of such shares. (4) In case of the issuance or issuances by the Corporation in any manner of any obligations or of any shares of stock of the Corporation that shall be convertible into or exchangeable for Common Stock, at a consideration per share (as computed below) less than the Conversion Price in effect for a series of Preferred Stock immediately prior to the date such obligation or shares are issued, the maximum number of shares of Common Stock issuable upon the conversion or exchange of such obligations or shares shall be deemed issued as of the date such obligations or shares are issued, and the amount of the consideration received by the Corporation for such additional shares of Common Stock will be deemed to be the total of the amount of consideration received by the Corporation upon the issuance of such obligations or shares, as the case may be, plus the minimum aggregate consideration, if any, other than such obligations or shares, receivable by the Corporation upon such conversion or exchange, except in adjustment of dividends. (5) The amount of the consideration received by the Corporation upon the issuance of any rights or options referred to in subsection (3) above or upon the issuance of any obligations or shares which are convertible or exchangeable as describes in subsection (4) above, and the amount of the consideration, if any, other than such obligations or shares so convertible or exchangeable, receivable by the Corporation upon the exercise, conversion or exchange thereof shall be determined in the same manner provided in subsections (h)(1) and (2) above with respect to the consideration received by the Corporation in 8 case of the issuance of additional shares of Common Stock. On the expiration of any rights or options referred to in subsection (3), or the termination of any right of conversion or exchange referred to in subsection (4), the Conversion Price then in effect for a series of Preferred Stock shall forthwith be readjusted to such Conversion Price as would have obtained had the adjustments made upon the issuance of such option, right or convertible or exchangeable securities been made upon the basis of the delivery of only the number of shares of Common Stock actually delivered upon the exercise of such rights or options or upon the conversion or exchange of such securities. (6) Anything herein to the contrary notwithstanding, the Corporation shall not be required to make any adjustment of the Conversion Price in the case of (A) the sale and issuance by the Corporation of up to 1,944,909 shares of Common Stock or rights or options to purchase shares of Common Stock, net of repurchases and expired or canceled options, (as adjusted for stock splits, stock dividends, reorganizations and the like) to officers, directors, employees, consultants and equipment lessors to the Corporation; (B) the issuance of Common Stock upon the conversion of outstanding Preferred Stock; or (C) the issuance of up to 723,295 shares of Common Stock upon the exercise of Warrants issued to the holders of Preferred Stock. (i) Upon the occurrence of each adjustment or readjustment of the Conversion Price for any series of Preferred Stock pursuant to this Subsection 5, the Corporation at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Preferred Stock a certificate setting forth such adjustment or readjustment showing in detail the facts upon which such adjustment or readjustment is based. The Corporation shall, upon the reasonable written request at any time of any holder of Preferred Stock, furnish or cause to be furnished to such holder a like certificate setting forth (i) such adjustments and readjustments, and (ii) the number of shares of Common Stock and the amount, if any, of other property which at the time would be received upon the conversion of the Preferred Stock. (j) In the event the Corporation at any time or from time to time makes, or fixes a record date for the determination of holders of Common Stock entitled to receive any distribution payable in securities or other property of the Corporation other than Common Stock and other than as otherwise adjusted in this Subsection 5, then and in each such event provision shall be made so that the holders of Preferred Stock shall receive upon conversion thereof, in addition to the number of shares of Common Stock receivable thereupon, the amount of securities and other property of the Corporation which they would have received had their shares of Preferred Stock been converted into shares of Common Stock on the date of such event and had they thereafter, during the period from the date of such event to and including the date of conversion; retained such securities and other property receivable by them as aforesaid during such period, subject to all other adjustments called for during such period under this Subsection 5 with respect to the rights of the holders of Preferred Stock. (k) Any notices required by the provisions of this Subsection 5 to be given to the holders of shares of Preferred Stock shall be deemed given if deposited in the United States mail, first class, postage prepaid and addressed to each holder of record at its address appearing on the books of the Corporation. 9 6. Changes. So long as shares of Preferred Stock are outstanding, the ------- Corporation shall not, without first obtaining the approval by vote or written consent, in the manner provided by law, of the holders of at least a majority of the total number of shares of Series A and Series B Preferred Stock outstanding, voting together as a single Class: (1) alter or change any of the powers, preferences, privileges or rights of any series of Preferred Stock; (2) increase the authorized number of shares of Preferred Stock; (3) amend the provisions of this Section 6; (4) undertake or effect any consolidation or merger of the Corporation with or into another corporation or any acquisition by or the conveyance of all or substantially all of the assets of the Corporation to another person; (5) create any new series of Preferred Stock; (6) amend this Certificate of Incorporation of the Corporation; (7) declare or pay any dividends on the Corporation's capital stock, (8) redeem or repurchase any outstanding stock other than from employees, consultants or directors upon the termination of their employment or services pursuant to agreements providing for such repurchases; or (9) increase the size of the Board of Directors to more than four directors. ARTICLE V --------- The following provisions are inserted for the management of the business and the conduct of the affairs of the Corporation, and for further definition, limitation and regulation of the powers of the Corporation and of its directors and stockholders: A. The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. In addition to the powers and authority expressly conferred upon them by statute or by this Restated Certificate of Incorporation or the By-laws of the Corporation, the directors are hereby empowered to exercise all such powers and do all such acts and things as may be exercised or done by the Corporation. B. The directors of the Corporation need not be elected by written ballot unless the Bylaws so provide. ARTICLE VI ---------- A. The number of directors shall initially be four (4) and, thereafter, subject to the rights of the holders of any outstanding series of Preferred Stock, shall be fixed from time to time exclusively by the Board of Directors pursuant to a resolution adopted by a majority of the total number of authorized directors (whether or not there exist any vacancies in previously authorized directorships at the time any such resolution is presented to the Board for adoption). Subject to the rights of the holders of any series of Preferred Stock then outstanding, a vacancy resulting from the removal of a director by the stockholders as provided in Article VI, Section C below may be filled at a special meeting of the stockholders held for that purpose in accordance with Article IV, Section B.3(b). All directors shall hold office until the expiration of the term for which elected, and until their respective successors are elected, except in the case of the death, resignation, or removal of any director. B. Subject to the rights of the holders of any series of Preferred Stock then outstanding, newly created directorships resulting from any increase in the authorized number of directors or any vacancies in the Board of Directors resulting from death, resignation or other 10 cause (other than removal from office by a vote of the stockholders) may be filled only by a majority vote of the directors then in office, though less than a quorum, and directors so chosen shall hold office for a term expiring at the next annual meeting of stockholders at which the term of office of the class to which they have been elected expires, and until their respective successors are elected, except in the case of the death, resignation, or removal of any director. No decrease in the number of directors constituting the Board of Directors shall shorten the term of any incumbent director. C. Subject to the rights of the holders of any series of Preferred Stock then outstanding, any directors, or the entire Board of Directors, may be removed from office at any time, with or without cause, but only by the affirmative vote of the holders of at least a majority of the voting power of all of the then outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class. Vacancies in the Board of Directors resulting from such removal may be filled by a majority of the directors then in office, though less than a quorum or by the stockholders as provided in Article VI, Section A above. Directors so chosen shall hold office for a term expiring at the next annual meeting of stockholders at which the term of office of the class to which they have been elected expires, and until their respective successors are elected, except in the case of the death, resignation or removal of any director. ARTICLE VII ----------- The Board of Directors is expressly empowered to adopt amend or repeal By- laws of the Corporation. Any adoption, amendment or repeal of By-laws of the Corporation by the Board of Directors shall require the approval of a majority of the total number of authorized directors (whether or not there exist any vacancies in previously authorized directors at the time any resolution providing for adoption, amendment or repeal is presented to the Board). The stockholders shall also have power to adopt, amend or repeal the By-laws of the Corporation. Any adoption, amendment or repeal of By-laws of the Corporation by the stockholders shall require, in addition to any vote of the holders of any class or series of stock of the Corporation required by law or by this Certificate of Incorporation, the affirmative vote of the holders of at least sixty-six and two-thirds percent (66-2/3%) of the voting power of all of the then outstanding shares of the capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class. ARTICLE VIII ------------ A director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involved intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law, or (iv) for any transaction from which the director derived an improper personal benefit. If the Delaware General Corporation Law is hereafter amended to authorize the further elimination or limitation of the liability of a director, then the liability of a director of the 11 Corporation shall be eliminated or limited to the fullest extent permitted by the Delaware General Corporation Law, as so amended. Any repeal or modification of the foregoing provisions of this Article VIII by the stockholders of the Corporation shall not adversely affect any right or protection of a director of the Corporation existing at the time of such repeal or modification. ARTICLE IX ---------- The Corporation shall to the fullest extent permitted by Section 145 of the General Corporation Law of the State of Delaware, as the same may be amended and supplemented, indemnify any and all persons whom it shall have power to indemnify under said section from and against any and all of the expenses, liabilities or other matters referred to in or covered by said section, and the indemnification provided for herein shall not be deemed exclusive of any other rights to which those indemnified may be entitled under bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such person. ARTICLE X --------- The Corporation reserves the right to amend or repeal any provision contained in this Restated Certificate of Incorporation in the manner prescribed by the laws of the State of Delaware and all rights conferred upon stockholders are granted subject to this reservation; provided, however, that, -------- ------- notwithstanding any other provision of this Restated Certificate of Incorporation or any provision of law which might otherwise permit a lesser vote or no vote, but in addition to any vote of the holders of any class or series of the stock of this Corporation required by law or by this Restated Certificate of Incorporation, the affirmative vote of the holders of at least 66-2/3% of the voting power of all of the then outstanding shares of the capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class, shall be required to amend or repeal this Article X, Article V, Article VI, Article VII, Article VIII, or Article IX. The foregoing Restated Certificate of Incorporation has been approved by the Board of Directors of the Corporation. The foregoing Restated Certificate of Incorporation has been approved by the outstanding shares of the Corporation in accordance with Sections 242 and 245 of the Delaware General Corporation Law. IN WITNESS WHEREOF, this Restated Certificate of Incorporation has been executed by the undersigned duly authorized officer of the Corporation on this 4th day of February, 1998. /s/ CHRISTOPHER A. CRANE -------------------------------------- Christopher A. Crane, President 12 CERTIFICATE OF AMENDMENT OF RESTATED CERTIFICATE OF INCORPORATION OF COMPS INFOSYSTEMS, INC. COMPS INFOSYSTEMS, INC., a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware, DOES HEREBY CERTIFY: FIRST: That the Board of Directors of said corporation, by the unanimous written consent of its members, filed with the minutes of the Board, adopted a resolution proposing and declaring advisable the following amendment to the Restated Certificate of Incorporation of said corporation: RESOLVED, that the Restated Certificate of Incorporation of COMPS Infosystems, Inc. be amended by changing Article IV thereof so that, as amended, said Article shall read in its entirety as follows: "ARTICLE IV The Corporation is authorized to issue two classes of shares to be designated respectively "Preferred Stock" and "Common Stock." The total number of shares of Preferred Stock, par value $.01 per share, which are authorized is 5,000.000. The total number of shares of Common Stock, par value $.01 per share, which are authorized is 25,000,000. A. Common Stock. The first series of Common Stock shall be comprised of ------------ 22,500,000 shares designated "Class A Common Stock." The second series of Common Stock shall be comprised of 2,500,000 shares of Common Stock designated "Class B Common Stock." The Class A and Class B Common Stock shall have the same rights and privileges except as provided below. 1. Voting. The Class B Common Stock shall not have any right to vote ------ unless otherwise required by law. 2. Conversion. Each share of Class B Common Stock shall automatically ---------- convert into one share of Class A Common Stock upon the earlier to occur of (i) the time the consent of at least 66 2/3% of the outstanding Class A Common Stock to such conversion is obtained, or (ii) closing of the sale of the Corporation's securities pursuant to an underwritten public offering. Upon conversion of the Class B Common Stock, the Class A Common Stock shall be renamed "Common Stock." (a) In case the Corporation shall at any time (i) subdivide the outstanding Class A Common Stock or (ii) issue a stock dividend on its outstanding Class A Common Stock, the number of shares of Class B Common Stock issuable upon conversion of the Class B Common Stock immediately prior to such subdivision or the issuance of such stock dividend shall be proportionately increased by the same ratio as the subdivision or dividend. In case the Corporation shall at any time combine its outstanding Class A Common Stock, the number of shares of Class B Common Stock issuable upon conversion of the Class B Common Stock immediately prior to such combination shall be proportionately decreased by the same ratio as the combination. All such adjustments described herein shall be effective at the close of business on the date of such subdivision, stock dividend or combination, as the case may be. (b) In case of any capital reorganization (other than in connection with a merger or other reorganization which the Corporation is not the continuing or surviving entity) or any reclassification of the Common Stock of the Corporation, the Class B Common Stock shall thereafter be convertible into that number of shares of stock or other securities or property to which a holder of the number of shares of Class A Common Stock of the Corporation deliverable upon conversion of the shares of Class B Common Stock immediately prior to such reorganization or recapitalization would have been entitled upon such reorganization or reclassification. B. Preferred Stock. The first series of Preferred Stock shall be --------------- comprised of 4,270,336 shares designated as "Series A Preferred Stock." The second series of Preferred Stock shall be comprised of 637,790 shares designated as "Series B Preferred Stock." The relative rights, preferences, restrictions and other matters relating to the Series A Preferred Stock and Series B Preferred Stock are as follows: 1. Dividend Rights of Preferred. The holders of Preferred Stock shall ---------------------------- be entitled to receive, out of any assets at the time legally available therefor, cumulative non-compounded dividends from the date of issuance at the rate per annum of $0.07025 per share (subject to adjustments for stock splits, dividends, recapitalizations and the like) of Series A Preferred Stock and $0.10808 per share (subject to adjustments for stock splits, dividends, recapitalizations and the like) of Series B Preferred Stock, payable immediately prior to the effective time of (i) any repurchase of the Series A Preferred Stock or Series B Preferred Stock; (ii) any liquidation pursuant to Section B(2)(b) of this Article IV; or (iii) any sale of the Corporation's securities pursuant to an underwritten public offering; provided, however, that the right -------- ------- to receive such accrued and unpaid dividends shall forfeit with respect to a particular Series of Preferred Stock in the event of (x) a repurchase of all of the outstanding shares of a series of Preferred Stock (each series with shares still outstanding retains such right) or a liquidation pursuant to Section B(2)(b) of this Article IV, if the aggregate amount to be received by the holders of the Series A Preferred Stock and Series B Preferred Stock prior to the payment of such accrued and unpaid dividends would exceed $3.52 and $3.83 per share, respectively, (as adjusted for stock splits, combinations, reorganizations and the like) or (y) with respect only to the Series A Preferred Stock, an underwritten public offering of the Corporation's securities if the Corporation receives gross proceeds of not less than $10,000,000 at a purchase price of not less than $3.52 per share (as adjusted for stock splits, stock dividends, reorganizations and the like), and with respect only to Series B Preferred Stock, an underwritten public offering of the Corporation's securities if the Corporation receives gross proceeds of not less than $10,000,000 at a purchase price of not less than $3.83 per share (as adjusted for stock splits, stock dividends, reorganizations and the like). Upon conversion of the Preferred Stock any accrued but unpaid dividends shall remain accrued and shall remain payable pursuant to this Section B(l) of this Article IV. In addition to the cumulative dividends specified above, no cash dividends shall be paid on any Common Stock unless an equal dividend is paid with respect to all outstanding shares of Preferred Stock in an amount for each such share of Preferred Stock equal to the aggregate amount of such dividends for all Common Stock into which each such share of Preferred Stock could then be converted. 2. Preference on Liquidation. ------------------------- (a) In the event of any liquidation, dissolution or winding up of the Corporation, distributions to the stockholders of the Corporation shall be made in the following manner: (i) The holders of Preferred Stock shall be entitled to receive, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to the holders of the Common Stock by reason of their ownership of such stock, the amount of (A) $1.17087 per share for each share of Series A Preferred Stock and $1.80310 per share for each share of Series B Preferred Stock then held by them, adjusted for any stock split, combination, consolidation, or stock distributions or stock dividends with respect to such shares, and (B) an amount equal to all accumulated but unpaid dividends on the Preferred Stock as provided in Subsection 1 above. If the assets and funds thus distributed among the holders of the Preferred Stock shall be insufficient to permit the payment to such holders of the full aforesaid preferential amount, then the entire assets and funds of the Corporation legally available for distribution shall be distributed ratably among the holders of the Preferred Stock, pari passu, in proportion to their aggregate preferential ---- ----- amounts. (ii) The remaining assets of the Corporation, after payment in full to the holders of Preferred Stock of all amounts exclusively payable on or with respect to said shares, shall be distributed ratably among the holders of the Common Stock. (b) The following shall be deemed to be a liquidation, dissolution or winding up within the meaning of this Subsection: (i) an acquisition, consolidation or merger of this Corporation with or into any other corporation or corporations unless the stockholders of the Corporation prior to such transaction directly or indirectly own more than fifty percent (50%) of the voting stock of the surviving or acquiring corporation or corporations, (ii) the sale, transfer or other disposition of all or substantially all of the assets of this Corporation to a person other than a corporation or partnership controlled by the Corporation or its stockholders; and (iii) the effectuation by the Corporation of a transaction or series of related transactions in which more than 50% of the outstanding voting power of the Corporation prior to such transaction or series of related transactions is disposed of. (c) In the event the Corporation shall propose to take any action of the type described in subsection (a) or (b) of this Subsection 2, the Corporation shall, within ten (10) days after the date the Board of Directors approves such action or twenty (20) days prior to any stockholders' meeting called to approve such action, whichever is earlier, give each holder of shares of the Preferred Stock written notice of the proposed action. Such written notice shall describe the material terms and conditions of such proposed action, including a description of the stock, cash and property to be received by the holders of shares of the Preferred Stock upon consummation of the proposed action and the proposed date of delivery thereof. If any material change in the facts set forth in the notice shall occur, the Corporation shall promptly give written notice to each holder of shares of the Preferred Stock of such material change. (d) The Corporation shall not consummate any proposed action of the type described in subsection (a) or (b) of this Subsection 2 before the expiration of thirty (30) days after the mailing of the initial written notice or ten (10) days after the mailing of any subsequent written notice, whichever is later; provided, however, that any such 30-day or 10-day period may be -------- ------- shortened upon the written consent of the holders of a majority of the outstanding shares of the Preferred Stock. (e) If the Corporation shall propose to take any action of the type described in subsection (a) or (b) of this Subsection 2 which will involve the distribution of assets other than cash, the Corporation shall, if requested by the holders of a majority of the Preferred Stock, promptly engage independent competent appraisers to determine the value of the assets to be distributed to the holders of shares of the Preferred Stock and the Common Stock. The Corporation shall, upon receipt of such appraiser's valuation, give prompt written notice of the appraiser's valuation to each holder of shares of the Preferred Stock. 3. Voting. ------ (a) Except as set forth in paragraph (b) of this Subsection 3 and in Subsection 6 hereof, or as otherwise required by law, the shares of the Preferred Stock shall be voted together with the Corporation's Class A Common Stock at any annual or special meeting of the stockholders of the Corporation, or may act by written consent in the same manner as the Corporation's Class A Common Stock, and shall have the voting rights and powers equal to the voting rights of the Class A Common Stock, upon the following basis: each holder of shares of Preferred Stock shall be entitled to such number of votes for the Preferred Stock held by him on the record date fixed for such meeting, or, if no record date is established, as the date such vote is taken or on the effective date of any such written consent, as shall be equal to the nearest whole number of shares of the Corporation's Common Stock into which his shares of Preferred Stock are convertible immediately after the close of business on the record date fixed for such meeting, the date of such vote or the effective date of such written consent. (b) The holders of Series A and Series B Preferred Stock, voting together as a separate class, shall be entitled to elect one director. The election of a director by the holders of the Preferred Stock shall occur at the annual meeting of holders of Common Stock or at any special meeting of holders of Preferred Stock called by holders of a majority of the outstanding shares of Preferred Stock or by the written consent of all such holders. If the person elected by the holders of Preferred Stock should cease to be a director for any reason, the vacancy shall only be filled by the vote or written consent of holders of a majority of the outstanding shares of Preferred Stock. The holders of the Common Stock shall be entitled to elect the remaining directors. 4. Status of Converted or Redeemed Stock. In the event that any ------------------------------------- shares of Preferred Stock shall be converted pursuant to Subsection 5 hereof or shall be repurchased or otherwise acquired by the Corporation in any manner whatsoever, such shares shall be retired and canceled promptly after the acquisition thereof. Such shares shall not be reissued as shares of any series of Preferred Stock. Upon such cancellation, and upon the filing of any certificates required or appropriate under applicable law, the number of authorized shares of Preferred Stock as set forth in Article IV, shall be reduced by the number of such shares so canceled. 5. Conversion Rights. The holders of Preferred Stock shall have ----------------- conversion rights as follows: (a) Each share of Preferred Stock shall be convertible, at the option of the holder thereof, at any time at the principal office of the Corporation or any transfer agent for such shares, into fully paid and nonassessable shares of Class A Common Stock of the Corporation. The number of shares of Class A Common Stock into which each share of Preferred Stock may be converted shall be determined by dividing $1.17087 for the Series A Preferred Stock and $1.80310 for the Series B Preferred Stock by the Conversion Price determined as hereinafter provided in effect at the time of the conversion. The Conversion Price per share at which shares of Class A Common Stock shall be initially issuable upon conversion of any shares of Preferred Stock shall be $1.17087 for the Series A Preferred Stock and $1.80310 for the Series B Preferred Stock, subject to adjustment as provided herein. (b) Each share of Preferred Stock shall be converted into Class A Common Stock automatically in the manner provided herein upon the earlier to occur of (i) the time the consent of holders of at least 66 2/3% of the outstanding Preferred Stock to such conversion is obtained, or (ii) the closing of the sale of the Corporation's securities pursuant to an underwritten public offering from which the Corporation receives gross proceeds of not less than $10,000,000 at a purchase price of not less than $3.73 per share (as adjusted for stock splits, stock dividends, reorganizations and the like). (c) Before any holder of Preferred Stock shall be entitled to convert the same into Common Stock, such holder shall surrender the certificate of certificates therefor, duly endorsed in blank or accompanied by proper instruments of transfer, at the principal office of the Corporation or of any transfer agent for the Preferred Stock, and shall give written notice to the Corporation at such office that such holder elects to convert the same and shall state in writing therein the name or names in which such holder wishes the certificate or certificates for Common Stock to be issued. As soon as practicable thereafter, the Corporation shall issue and deliver at such office to such holder's nominee or nominees, certificates for the number of whole shares of Common Stock to which such holder shall be entitled. No fractional shares of Common Stock shall be issued by the Corporation and all such fractional shares shall be disregarded. In lieu thereof, the Corporation shall pay in cash the fair market value of such fractional share as determined by the Board of Directors of the Corporation. Such conversion shall be deemed to have been made as of the date of such surrender of the Preferred Stock to be converted, and the person or persons entitled to receive the Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such Common Stock on said date. (d) In case the Corporation shall at any time (i) subdivide (i.e., stock split) the outstanding Common Stock or (ii) issue a stock dividend on its outstanding Common Stock, the number of shares of Common Stock issuable upon conversion of the Preferred Stock immediately prior to such subdivision or the issuance of such stock dividend shall be proportionately increased by the same ratio as the subdivision or dividend (with appropriate adjustments in the Conversion Price of the Preferred Stock). In case the Corporation shall at any time combine (i.e. reverse stock split) its outstanding Common Stock, the number of shares of Common Stock issuable upon conversion of the Preferred Stock immediately prior to such combination shall be proportionately decreased by the same ratio as the combination (with appropriate adjustments in the Conversion Price of the Preferred Stock). All such adjustments described herein shall be effective at the close of business on the date of such subdivision (i.e. stock split), stock dividend or combination (i.e. reverse stock split), as the case may be. (e) In case of any capital reorganization (other than in connection with a merger or other reorganization in which the Corporation is not the continuing or surviving entity) or any reclassification of the Common Stock of the Corporation, the Preferred Stock shall thereafter be convertible into that number of shares of stock or other securities or property to which a holder of the number of shares of Common Stock of the Corporation deliverable upon conversion of the shares of Preferred Stock immediately prior to such reorganization or recapitalization would have been entitled upon such reorganization or reclassification. In any such case, appropriate adjustment (as determined by the Board of Directors) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Preferred Stock, such that the provisions set forth herein shall thereafter be applicable, as nearly as reasonably may be, in relation to any share of stock or other property thereafter deliverable upon the conversion. (f) In case: (i) the Corporation shall take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend, or any other distribution payable otherwise than in cash; or (ii) the Corporation shall take a record of the holders of its Common Stock for the purpose of entitling them to subscribe for or purchase any shares of stock of any class or to receive any other rights; or (iii) the Corporation shall effect a capital reorganization of the Corporation, reclassification of the capital stock of the Corporation (other than a subdivision or combination of its outstanding Common Stock), consolidation or merger of the Corporation (other than a merger or other reorganization in which the Corporation is not the continuing surviving entity); then, and in any such case, the Corporation shall cause to be mailed to the holders of its outstanding Preferred Stock, at least twenty (20) days prior to the date hereinafter specified, a notice stating the date on which a record is to be taken for the purpose of such dividend, distribution or rights, or such action is to be taken in connection with such reorganization, reclassification, merger or consolidation. (g) The Corporation shall at all times reserve and keep available, out of its authorized but unissued Common Stock, solely for the purpose of effecting the conversion of the Preferred Stock, the full number of shares of Common Stock deliverable upon the conversion of all Preferred Stock from time to time outstanding. The Corporation shall from time to time (subject to obtaining necessary director and stockholder action), in accordance with the laws of the State of Delaware, increase the authorized amount of its Common Stock if at any time the authorized number of shares of Common Stock remaining unissued shall not be sufficient to permit the conversion of all of the shares of Preferred Stock at the time outstanding. (h) Upon the issuance by the Corporation of Common Stock, or any right or option to purchase Common Stock, or any obligation or any shares of stock convertible into or exchangeable for Common Stock for a consideration per share less than the Conversion Price of a series of Preferred Stock in effect immediately prior to the time of such issue or sale other than the issuance of shares of Common Stock upon conversion of such series of Preferred Stock, then forthwith upon such issue or sale, the Conversion Price of such series of Preferred Stock shall be reduced to a price (calculated to nearest cent) determined by dividing: (i) an amount equal to the sum of (x) the number of shares of Common Stock outstanding immediately prior to such issue or sale multiplied by the then existing Conversion Price of the affected series of Preferred Stock, (y) the number of shares of Common Stock issuable upon conversion of any shares of stock of the Corporation outstanding immediately prior to such issue or sale multiplied by the then existing Conversion Price of the affected series of Preferred Stock, and (z) an amount equal to the aggregate consideration received by the Corporation upon such issue or sale, by (ii) the sum of the number of shares of Common Stock outstanding immediately after such issue or sale and the number of shares of Common Stock (without taking into account any adjustment in such number resulting from such issue or sale) issuable upon conversion of any shares of stock of the Corporation outstanding immediately after such issue or sale. For purposes of this subsection (h) the following provisions shall be applicable: (1) In the case of an issue or sale for cash of shares of Common Stock, the consideration received by the Corporation therefor shall be deemed to be the amount of cash received, before deducting therefrom any commissions or expenses paid or incurred by the Corporation. (2) In case of the issuance (otherwise than upon conversion or exchange of obligations or shares of stock of the Corporation) of additional shares of Common Stock for a consideration other than cash or a consideration partly other than cash, the amount of the consideration other than cash received by the Corporation for such shares shall be deemed to be the value of such consideration as reasonably determined by the Board of Directors. (3) In case of the issuance by the Corporation in any manner of any rights to subscribe for or to purchase shares of Common Stock, at a consideration per share (as computed below) less than the Conversion Price in effect for a series of Preferred Stock immediately prior to the date of the offering of such rights or the granting of such options, as the case may be, the maximum number of shares of Common Stock to which the holders of such rights or options shall be entitled to subscribe for or purchase pursuant to such rights or options shall be deemed to be issued or sold as of the date of the offering of such right or the granting of such options, as the case may be, and the minimum aggregate consideration named in such rights or options for the shares of Common Stock covered thereby, plus the consideration, if any, received by the Corporation for such rights or options, shall be deemed to be the consideration actually received by the Corporation (as of the date of the offering of such rights or the granting of such options, as the case may be) for the issuance of such shares. (4) In case of the issuance or issuances by the Corporation in any manner of any obligations or of any shares of stock of the Corporation that shall be convertible into or exchangeable for Common Stock, at a consideration per share (as computed below) less than the Conversion Price in effect for a series of Preferred Stock immediately prior to the date such obligation or shares are issued, the maximum number of shares of Common Stock issuable upon the conversion or exchange of such obligations or shares shall be deemed issued as of the date such obligations or shares are issued, and the amount of the consideration received by the Corporation for such additional shares of Common Stock shall be deemed to be the total of the amount of consideration received by the Corporation upon the issuance of such obligations or shares, as the case may be, plus the minimum aggregate consideration, if any, other than such obligations or shares, receivable by the Corporation upon such conversion of exchange, except in adjustment of dividends. (5) The amount of the consideration received by the Corporation upon the issuance of any rights or options refereed to in subsection (3) above or upon the issuance of any obligations or shares which are convertible or exchangeable as described in subsection (4) above, and the amount of the consideration, if any, other than such obligations or shares so convertible or exchangeable, receivable by the Corporation upon the exercise, conversion or exchange thereof shall be determined in the same manner provided in subsections (h)(1) and (2) above with respect to the consideration received by the Corporation in case of the issuance of additional shares of Common Stock. On the expiration of any rights or options referred to in subsection (3), or the termination of any right of conversion or exchange referred to in subsection (4), the Conversion Price then in effect for a series of Preferred Stock shall forthwith be readjusted to such Conversion Price as would have been obtained had the adjustments made upon the issuance of such option, right or convertible or exchangeable securities been made upon the basis of the delivery of only the number of shares of Common Stock actually delivered upon the exercise of such rights or options or upon the conversion or exchange of such securities. (6) Anything herein to the contrary notwithstanding, the Corporation shall not be required to make any adjustment of the Conversion Price in the case of (A) the sale and issuance by the Corporation of up to 2,994,909 shares of Common Stock or rights or options to purchase shares of Common Stock, net of repurchases and expired or canceled options, (as adjusted for stock splits, stock dividends, reorganizations and the like) to officers, directors, employees, consultants and equipment lessors to the Corporation; (B) the issuance of Common Stock upon the conversion of outstanding Preferred Stock; or (C) the issuance of up to 723,295 shares of Common Stock upon the exercise of Warrants issued to the holders of Preferred Stock. (i) Upon the occurrence of each adjustment or readjustment of the Conversion Price for any series of Preferred Stock pursuant to this Subsection 5, the Corporation at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Preferred Stock a certificate setting forth such adjustment or readjustment showing in detail the facts upon which such adjustment or readjustment is based. The Corporation shall, upon the reasonable written request at any time of any holder of Preferred Stock, furnish or cause to be furnished to such holder a like certificate setting forth (i) such adjustments and readjustments, and (ii) the number of shares of Common Stock and the amount, if any, of other property which at the time would be received upon the conversion of the Preferred Stock. (j) In the event the Corporation at any time or from time to time makes, or fixes a record date for the determination of holders of Common Stock entitled to receive any distribution payable in securities or other property of the Corporation other than Common Stock and other than as otherwise adjusted in this Subsection 5, then and in each such event provision shall be made so that the holders of Preferred Stock shall receive upon conversion thereof, in addition to the number of shares of Common Stock receivable thereupon, the amount of securities and other property of the Corporation which they would have received had their shares of Preferred Stock been converted into shares of Common Stock on the date of such event and had they thereafter, during the period from the date of such event to and including the date of conversion, retained such securities and other property receivable by them as aforesaid during such period, subject to all other adjustments called for during such period under this Subsection 5 with respect to the rights of the holders of Preferred Stock. (k) Any notices required by the provisions of this Subsection 5 to be given to the holders of shares of Preferred Stock shall be deemed given if deposited in the United States mail, first class, postage prepaid and addressed to each holder of record at its address appearing on the books of the Corporation. 6. Changes. So long as shares of Preferred Stock are outstanding, the ------- Corporation shall not without first obtaining the approval by vote or written consent, in the manner provided by law, of the holders of at least a majority of the total number of shares of Series A and Series B Preferred Stock outstanding, voting together as a single class; (1) alter or change any of the powers, preferences, privileges or rights of any series of Preferred Stock; (2) increase the authorized number of shares of Preferred Stock; (3) amend the provisions of this Section 6; (4) undertake or effect any consolidation or merger of the Corporation with or into another corporation or any acquisition by or the conveyance of all or substantially all of the assets of the Corporation to another person; (5) create any new series of Preferred Stock; (6) amend this Certificate of Incorporation of the Corporation; (7) declare or pay any dividends on the Corporation's capital stock; (8) redeem or repurchase any outstanding stock other than from employees, consultants or directors upon the termination of their employment or services pursuant to agreements providing for such repurchases; or (9) increase the size of the Board of Directors to more than four directors." SECOND: That in lieu of a meeting and vote of stockholders, a majority of the outstanding stock entitled to vote on this amendment and a majority of the outstanding stock of each class entitled to vote on this amendment as a class have given their written consent to said amendment in accordance with the provisions of Section 228 of the General Corporation Law of the State of Delaware. THIRD: That the aforesaid amendment was duly adopted in accordance with Sections 242 and 228 of the General Corporation Law of the State of Delaware. Dated: October 29, 1998 COMPS INFOSYSTEMS, INC. By: /s/ CHRISTOPHER A. CRANE --------------------------------- Christopher A. Crane, President CERTIFICATE OF AMENDMENT OF RESTATED CERTIFICATE OF INCORPORATION OF COMPS INFOSYSTEMS, INC. COMPS INFOSYSTEMS, INC., a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware, DOES HEREBY CERTIFY: FIRST: That the Board of Directors of said corporation, by the unanimous written consent of its members, filed with the minutes of the Board, adopted a resolution proposing and declaring advisable the following amendment to the Restated Certificate of Incorporation of said corporation: WHEREAS, it is deemed to be in the best interest of the Corporation and its stockholders to amend the Corporation's Restated Certificate of Incorporation. THEREFORE, BE IT RESOLVED, that the Corporation's Restated Certificate of Incorporation be amended by changing Article I thereof so that, as amended, said Article I shall read as follows: "ARTICLE I The name of the Corporation is COMPS.COM, INC." SECOND: That in lieu of a meeting and vote of stockholders, a majority of the outstanding stock entitled to vote on this amendment and a majority of the outstanding stock of each class entitled to vote on this amendment as a class have given their written consent to said amendment in accordance with the provisions of Section 228 of the General Corporation Law of the State of Delaware. THIRD: That the aforesaid amendment was duly adopted in accordance with Sections 242 and 228 of the General Corporation Law of the State of Delaware. Dated: December 31, 1998 COMPS INFOSYSTEMS, INC. By: /s/ CHRISTOPHER A. CRANE ------------------------------- Christopher A. Crane, President EX-3.2 3 FORM OF 2ND RESTATED CERT. OF INCORPORATION EXHIBIT 3.2 FORM OF SECOND RESTATED CERTIFICATE OF INCORPORATION OF COMPS.COM, INC., A DELAWARE CORPORATION COMPS.COM, INC., a corporation organized and existing under the laws of the State of Delaware, hereby certifies as follows: 1. The name of the corporation is COMPS.COM, INC. The original Certificate of Incorporation of the corporation was filed with the Secretary of State of the State of Delaware on September 1, 1994 and was amended pursuant to a Certificate of Ownership and Merger filed with the Secretary of State of the State of Delaware on October 4, 1994, and pursuant to a Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on October 13, 1994, and pursuant to a Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on February 4, 1998, and pursuant to a Certificate of Amendment of Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on November 5, 1998, and pursuant to a Certificate of Amendment of the Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on January 20, 1999. 2. Pursuant to Sections 242 and 245 of the General Corporation Law of the State of Delaware, this Second Restated Certificate of Incorporation was adopted by the corporation's Board of Directors and stockholders. 3. The text of the Certificate of Incorporation as heretofore amended or supplemented is hereby restated and further amended to read in its entirety as follows: ARTICLE I The name of this corporation is COMPS.COM, INC. ARTICLE II The address of this corporation's registered office in the State of Delaware is 1050 S. State Street, City of Dover, County of Kent. The name of its registered agent at such address is CorpAmerica, Inc. ARTICLE III The purpose of this corporation is to engage in any lawful act or activity for which a corporation may now or hereafter be organized under the Delaware General Corporation Law. ARTICLE IV (A) Classes of Stock. This corporation is authorized to issue two ---------------- classes of stock, denominated Common Stock and Preferred Stock. The Common Stock shall have a par value of $0.01 per share and the Preferred Stock shall have a par value of $0.01 per share. The total number of shares of Common Stock which the Corporation is authorized to issue is seventy-five million (75,000,000), and the total number of shares of Preferred Stock which the Corporation is authorized to issue is five million (5,000,000), which shares of Preferred Stock shall be undesignated as to series. (B) Issuance of Preferred Stock. The Preferred Stock may be issued --------------------------- from time to time in one or more series. The Board of Directors is hereby authorized, by filing one or more certificates pursuant to the Delaware General Corporation Law (each, a "Preferred Stock Designation"), to fix or alter from time to time the designations, powers, preferences and rights of each such series of Preferred Stock and the qualifications, limitations or restrictions thereof, including without limitation the dividend rights, dividend rate, conversion rights, voting rights, rights and terms of redemption (including sinking fund provisions), redemption price or prices, and the liquidation preferences of any wholly-unissued series of Preferred Stock, and to establish from time to time the number of shares constituting any such series and the designation thereof, or any of them; and to increase or decrease the number of shares of any series subsequent to the issuance of shares of that series, but not below the number of shares of such series then outstanding. In case the number of shares of any series shall be decreased in accordance with the foregoing sentence, the shares constituting such decrease shall resume the status that they had prior to the adoption of the resolution originally fixing the number of shares of such series. (C) Rights, Preferences, Privileges and Restrictions of Common Stock. ---------------------------------------------------------------- 1. Dividend Rights. Subject to the prior or equal rights --------------- of holders of all classes of stock at the time outstanding having prior or equal rights as to dividends, the holders of the Common Stock shall be entitled to receive, when and as declared by the Board of Directors, out of any assets of the corporation legally available therefor, such dividends as may be declared from time to time by the Board of Directors. 2. Redemption. The Common Stock is not redeemable upon ---------- demand of any holder thereof or upon demand of this corporation. 3. Voting Rights. The holder of each share of Common Stock ------------- shall have the right to one vote, and shall be entitled to notice of any stockholders' meeting in accordance with the Bylaws of this corporation, and shall be entitled to vote upon such matters and in such manner as may be provided by law. ARTICLE V (A) Exculpation. A director of the corporation shall not be ----------- personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law or (iv) for any transaction from which the director derived any improper personal benefit. If the Delaware General Corporation Law is hereafter amended to further reduce or to authorize, with the approval of the corporation's stockholders, further reductions in the liability of the corporation's directors for breach of fiduciary duty, then a director of the corporation shall not be 2 liable for any such breach to the fullest extent permitted by the Delaware General Corporation Law as so amended. (B) Indemnification. To the extent permitted by applicable law, this --------------- corporation is also authorized to provide indemnification of (and advancement of expenses to) such agents (and any other persons to which Delaware law permits this corporation to provide indemnification) through bylaw provisions, agreements with such agents or other persons, vote of stockholders or disinterested directors or otherwise, in excess of the indemnification and advancement otherwise permitted by Section 145 of the Delaware General Corporation Law, subject only to limits created by applicable Delaware law (statutory or non-statutory), with respect to actions for breach of duty to the corporation, its stockholders and others. (C) Effect of Repeal or Modification. Any repeal or modification of -------------------------------- any of the foregoing provisions of this Article V shall be prospective and shall not adversely affect any right or protection of a director, officer, agent or other person existing at the time of, or increase the liability of any director of the corporation with respect to any acts or omissions of such director occurring prior to, such repeal or modification. ARTICLE VI Elections of directors need not be by written ballot except and to the extent provided in the Bylaws of the corporation. At the next Annual Meeting of Stockholders, the Directors shall be classified into two classes, as nearly equal in number as possible as determined by the Board of Directors, with the term of office of the first class to expire at the second Annual Meeting of Stockholders and the term of office of the second class to expire at the third Annual Meeting of Stockholders. At each Annual Meeting of Stockholders following such initial classification and election, Directors elected to succeed those Directors whose terms expire shall be elected for a term of office to expire at the second succeeding Annual Meeting of Stockholders after their election. Additional directorships resulting from an increase in the number of Directors shall be apportioned among the classes as equally as possible as determined by the Board of Directors. ARTICLE VII No holder of shares of stock of the corporation shall have any preemptive or other right, except as such rights are expressly provided by contract, to purchase or subscribe for or receive any shares of any class, or series thereof, of stock of the corporation, whether now or hereafter authorized, or any warrants, options, bonds, debentures or other securities convertible into, exchangeable for or carrying any right to purchase any share of any class, or series thereof, of stock; but such additional shares of stock and such warrants, options, bonds, debentures or other securities convertible into, exchangeable for or carrying any right to purchase any shares of any class, or series thereof, of stock may be issued or disposed of by the Board of Directors to such persons, and on such terms and for such lawful consideration as in its discretion it shall deem advisable or as the corporation shall have by contract agreed. ARTICLE VIII The corporation is to have a perpetual existence. 3 ARTICLE IX The corporation reserves the right to repeal, alter, amend or rescind any provision contained in this Second Restated Certificate of Incorporation and/or any provision contained in any amendment to or restatement of this Second Restated Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred on stockholders herein are granted subject to this reservation. ARTICLE X The Board of Directors may from time to time make, amend, supplement or repeal the Bylaws by the requisite affirmative vote of Directors as set forth in the Bylaws; provided, however, that the stockholders may change or repeal any bylaw adopted by the Board of Directors by the requisite affirmative vote of stockholders as set forth in the Bylaws; and, provided further, that no amendment or supplement to the Bylaws adopted by the Board of Directors shall vary or conflict with any amendment or supplement thus adopted by the stockholders. ARTICLE XI No action shall be taken by the stockholders of the corporation except at an annual or special meeting of stockholders called in accordance with the Bylaws, and no action shall be taken by the stockholders by written consent. ARTICLE XII Advance notice of stockholder nominations for the election of directors and of business to be brought by stockholders before any meeting of the stockholders of the corporation shall be given in the manner provided in the Bylaws of the corporation. [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 4 IN WITNESS WHEREOF, this Second Restated Certificate of Incorporation has been signed under the seal of the corporation as of this ___ day of ____________, 1999. COMPS.COM, INC., a Delaware corporation By: ___________________________________ Christopher A. Crane, President and Chief Executive Officer ATTEST: _______________________________ Robert C. Beasley, Secretary [SIGNATURE PAGE TO SECOND RESTATED CERTIFICATE OF INCORPORATION OF COMPS.COM, INC.] EX-3.3 4 BYLAWS Exhibit 3.3 BY-LAWS OF COMPS INFOSYSTEMS, INC. TABLE OF CONTENTS -----------------
Page ---- ARTICLE I................................................................ 1 Section 1. Registered Office.......................................... 1 Section 2. Other Offices.............................................. 1 ARTICLE II............................................................... 1 Section 1. Place of Meetings.......................................... 1 Section 2. Annual Meetings of Stockholders............................ 1 Section 3. Quorum, Adjourned Meetings and Notice Thereof.............. 1 Section 4. Voting..................................................... 2 Section 5. Proxies.................................................... 2 Section 6. Special Meetings........................................... 2 Section 7. Notice of Stockholders Meetings............................ 2 Section 8. Maintenance and Inspection of Stockholder List............. 3 Section 9. Stockholder Action by Written Consent Without a Meeting.... 3 ARTICLE III.............................................................. 3 Section 1. The Number of Directors.................................... 3 Section 2. Vacancies.................................................. 3 Section 3. Powers..................................................... 4 Section 4. Place of Directors' Meetings............................... 4 Section 5. Regular Meetings........................................... 4 Section 6. Special Meetings........................................... 4 Section 7. Quorum..................................................... 4 Section 8. Action Without Meeting..................................... 5 Section 9. Telephonic Meetings........................................ 5 Section 10. Committees of Directors................................... 5 Section 11. Minutes of Committee Meetings............................. 5 Section 12. Compensation of Directors................................. 5 Section 13. Indemnification........................................... 6 ARTICLE IV............................................................... 8 Section 1. Officers................................................... 8 Section 2. Election of Officers....................................... 8 Section 3. Subordinate Officers....................................... 8 Section 4. Compensation of Officers................................... 8 Section 5. Term of Office; Removal and Vacancies...................... 8 Section 6. Chairman of the Board...................................... 9 Section 7. President.................................................. 9 Section 8. Vice Presidents............................................ 9 Section 9. Secretary and Assistant Secretary.......................... 9 Section 10. Assistant Secretaries..................................... 9 Section 11. Treasurer................................................. 10 Section 12. Assistant Treasurer....................................... 10
i ARTICLE V................................................................ 10 Section 1. Certificates............................................... 10 Section 2. Signatures on Certificates................................. 10 Section 3. Statement of Stock Rights, Preferences, Privileges......... 11 Section 4. Lost, Stolen or Destroyed Certificates..................... 11 Section 5. Transfers of Stock......................................... 11 Section 6. Fixing Record Date......................................... 11 Section 7. Registered Stockholders.................................... 12 ARTICLE VI............................................................... 12 Section 1. Dividends.................................................. 12 Section 2. Payment of Dividends; Director's Duties.................... 12 Section 3. Checks..................................................... 12 Section 4. Fiscal Year................................................ 12 Section 5. Seal....................................................... 12 Section 6. Notices.................................................... 13 Section 7. Waiver of Notice........................................... 13 Section 8. Annual Statement........................................... 13 ARTICLE VII.............................................................. 13 Section 1. Amendment by Directors or Stockholders..................... 13 ii BY-LAWS OF COMPS INFOSYSTEMS, INC. ARTICLE I OFFICES ------- Section 1. Registered Office. The registered office shall be in the --------- ----------------- City of Dover, County of Kent, State of Delaware. Section 2. Other Offices. The corporation may also have offices at --------- ------------- such other places both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the corporation may require. ARTICLE II MEETINGS OF STOCKHOLDERS ------------------------ Section 1. Place of Meetings. Meetings of stockholders shall be held --------- ----------------- at any place within or outside the State of Delaware designated by the Board of Directors. In the absence of any such designation, stockholders' meetings shall be held at the principal executive office of the corporation. Section 2. Annual Meetings of Stockholders. The annual meeting of --------- ------------------------------- stockholders shall be held each year on a date and a time designated by the Board of Directors. At each annual meeting directors shall be elected and any other proper business may be transacted. Section 3. Quorum; Adjourned Meetings and Notice Thereof. A majority --------- --------------------------------------------- of the stock issued and outstanding and entitled to vote at any meeting of stockholders, the holders of which are present in person or represented by proxy, shall constitute a quorum for the transaction of business except as otherwise provided by law, by the Certificate of Incorporation, or by these By- Laws. A quorum, once established, shall not be broken by the withdrawal of enough votes to leave less than a quorum and the votes present may continue to transact business until adjournment. If, however, such quorum shall not be present or represented at any meeting of the stockholders, a majority of the voting stock represented in person or by proxy may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. If the adjournment is for more than thirty days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote thereat. Section 4. Voting. When a quorum is present at any meeting, the vote --------- ------ of the holders of a majority of the stock having voting power present in person or represented by proxy shall decide any question brought before such meeting, unless the question is one upon which by express provision of the statutes, or the Certificate of Incorporation, or these By-Laws, a different vote is required in which case such express provision shall govern and control the decision of such question. Section 5. Proxies. At each meeting of the stockholders, each --------- ------- stockholder having the right to vote may vote in person or may authorize another person or persons to act for him by proxy appointed by an instrument in writing subscribed by such stockholder and bearing a date not more than three years prior to said meeting, unless said instrument provides for a longer period. All proxies must be filed with the Secretary of the corporation at the beginning of each meeting in order to be counted in any vote at the meeting. Each stockholder shall have one vote for each share of stock having voting power, registered in his name on the books of the corporation on the record date set by the Board of Directors as provided in Article V, Section 6 hereof. All elections shall be had and all questions decided by a plurality vote. Section 6. Special Meetings. Special meetings of the stockholders, --------- ---------------- for any purpose, or purposes, unless otherwise prescribed by statute or by the Certificate of Incorporation, may be called by the President and shall be called by the President or the Secretary at the request in writing of a majority of the Board of Directors, or at the request in writing of stockholders owning a majority in amount of the entire capital stock of the corporation issued and outstanding, and entitled to vote. Such request shall state the purpose or purposes of the proposed meeting. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice. Section 7. Notice of Stockholders Meetings. Whenever stockholders are --------- ------------------------------- required or permitted to take any action at a meeting, a written notice of the meeting shall be given which notice shall state the place, date and hour of the meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called. The written notice of any meeting shall be given to each stockholder entitled to vote at such meeting not less than ten nor more than sixty days before the date of the meeting. If mailed, notice is given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the corporation. Section 8. Maintenance and Inspection of Stockholder List. The --------- ---------------------------------------------- officer who has charge of the stock ledger of the corporation shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. 2 Section 9. Stockholder Action by Written Consent Without a Meeting. --------- ------------------------------------------------------- Unless otherwise provided in the Certificate of Incorporation, any action required to be taken at any annual or special meeting of stockholders of the corporation, or any action which may be taken at any annual or special meeting of such stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing. ARTICLE III DIRECTORS --------- Section 1. The Number of Directors. The number of directors which --------- ----------------------- shall constitute the whole Board shall be four (4). The directors need not be stockholders. The directors shall be elected at the annual meeting of the stockholders, except as provided in Section 2 of this Article, and each director elected shall hold office until his successor is elected and qualified; provided, however, that unless otherwise restricted by the Certificate of Incorporation or by law, any director or the entire Board of Directors may be removed, either with or without cause, from the Board of Directors at any meeting of stockholders by a majority of the stock represented and entitled to vote thereat. Section 2. Vacancies. Vacancies on the Board of Directors by reason --------- --------- of death, resignation, retirement, disqualification, removal from office, or otherwise, and newly created directorships resulting from any increase in the authorized number of directors may be filled by a majority of the directors then in office, although less than a quorum, or by a sole remaining director. The directors so chosen shall hold office until the next annual election of directors and until their successors are duly elected and shall qualify, unless sooner displaced. If there are no directors in office, then an election of directors may be held in the manner provided by statute. If, at the time of filling any vacancy or any newly created directorship, the directors then in office shall constitute less than a majority of the whole Board (as constituted immediately prior to any such increase), the Court of Chancery may, upon application of any stockholder or stockholders holding at least ten percent of the total number of the shares at the time outstanding having the right to vote for such directors, summarily order an election to be held to fill any such vacancies or newly created directorships, or to replace the directors chosen by the directors then in office. Section 3. Powers. The property and business of the corporation --------- ------ shall be managed by or under the direction of its Board of Directors. In addition to the powers and authorities by these By-Laws expressly conferred upon them, the Board may exercise all such powers of the corporation and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation or by these By-Laws directed or required to be exercised or done by the stockholders. 3 Section 4. Place of Directors' Meetings. The directors may hold their --------- ---------------------------- meetings and have one or more offices, and keep the books of the corporation outside of the State of Delaware. Section 5. Regular Meetings. Regular meetings of the Board of --------- ---------------- Directors may be held without notice at such time and place as shall from time to time be determined by the Board. Section 6. Special Meetings. Special meetings of the Board of --------- ---------------- Directors may be called by the President on forty-eight hours' notice to each director, either personally or by mail or by telegram; special meetings shall be called by the President or the Secretary in like manner and on like notice on the written request of two directors unless the Board consists of only one director; in which case special meetings shall be called by the President or Secretary in like manner or on like notice on the written request of the sole director. Section 7. Quorum. At all meetings of the Board of Directors a --------- ------ majority of the authorized number of directors shall be necessary and sufficient to constitute a quorum for the transaction of business, and the vote of a majority of the directors present at any meeting at which there is a quorum, shall be the act of the Board of Directors, except as may be otherwise specifically provided by statute, by the Certificate of Incorporation or by these By-Laws. If a quorum shall not be present at any meeting of the Board of Directors the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present. If only one director is authorized, such sole director shall constitute a quorum. Section 8. Action Without Meeting. Unless otherwise restricted by --------- ---------------------- the Certificate of Incorporation or these By-Laws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all members of the Board or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board or committee. Section 9. Telephonic Meetings. Unless otherwise restricted by the --------- ------------------- Certificate of Incorporation or these By-Laws, members of the Board of Directors, or any committee designated by the Board of Directors, may participate in a meeting of the Board of Directors, or any committee, by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at such meeting. Section 10. Committees of Directors. The Board of Directors may, by ---------- ----------------------- resolution passed by a majority of the whole Board, designate one or more committees, each such committee to consist of one or more of the directors of the corporation. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of 4 the Board of Directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers which may require it; but no such committee shall have the power or authority in reference to amending the Certificate of Incorporation, adopting an agreement of merger or consolidation, recommending to the stockholders the sale, lease or exchange of all or substantially all of the corporation's property and assets, recommending to the stockholders a dissolution of the corporation or a revocation of a dissolution, or amending the By-Laws of the corporation; and, unless the resolution or the Certificate of Incorporation expressly so provide, no such committee shall have the power or authority to declare a dividend or to authorize the issuance of stock. Section 11. Minutes of Committee Meetings. Each committee shall ---------- ----------------------------- keep regular minutes of its meetings and report the same to the Board of Directors when required. Section 12. Compensation of Directors. Unless otherwise restricted ---------- ------------------------- by the Certificate of Incorporation or these By-Laws, the Board of Directors shall have the authority to fix the compensation of directors. The directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary as director. No such payment shall preclude any director from serving the corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed like compensation for attending committee meetings. Section 13. Indemnification. The corporation shall indemnify any ---------- --------------- person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contenders or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful. (a) The corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys' fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best 5 interests of the corporation and except that no such indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable for negligence or misconduct in the performance of his duty to the corporation unless and only to the extent that the Court of Chancery of Delaware or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which such Court of Chancery or such other court shall deem proper. (b) To the extent that a director, officer, employee or agent of the corporation shall be successful on the merits or otherwise in defense of any action, suit or proceeding referred to in paragraphs (a) and (b), or in defense of any claim, issue or matter therein, he shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by him in connection therewith. (c) Any indemnification under paragraphs (a) and (b) (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances because he has met the applicable standard of conduct set forth in paragraphs (a) and (b). Such determination shall be made (1) by the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding, or (2) if such a quorum is not obtainable, or, even if obtainable a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, or (3) by the stockholders. (d) Expenses incurred in defending a civil or criminal action, suit or proceeding may be paid by the corporation in advance of the final disposition of such action, suit or proceeding as authorized by the Board of Directors in the manner provided in paragraph (d) upon receipt of an undertaking by or on behalf of the director, officer, employee or agent to repay such amount unless it shall ultimately be determined that he is entitled to be indemnified by the corporation as authorized in this Section 13. (e) The indemnification provided by this Section 13 shall not be deemed exclusive of any other rights to which those indemnified may be entitled under any by-law, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person. (f) The Board of Directors may authorize, by a vote of a majority of a quorum of the Board of Directors, the corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the corporation would have the power to indemnify him against such liability under the provisions of this Section 13. 6 (g) For the purposes of this Section 13, references to "the corporation" shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under the provisions of this Section with respect to the resulting or surviving corporation as he would have with respect to such constituent corporation if its separate existence had continued. (h) For purposes of this section, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to "serving at the request of the corporation" shall include service as a director, officer, employee or agent of the corporation which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner he reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of the corporation" as referred to in this section. ARTICLE IV OFFICERS -------- Section 1. Officers. The officers of this corporation shall be --------- -------- chosen by the Board of Directors and shall include a President, a Secretary, and a Treasurer. The corporation may also have at the discretion of the Board of Directors such other officers as are desired, including a Chairman of the Board, one or more Vice Presidents, one or more Assistant Secretaries and Assistant Treasurers, and such other officers as may be appointed in accordance with the provisions of Section 3 hereof. In the event there are two or more Vice Presidents, then one or more may be designated as Executive Vice President, Senior Vice President, or other similar or dissimilar title. At the time of the election of officers, the directors may by resolution determine the order of their rank. Any number of offices may be held by the same person, unless the Certificate of Incorporation or these By-Laws otherwise provide. Section 2. Election of Officers. The Board of Directors, at its --------- -------------------- first meeting after each annual meeting of stockholders, shall choose the officers of the corporation. Section 3. Subordinate Officers. The Board of Directors may appoint --------- -------------------- such other officers and agents as it shall deem necessary who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board. Section 4. Compensation of Officers. The salaries of all officers --------- ------------------------ and agents of the corporation shall be fixed by the Board of Directors. 7 Section 5. Term of Office; Removal and Vacancies. The officers of --------- ------------------------------------- the corporation shall hold office until their successors are chosen and qualify in their stead. Any officer elected or appointed by the Board of Directors may be removed at any time by the affirmative vote of a majority of the Board of Directors. If the office of any officer or officers becomes vacant for any reason, the vacancy shall be filled by the Board of Directors. Section 6. Chairman of the Board. The Chairman of the Board, if such --------- --------------------- an officer be elected, shall, if present, preside at all meetings of the Board of Directors and exercise and perform such other powers and duties as may be from time to time assigned to him by the Board of Directors or prescribed by these By-Laws. If there is no President, the Chairman of the Board shall in addition be the Chief Executive Officer of the corporation and shall have the powers and duties prescribed in Section 7 of this Article IV. Section 7. President. Subject to such supervisory powers, if any, as --------- --------- may be given by the Board of Directors to the Chairman of the Board, if there be such an officer, the President shall be the Chief Executive Officer of the corporation and shall, subject to the control of the Board of Directors, have general supervision, direction and control of the business and officers of the corporation. He shall preside at all meetings of the stockholders and, in the absence of the Chairman of the Board, or if there be none, at all meetings of the Board of Directors. He shall be an ex-officio member of all committees and shall have the general powers and duties of management usually vested in the office of President and Chief Executive Officer of corporations, and shall have such other powers and duties as may be prescribed by the Board of Directors or these By-Laws. Section 8. Vice Presidents. In the absence or disability of the --------- --------------- President, the Vice Presidents in order of their rank as fixed by the Board of Directors, or if not ranked, the Vice President designated by the Board of Directors, shall perform all the duties of the President, and when so acting shall have all the powers of and be subject to all the restrictions upon the President. The Vice Presidents shall have such other duties as from time to time may be prescribed for them, respectively, by the Board of Directors. Section 9. Secretary and Assistant Secretary. The Secretary shall --------- --------------------------------- attend all sessions of the Board of Directors and all meetings of the stockholders and record all votes and the minutes of all proceedings in a book to be kept for that purpose; and shall perform like duties for the standing committees when required by the Board of Directors. He shall give, or cause to be given, notice of all meetings of the stockholders and of the Board of Directors, and shall perform such other duties as may be prescribed by the Board of Directors or these By-Laws. He shall keep in safe custody the seal of the corporation, and when authorized by the Board, affix the same to any instrument requiring it, and when so affixed it shall be attested by his signature or by the signature of an Assistant Secretary. The Board of Directors may give general authority to any other officer to affix the seal of the corporation and to attest the affixing by his signature. Section 10. Assistant Secretaries. The Assistant Secretary, or if ---------- --------------------- there be more than one, the Assistant Secretaries in the order determined by the Board of Directors, or if there be no such determination, the Assistant Secretary designated by the Board of Directors, shall, in the absence or disability of the Secretary, perform the duties and exercise the powers of the 8 Secretary and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe. Section 11. Treasurer. The Treasurer shall have the custody of the ---------- --------- corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the corporation and shall deposit all moneys, and other valuable effects in the name and to the credit of the corporation, in such depositories as may be designated by the Board of Directors. He shall disburse the funds of the corporation as may be ordered by the Board of Directors, taking proper vouchers for such disbursements, and shall render to the Board of Directors, at its regular meetings, or when the Board of Directors so requires, an account of all his transactions as Treasurer and of the financial condition of the corporation. If required by the Board of Directors, he shall give the corporation a bond, in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors, for the faithful performance of the duties of his office and for the restoration to the corporation, in case of his death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in his possession or under his control belonging to the corporation. Section 12. Assistant Treasurer. The Assistant Treasurer, or if ---------- ------------------- there shall be more than one, the Assistant Treasurers in the order determined by the Board of Directors, or if there be no such determination, the Assistant Treasurer designated by the Board of Directors, shall, in the absence or disability of the Treasurer, perform the duties and exercise the powers of the Treasurer and shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe. ARTICLE V CERTIFICATES OF STOCK --------------------- Section 1. Certificates. Every holder of stock of the corporation --------- ------------ shall be entitled to have a certificate signed by, or in the name of the corporation by, the Chairman or Vice Chairman of the Board of Directors, or the President or a Vice President, and by the Secretary or an Assistant Secretary, or the Treasurer or an Assistant Treasurer of the corporation, certifying the number of shares represented by the certificate owned by such stockholder in the corporation. Section 2. Signatures on Certificates. Any or all of the signatures --------- -------------------------- on the certificate may be a facsimile. In case any officer, transfer agent, or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if he were such officer, transfer agent, or registrar at the date of issue. Section 3. Statement of Stock Rights, Preferences, Privileges. --------- -------------------------------------------------- If the corporation shall be authorized to issue more than one class of stock or more than one series of any class, the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualification, limitations or restrictions of such preferences and/or rights shall be set forth in full or summarized on the face or back of the certificate which the corporation shall issue to represent such class or series of stock, provided that, except as otherwise provided in section 202 of the General Corporation Law of Delaware, 9 in lieu of the foregoing requirements, there may be set forth on the face or back of the certificate which the corporation shall issue to represent such class or series of stock, a statement that the corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights. Section 4. Lost, Stolen or Destroyed Certificates. The Board of --------- -------------------------------------- Directors may direct a new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen or destroyed. When authorizing such issue of a new certificate or certificates, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or certificates, or his legal representative, to advertise the same in such manner as it shall require and/or to give the corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the corporation with respect to the certificate alleged to have been lost, stolen or destroyed. Section 5. Transfers of Stock. Upon surrender to the corporation, or --------- ------------------ the transfer agent of the corporation, of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignation or authority to transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books. Section 6. Fixing Record Date. In order that the corporation may --------- ------------------ determine the stockholders entitled to notice of or to vote at any meeting of the stockholders, or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix a record date which shall not be more than sixty nor less than ten days before the date of such meeting, nor more than sixty days prior to any other action. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting. Section 7. Registered Stockholders. The corporation shall be --------- ----------------------- entitled to treat the holder of record of any share or shares of stock as the holder in fact thereof and accordingly shall not be bound to recognize any equitable or other claim or interest in such share on the part of any other person, whether or not it shall have express or other notice thereof, save as expressly provided by the laws of the State of Delaware. ARTICLE VI GENERAL PROVISIONS ------------------ Section 1. Dividends. Dividends upon the capital stock of the --------- --------- corporation, subject to the provisions of the Certificate of Incorporation, if any, may be declared by the Board 10 of Directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, in property, or in shares of the capital stock, subject to the provisions of the Certificate of Incorporation. Section 2. Payment of Dividends; Director's Duties. Before payment --------- --------------------------------------- of any dividend there may be set aside out of any funds of the corporation available for dividends such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve fund to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the corporation, or for such other purpose as the directors shall think conducive to the interests of the corporation, and the directors may abolish any such reserve. Section 3. Checks. All checks or demands for money and notes of the --------- ------ corporation shall be signed by such officer or officers as the Board of Directors may from time to time designate. Section 4. Fiscal Year. The fiscal year of the corporation shall be --------- ----------- fixed by resolution of the Board of Directors. Section 5. Seal. The corporate seal shall have inscribed thereon the --------- ---- name of the corporation, the year of its organization and the words "Corporate Seal, Delaware". Said seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise. Section 6. Notices. Whenever, under the provisions of the statutes --------- ------- or of the Certificate of Incorporation or of these By-Laws, notice is required to be given to any director or stockholder, it shall not be construed to mean personal notice, but such notice may be given in writing, by mail, addressed to such director or stockholder, at his address as it appears on the records of the corporation, with postage thereon prepaid, and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail. Notice to directors may also be given by telegram. Section 7. Waiver of Notice. Whenever any notice is required to be --------- ---------------- given under the provisions of the statutes or of the Certificate of Incorporation or of these By-Laws, a waiver thereof in writing, signed by the person or persons entitled to said notice, whether before or after the time stated therein, shall be deemed to be equivalent. Section 8. Annual Statement. The Board of Directors shall present at --------- ---------------- each annual meeting, and at any special meeting of the stockholders when called for by vote of the stockholders, a full and clear statement of the business and condition of the corporation. ARTICLE VII AMENDMENTS ---------- Section 1. Amendment by Directors or Stockholders. These By-Laws may --------- -------------------------------------- be altered, amended or repealed or new By-Laws may be adopted by the stockholders or by the Board of Directors, when such power is conferred upon the Board of Directors by the Certificate 11 of Incorporation, at any regular meeting of the stockholders or of the Board of Directors or at any special meeting of the stockholders or of the Board of Directors if notice of such alteration, amendment, repeal or adoption of new By- Laws be contained in the notice of such special meeting. If the power to adopt, amend or repeal By-Laws is conferred upon the Board of Directors by the Certificate of Incorporation it shall not divest or limit the power of the stockholders to adopt, amend or repeal By-Laws. 12 EX-3.4 5 FORM OF RESTATED BYLAWS Exhibit 3.4 FORM OF RESTATED BYLAWS OF COMPS.COM, INC. ARTICLE I OFFICES ------- Section 1. Registered Office. The registered office shall be in the ----------------- City of Dover, County of Kent, State of Delaware. Section 2. Other Offices. The corporation may also have offices at ------------- such other places both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the corporation may require. ARTICLE II MEETINGS OF STOCKHOLDERS ------------------------ Section 1. Place of Meetings. All meetings of the stockholders for ----------------- the election of Directors shall be held in the City of San Diego, State of California, at such place as may be fixed from time to time by the Board of Directors, or at such other place either within or without the State of California as shall be designated from time to time by the Board of Directors and stated in the notice of the meeting. Meetings of stockholders for any other purpose may be held at such time and place, within or without the State of California, as shall be stated in the notice of the meeting or in a duly executed waiver of notice thereof. Section 2. Annual Meeting. -------------- (a) The annual meeting of the stockholders of the corporation, for the purpose of election of Directors and for such other business as may lawfully come before it, shall be held on such date and at such time as may be designated from time to time by the Board of Directors. (b) At an annual meeting of the stockholders, only such business shall be conducted as shall have been properly brought before the meeting. To be properly brought before an annual meeting, business must be: (A) specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors, (B) otherwise properly brought before the meeting by or at the direction of the Board of Directors, or (C) otherwise properly brought before the meeting by a stockholder. For business to be properly brought before an annual meeting by a stockholder, the stockholder must have given timely notice thereof in writing to the Secretary of the corporation. To be timely, a stockholder's notice must be delivered to or mailed and received at the principal executive offices of the corporation no later than the date specified in the corporation's proxy statement released to stockholders in connection with the previous year's annual meeting of stockholders, which date shall be not less than one hundred twenty (120) calendar days in advance of the date of such proxy statement; provided, however, that in the event that no annual meeting was held in the previous year or the date of the annual meeting has been changed by more than thirty (30) days from the date contemplated at the time of the previous year's proxy statement, notice by the stockholder to be timely must be so received a reasonable time before the solicitation is made. A stockholder's notice to the Secretary shall set forth as to each matter the stockholder proposes to bring before the annual meeting: (i) a brief description of the business desired to be brought before the annual meeting and the reasons for conducting such business at the annual meeting, (ii) the name and address, as they appear on the corporation's books, of the stockholder proposing such business, (iii) the class and number of shares of the corporation which are beneficially owned by the stockholder, (iv) any material interest of the stockholder in such business and (v) any other information that is required to be provided by the stockholder pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the "1934 Act"), in such stockholder's capacity as a proponent to a stockholder proposal. In addition to the foregoing, in order to include information with respect to a stockholder proposal in the proxy statement and form of proxy for a stockholder's meeting, stockholders must provide notice as required by the regulations promulgated under the 1934 Act to the extent such regulations require notice that is different from the notice required above. Notwithstanding anything in these Bylaws to the contrary, no business shall be conducted at any annual meeting except in accordance with the procedures set forth in this paragraph (b) of this Section 2. The chairman of the annual meeting shall, if the facts warrant, determine and declare at the meeting that business was not properly brought before the meeting and in accordance with the provisions of this paragraph (b), and, if he or she should so determine, the chairman shall so declare at the meeting that any such business not properly brought before the meeting shall not be transacted. (c) Only persons who are nominated in accordance with the procedures set forth in this paragraph (c) shall be eligible for election as Directors. Nominations of persons for election to the Board of Directors of the corporation may be made at a meeting of stockholders by or at the direction of the Board of Directors or by any stockholder of the corporation entitled to vote in the election of Directors at the meeting who complies with the notice procedures set forth in this paragraph (c). Such nominations, other than those made by or at the direction of the Board of Directors, shall be made pursuant to timely notice in writing to the Secretary of the corporation in accordance with the provisions of paragraph (b) of this Section 2. Timely notice shall also be given of any stockholder's intention to cumulate votes in the election of Directors at a meeting if cumulative voting is available. Such stockholder's notice shall set forth (i) as to each person, if any, whom the stockholder proposes to nominate for election or re-election as a Director: (A) the name, age, business address and residence address of such person, (B) the principal occupation or employment of such person, (C) the class and number of shares of the corporation that are beneficially owned by such person, (D) a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nominations are to be made by the stockholder, and (E) any other information relating to such person that is required to be disclosed in solicitations of proxies for election of Directors, or is otherwise required, in each case pursuant to Regulation 14A under the 1934 Act (including without limitation such person's written consent to being named in the proxy statement, if any, as a nominee and to serving as a Director if elected); and (ii) as to such stockholder giving notice, the information required to be provided pursuant to subitems (ii), (iii) and (iv) of paragraph (b) of this Section 2 and, if -2- cumulative voting is available to such stockholder, whether such stockholder intends to request cumulative voting in the election of Directors at the meeting. At the request of the Board of Directors, any person nominated by a stockholder for election as a Director shall furnish to the Secretary of the corporation that information required to be set forth in the stockholder's notice of nomination which pertains to the nominee. No person shall be eligible for election as a Director of the corporation unless nominated in accordance with the procedures set forth in this paragraph (c). The chairman of the meeting shall, if the facts warrant, determine and declare at the meeting that a nomination was not made in accordance with the procedures prescribed by these Bylaws, and if the chairman should so determine, he or she shall so declare at the meeting, and the defective nomination shall be disregarded. Section 3. Notice of Annual Meeting. Written notice of the annual ------------------------ meeting stating the place, date and hour of the meeting shall be given to each stockholder entitled to vote at such meeting not less than ten (10) nor more than sixty (60) days before the date of the meeting. Section 4. Voting List. The officer who has charge of the stock ----------- ledger of the corporation shall prepare and make, or have prepared and made, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten (10) days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. Section 5. Special Meetings. Special meetings of the stockholders, ---------------- for any purpose or purposes, unless otherwise prescribed by statute or by the Certificate of Incorporation, as amended from time to time, may only be called as provided in this Section 5 by the President, Chief Executive Officer or Chairman of the Board and shall be called by the President or Secretary at the request in writing of a majority of the Board of Directors. Such request shall state the purpose or purposes of the proposed meeting. The place, date and time of any special meeting shall be determined by the Board of Directors. Such determination shall include the record date for determining the stockholders having the right of and to vote at such meeting. Section 6. Notice of Special Meeting. Written notice of a special ------------------------- meeting stating the place, date and hour of the meeting and the purpose or purposes for which the meeting is called shall be given not less than ten (10) nor more than sixty (60) days before the date of the meeting, to each stockholder entitled to vote at such meeting. Section 7. Action at Special Meeting. Business transacted at any ------------------------- special meeting of stockholders shall be limited to the purposes stated in the notice. -3- Section 8. Quorum and Adjournments. ----------------------- (a) The holders of a majority of the stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business except as otherwise provided by statute or by the Certificate of Incorporation, as amended. If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote thereat, present in person or represented by proxy, shall have the power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. (b) When a quorum is present at any meeting, the vote of the holders of a majority of the stock having voting power present in person or represented by proxy shall decide any question brought before such meeting, unless the question is one upon which by express provision of statute or of the Certificate of Incorporation, as amended, a different vote is required, in which case such express provision shall govern and control the decision of such question. Section 9. Voting Rights. Unless otherwise provided in the ------------- Certificate of Incorporation, as amended, each stockholder shall at every meeting of the stockholders be entitled to one (1) vote in person or by proxy for each share of the capital stock having voting power held by such stockholder, but no proxy shall be voted on after three (3) years from its date, unless the proxy provides for a longer period. Section 10. Action Without Meeting. No action shall be taken by the ---------------------- stockholders of the corporation except at an annual or special meeting of stockholders called in accordance with these Bylaws, and no action shall be taken by the stockholders by written consent. ARTICLE III DIRECTORS --------- Section 1. Classes, Number, Term of Office and Qualification. At ------------------------------------------------- the next annual meeting of stockholders following the adoption of these Bylaws, the Directors shall be classified into two classes, as nearly equal in number as possible as determined by the Board of Directors, with the term of office of the first class to expire at the second annual meeting of stockholders following the adoption of these Bylaws and the term of office of the second class to expire at the third annual meeting of stockholders following the adoption of these Bylaws. At each annual meeting of stockholders following such initial classification and election, Directors elected to succeed those Directors whose terms expire shall be elected for a term of office to expire at the second succeeding annual meeting of stockholders after their election. Additional directorships resulting from an increase in the number of Directors shall be apportioned among the classes as equally as possible as determined by the Board of Directors. The number of directors that shall constitute the whole board shall not be less than four (4) nor more than seven (7). The number of -4- Directors which shall constitute the whole Board shall be fixed by resolution of the Board of Directors, with the number initially fixed at five (5). The number of Directors shall be determined by resolution of sixty-six and two-thirds percent (66-2/3%) of the Directors then in office or by sixty-six and two-thirds percent (66-2/3%) of the stockholders at the annual meeting of the stockholders, and each Director elected shall hold office until his or her successor is elected and qualified. Directors need not be stockholders. Section 2. Vacancies. Vacancies may be filled only by a two-thirds --------- majority of the Directors then in office or by a sole remaining Director. Each Director so chosen shall hold office until a successor is duly elected and shall qualify or until his or her earlier death, resignation or removal. If there are no Directors in office, then an election of Directors may be held in the manner provided by statute; provided, however, that each Director shall be elected by an affirmative vote of at least two-thirds of the stockholders. If, at the time of filling any vacancy, the Directors then in office shall constitute less than a majority of the whole Board (as constituted immediately prior to any such increase), the Court of Chancery may, upon application of any stockholder or stockholders holding at least ten percent of the total number of the shares at the time outstanding having the right to vote for such Directors, summarily order an election to be held to fill any such vacancies, or to replace the Directors chosen by the Directors then in office. Section 3. Powers. The business of the corporation shall be managed ------ by or under the direction of its Board of Directors which may exercise all such powers of the corporation and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation, as amended, or by these Bylaws directed or required to be exercised or done by the stockholders. Section 4. Regular and Special Meetings. The Board of Directors of ---------------------------- the corporation may hold meetings, both regular and special, either within or without the State of California. Section 5. Annual Meeting. The annual meeting of the Board of -------------- Directors shall be held without notice other than this Bylaw immediately after, and at the same place as, the annual meeting of stockholders. In the event the annual meeting of the Board of Directors shall not be held immediately after, and at the same place as, the annual meeting of stockholders, the meeting may be held at such time and place as shall be specified in a notice given as hereinafter provided for special meetings of the Board of Directors. Section 6. Notice of Regular Meetings. Regular meetings of the Board -------------------------- of Directors may be held without notice at such time and at such place as shall from time to time be determined by the Board. Section 7. Notice of Special Meetings. Special meetings of the Board -------------------------- may be called by the Chief Executive Officer or President on no less than forty- eight (48) hours notice to each Director either personally, or by telephone, mail, telegram or facsimile; special meetings shall be called by the Chief Executive Officer, President or Secretary in like manner and on like notice on the written request of two Directors unless the Board consists of only one Director, in which case special meetings shall be called by the Chief Executive Officer, President or Secretary in like manner and on like notice on the written request of the sole Director. A written waiver of notice, -5- signed by the person entitled thereto, whether before or after the time of the meeting stated therein, shall be deemed equivalent to notice. Section 8. Quorum. At all meetings of the Board a majority of the ------ Directors shall constitute a quorum for the transaction of business and the act of a majority of the Directors present at any meeting at which there is a quorum shall be the act of the Board of Directors, except as may be otherwise specifically provided by these Bylaws, by statute or by the Certificate of Incorporation, as amended. If a quorum shall not be present at any meeting of the Board of Directors, the Directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present. Section 9. Action Without Meeting. Unless otherwise restricted by ---------------------- the Certificate of Incorporation, as amended, or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all members of the Board or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board or committee. Section 10. Meetings by Telephone Conference Calls. Unless otherwise -------------------------------------- restricted by the Certificate of Incorporation, as amended, or these Bylaws, members of the Board of Directors, or any committee designated by the Board of Directors, may participate in a meeting of the Board of Directors, or any committee, by means of conference telephone, video conference or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting. Section 11. Committees. The Board of Directors may, by resolution ---------- passed by a majority of the whole Board, designate one or more committees, each committee to consist of one or more of the Directors of the corporation. The Board may designate one or more Directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence of disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he, she or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers which may require it; but no such committee shall have the power or authority in reference to amending the Certificate of Incorporation, as amended, adopting an agreement of merger or consolidation, recommending to the stockholders the sale, lease or exchange of all or substantially all of the corporation's property and assets, recommending to the stockholders a dissolution of the corporation or a revocation of a dissolution, or amending the Bylaws of the corporation; and, unless the resolution or the Certificate of Incorporation, as amended, expressly so provide, no such committee shall have the power or authority to declare a dividend or to authorize the issuance of stock. Such committee or -6- committees shall have such name or names as may be determined from time to time by resolution adopted by the Board of Directors. Each committee shall keep regular minutes of its meetings and report the same to the Board of Directors when required. Section 12. Fees and Compensation. Unless otherwise restricted by --------------------- the Certificate of Incorporation, as amended, or these Bylaws, the Board of Directors shall have the authority to fix the compensation of Directors. The Directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary as Director. No such payment shall preclude any Director from serving the corporation in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed like compensation for attending committee meetings. Section 13. Removal. Subject to any limitations imposed by law or ------- the Certificate of Incorporation, as amended, the Board of Directors, or any individual Director, may be removed from office at any time only with cause by the affirmative vote of the holders of at least a majority of shares entitled to vote at an election of Directors. ARTICLE IV NOTICES ------- Section 1. Notice. Whenever, under the provisions of statute or of ------ the Certificate of Incorporation, as amended, or of these Bylaws, notice is required to be given to any Director or stockholder, it shall not be construed to mean personal notice, but such notice may be given in writing, by mail, addressed to such Director or stockholder, at his, her or its address as it appears on the records of the corporation, with postage thereon prepaid, and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail. Notice to Directors may also be given personally, by telephone, including a voice messaging system or other system or technology designed to record and communicate messages, telegram, facsimile electronic mail or other electronic means. Section 2. Waiver of Notice. Whenever any notice is required to be ---------------- given under the provisions of statute or of the Certificate of Incorporation, as amended, or of these Bylaws, a waiver thereof in writing, signed by the person or persons entitled to said notice, whether before or after the time stated therein, shall be deemed equivalent thereto. ARTICLE V OFFICERS -------- Section 1. Enumeration. The officers of the corporation shall be ----------- chosen by the Board of Directors and shall include a Chief Executive Officer, a Chief Financial Officer and a Secretary. The Board of Directors may elect from among its members a Chairman of the Board and a Vice Chairman of the Board. The Board of Directors may also choose a President, one or more Vice Presidents and one or more Assistant Secretaries. Any number of offices may be held by the same person, unless the Certificate of Incorporation, as amended, or these Bylaws otherwise provide. -7- The compensation of all officers and agents of the corporation shall be fixed by the Board of Directors, and no officer shall be prevented from receiving such compensation by virtue of such officer also being a Director of the corporation. Section 2. Election or Appointment. The Board of Directors at its ----------------------- first meeting after each annual meeting of stockholders shall choose a Chief Executive Officer, a Chief Financial Officer and a Secretary and may choose a President, one or more Vice Presidents and one or more Assistant Secretaries. The Board of Directors may appoint such other officers and agents as it shall deem necessary who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board. Section 3. Tenure, Removal and Vacancies. The officers of the ----------------------------- corporation shall hold office until their successors are chosen and qualified. Any officer elected or appointed by the Board of Directors may be removed at any time by the affirmative vote of a majority of the Board of Directors. Any vacancy occurring in any office of the corporation shall be filled by the Board of Directors. Section 4. Chairman of the Board. The Chairman of the Board, if any, --------------------- shall preside at all meetings of the Board of Directors and of the stockholders at which he or she shall be present. The Chairman of the Board shall have and may exercise such powers as are, from time to time, assigned to him or her by the Board and as may be provided by law. Section 5. Vice Chairman of the Board. In the absence of the -------------------------- Chairman of the Board, the Vice Chairman of the Board, if any, shall preside at all meetings of the Board of Directors and of the stockholders at which he or she shall be present. The Vice Chairman of the Board shall have and may exercise such powers as are, from time to time, assigned to him or her by the Board and as may be provided by law. Section 6. Chief Executive Officer. The Chief Executive Officer of ----------------------- the corporation shall, subject to the control of the Board of Directors, have general supervision, direction and control of the business and the officers of the corporation. In the absence or nonexistence of a Chairman of the Board and a Vice Chairman of the Board, the Chief Executive Officer shall preside at all meetings of the Board of Directors and of the stockholders. The Chief Executive Officer shall have the general powers and duties of management usually vested in the Chief Executive Officer of a corporation, including general supervision, direction and control of the business and supervision of other officers of the corporation, and shall have such other powers and duties as may be prescribed by the Board of Directors or these Bylaws. The Chief Executive Officer shall, without limitation, have the authority to execute bonds, mortgages and other contracts requiring a seal, under the seal of the corporation, except where required or permitted by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly delegated by the Board of Directors to some other officer or agent of the corporation. Section 7. President. Subject to such supervisory powers as may be --------- given by these Bylaws or the Board of Directors to the Chairman of the Board or the Chief Executive Officer, if -8- there be such officers, the President shall have general supervision, direction and control of the business and supervision of other officers of the corporation, and shall have such other powers and duties as may be prescribed by the Board of Directors or these Bylaws. In the event a Chief Executive Officer shall not be appointed, the President shall have the duties of such office. Section 8. Vice Presidents. The Vice President, or if there shall be --------------- more than one, the Vice Presidents in the order determined by the Board of Directors, shall, in the absence or disability of the President, act with all of the powers and be subject to all the restrictions of the President. The Vice Presidents shall also perform such other duties and have such other powers as the Board of Directors, the Chief Executive Officer, the President or these Bylaws may, from time to time, prescribe. Section 9. Secretary. The Secretary shall attend all meetings of the --------- Board of Directors, all meetings of the committees thereof and all meetings of the stockholders and record all the proceedings of the meetings in a book or books to be kept for that purpose. Under the Chief Executive Officer's or President's supervision, the Secretary shall give, or cause to be given, all notices required to be given by these Bylaws or by law; shall have such powers and perform such duties as the Board of Directors, the Chief Executive Officer, the President or these Bylaws may, from time to time, prescribe; and shall have custody of the seal of the corporation. The Secretary, or an Assistant Secretary, shall have authority to affix the seal of the corporation to any instrument requiring it and when so affixed, it may be attested by his or her signature or by the signature of such Assistant Secretary. The Board of Directors may give general authority to any other officer to affix the seal of the corporation and to attest the affixing by his or her signature. Section 10. Assistant Secretary. The Assistant Secretary, if any, or ------------------- if there be more than one, the Assistant Secretaries in the order determined by the Board of Directors, shall, in the absence, disability or refusal to act of the Secretary, perform the duties and exercise the powers of the Secretary and shall perform such other duties and have such other powers as the Board of Directors, the Chief Executive Officer, the President, the Secretary or these Bylaws may, from time to time, prescribe. Section 11. Chief Financial Officer. The Chief Financial Officer ----------------------- shall act as Treasurer and shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the corporation in such depositories as may be designated by the Board of Directors. The Chief Financial Officer may alternatively be designated by the title "Treasurer." The Chief Financial Officer shall disburse the funds of the corporation as may be ordered by the Board of Directors, taking proper vouchers for such disbursements, and shall render to the Chief Executive Officer or, if there be no Chief Executive Officer, the President and the Board of Directors, at its regular meetings, or when the Board of Directors so requires, an account of all his or her transactions as Chief Financial Officer and of the financial condition of the corporation. -9- If required by the Board of Directors, the Chief Financial Officer shall give the corporation a bond (which shall be renewed every six years) in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors for the faithful performance of the duties of his or her office and for the restoration to the corporation, in case of his or her death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in the Chief Financial Officer's possession or under his or her control belonging to the corporation. Section 12. Other Officers, Assistant Officers and Agents. Officers, --------------------------------------------- assistant officers and agents, if any, other than those whose duties are provided for in these Bylaws, shall have such authority and perform such duties as may from time to time be prescribed by the Board of Directors, the Chief Executive Officer or the President. Section 13. Absence or Disability of Officers. In the case of the --------------------------------- absence or disability of any officer of the corporation and of any person hereby authorized to act in such officer's place during such officer's absence or disability, the Board of Directors may delegate the powers and duties of such officer to any officer or to any Director, or to any other person who it may select. ARTICLE VI CERTIFICATES OF STOCK --------------------- Section 1. Certificates of Stock. Every holder of stock in the --------------------- corporation shall be entitled to have a certificate, signed by, or in the name of the corporation by, the Chairman or Vice Chairman of the Board of Directors, or the Chief Executive Officer or the President or a Vice President and the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary of the corporation, certifying the number of shares owned by him in the corporation. Certificates may be issued for partly paid shares and in such case upon the face or back of the certificates issued to represent any such partly paid shares, the total amount of the consideration to be paid therefor, and the amount paid thereon shall be specified. If the corporation shall be authorized to issue more than one class of stock or more than one series of any class, the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights shall be set forth in full or summarized on the face or back of the certificate which the corporation shall issue to represent such class or series of stock, provided that, except as otherwise provided in Section 202 of the General Corporation Law of Delaware, in lieu of the foregoing requirements, there may be set forth on the face or back of the certificate which the corporation shall issue to represent such class or series of stock, a statement that the corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights. Section 2. Execution of Certificates. Any or all of the signatures ------------------------- on the certificate may be facsimile. In case any officer, transfer agent or registrar who has signed or whose -10- facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue. Section 3. Lost Certificates. The Board of Directors may direct a ----------------- new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen or destroyed. When authorizing such issue of a new certificate or certificates, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or certificates, or the owner's legal representative, to advertise the same in such manner as it shall require and/or to give the corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the corporation with respect to the certificate alleged to have been lost, stolen or destroyed. Section 4. Transfer of Stock. Upon surrender to the corporation or ----------------- the transfer agent of the corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignation or authority to transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books. Section 5. Fixing Record Date. In order that the corporation may ------------------ determine the stockholders entitled to notice of or to vote at any meeting of stockholder or any adjournment thereof, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix, in advance, a record date, which shall not be more than sixty (60) nor less than ten (10) days before the date of such meeting, nor more than sixty (60) days prior to any other action. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting. Section 6. Registered Stockholders. The corporation shall be ----------------------- entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and to hold liable for calls and assessments a person registered on its books as the owner of shares and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of Delaware. ARTICLE VII INDEMNIFICATION --------------- Section 1. Indemnification of Directors and Executive Officers. --------------------------------------------------- The corporation shall indemnify its Directors and executive officers to the fullest extent not prohibited by the Delaware General Corporation Law; provided, however, that the corporation may limit the extent -11- of such indemnification by individual contracts with its Directors and executive officers; and, provided, further, that the corporation shall not be required to indemnify any Director or executive officer in connection with any proceeding (or part thereof) initiated by such person or any proceeding by such person against the corporation or its Directors, officers, employees or other agents unless (i) such indemnification is expressly required to be made by law, (ii) the proceeding was authorized by the Board of Directors of the corporation and (iii) such indemnification is provided by the corporation, in its sole discretion, pursuant to the powers vested in the corporation under the Delaware General Corporation Law. Section 2. Indemnification of Other Officers, Employees and Other ------------------------------------------------------ Agents. The corporation shall have power to indemnify its other officers, - ------ employees and other agents as set forth in the Delaware General Corporation Law. Section 3. Good Faith. ---------- (a) For purposes of any determination under this Bylaw, a Director or executive officer shall be deemed to have acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, to have had no reasonable cause to believe that his or her conduct was unlawful, if his or her action is based on information, opinions, reports and statements, including financial statements and other financial data, in each case prepared or presented by: (1) one or more officers or employees of the corporation whom the Director or executive officer believed to be reliable and competent in the matters presented; (2) counsel, independent accountants or other persons as to matters which the Director or executive officer believed to be within such person's professional competence; and (3) with respect to a Director, a committee of the Board upon which such Director does not serve, as to matters within such committee's designated authority, which committee the Director believes to merit confidence; so long as, in each case, the Director or executive officer acts without knowledge that would cause such reliance to be unwarranted. (b) The termination of any proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent shall not, of itself, create a presumption that the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal proceeding, that such person had reasonable cause to believe that his or her consent was unlawful. (c) The provisions of this Section 3 shall not be deemed to be exclusive or to limit in any way the circumstances in which a person may be deemed to have met the applicable standard of conduct set forth by the Delaware General Corporation Law. Section 4. Expenses. The corporation shall advance, prior to the -------- final disposition of any proceeding, promptly following request therefor, all expenses incurred by any Director or -12- executive officer in connection with such proceeding upon receipt of an undertaking by or on behalf of such person to repay said amounts if it should be determined ultimately that such person is not entitled to be indemnified under this Bylaw or otherwise. Notwithstanding the foregoing, unless otherwise determined pursuant to Section 4 of this Bylaw, no advance shall be made by the corporation if a determination is reasonably and promptly made (i) by the Board of Directors by a majority vote of a quorum consisting of Directors who were not parties to the proceeding or (ii) if such quorum is not obtainable, or, even if obtainable, a quorum of disinterested Directors so directs, by independent legal counsel in a written opinion, that the facts known to the decision-making party at the time such determination is made demonstrate clearly and convincingly that such person acted in bad faith or in a manner that such person did not believe to be in or not opposed to the best interests of the corporation. Section 5. Enforcement. Without the necessity of entering into an ----------- express contract, all rights to indemnification and advances to Directors and executive officers under this Bylaw shall be deemed to be contractual rights and be effective to the same extent and as if provided for in a contract between the corporation and the Director or executive officer. Any right to indemnification or advances granted by this Bylaw to a Director or executive officer shall be enforceable by or on behalf of the person holding such right in any court of competent jurisdiction if (i) the claim for indemnification or advances is denied, in whole or in part or (ii) no disposition of such claim is made within ninety (90) days of request therefor. The claimant in such enforcement action, if successful in whole or in part, shall be entitled to be paid also the expense of prosecuting such claim. The corporation shall be entitled to raise as a defense to any such action that the claimant has not met the standards of conduct that make it permissible under the Delaware General Corporation Law for the corporation to indemnify the claimant for the amount claimed. Neither the failure of the corporation (including its Board of Directors, independent legal counsel or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the Delaware General Corporation Law, nor an actual determination by the corporation (including its Board of Directors, independent legal counsel or its stock-holders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct. Section 6. Non-Exclusivity of Rights. The rights conferred on any ------------------------- person by this Bylaw shall not be exclusive of any other right which such person may have or hereafter acquire under any statute, provision of the Certificate of Incorporation, as amended, Bylaws, agreement, vote of stockholders or disinterested Directors or otherwise, both as to action in such person's official capacity and as to action in another capacity while holding office. The corporation is specifically authorized to enter into individual contracts with any or all of its Directors, officers, employees or agents respecting indemnification and advances, to the fullest extent not prohibited by the Delaware General Corporation Law. Section 7. Survival of Rights. The rights conferred on any person by ------------------ this Bylaw shall continue as to a person who has ceased to be a Director, officer, employee or other agent and shall inure to the benefit of the heirs, executors and administrators of such a person. -13- Section 8. Insurance. To the fullest extent permitted by the --------- Delaware General Corporation Law, the corporation, upon approval by the Board of Directors, may purchase insurance on behalf of any person required or permitted to be indemnified pursuant to this Bylaw. Section 9. Amendments. Any repeal or modification of this Bylaw ---------- shall only be prospective and shall not affect the rights under this Bylaw in effect at the time of the alleged occurrence of any action or omission to act that is the cause of any proceeding against any agent of the corporation. Section 10. Saving Clause. If this Bylaw or any portion hereof shall ------------- be invalidated on any ground by any court of competent jurisdiction, then the corporation shall nevertheless indemnify each Director and executive officer to the full extent not prohibited by any applicable portion of this Bylaw that shall not have been invalidated or by any other applicable law. Section 11. Certain Definitions. For the purposes of this Bylaw, the ------------------- following definitions shall apply: (a) The term "proceeding" shall be broadly construed and shall include, without limitation, the investigation, preparation, prosecution, defense, settlement, arbitration and appeal of, and the giving of the testimony in, any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative. (b) The term "expenses" shall be broadly construed and shall include, without limitation, court costs, attorneys' fees, witness fees, fines, amounts paid in settlement or judgment and any other costs and expenses of any nature or kind incurred in connection with any proceeding. (c) The term the "corporation" shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its Directors, officers, and employees or agents, so that any person who is or was a Director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a Director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under the provisions of this Bylaw with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued. (d) References to a "Director," "officer," "employee," or "agent" of the corporation shall include, without limitation, situations where such person is serving at the request of the corporation as a Director, officer, employee, trustee or agent of another corporation, partnership, joint venture, trust or other enterprise. (e) References to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to "serving at the request of the corporation" shall include any service as a Director, officer, employee or agent of the corporation which imposes duties on, -14- or involves services by, such Director, officer, employee, or agent with respect to an employee benefit plan, its participants, or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the partic-ipants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of the corporation" as referred to in this Bylaw. ARTICLE VIII LOANS TO OFFICERS ----------------- Section 1. Loans to Officers. The corporation may lend money to, ----------------- or guarantee any obligation of, or otherwise assist any officer or other employee of the corporation or of its subsidiaries, including any officer or employee who is a Director of the Corporation or its subsidiaries, whenever, in the judgment of the Board of Directors, such loan, guarantee or assistance may reasonably be expected to benefit the corporation. The loan, guarantee or other assistance may be with or without interest and may be unsecured, or secured in such manner as the Board of Directors shall approve, including, without limitation, a pledge of shares of stock of the corporation. Nothing in this Bylaw shall be deemed to deny, limit or restrict the powers of guaranty or warranty of the corporation at common law or under any statute. ARTICLE IX GENERAL PROVISIONS ------------------ Section 1. Declaration of Dividends. Dividends upon the capital ------------------------ stock of the corporation, subject to the provisions of the Certificate of Incorporation, as amended, if any, may be declared by the Board of Directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, in property, or in shares of the capital stock, subject to the provisions of the Certificate of Incorporation, as amended. Section 2. Dividend Reserve. Before payment of any dividend, there ---------------- may be set aside out of any funds of the corporation available for dividends such sum or sums as the Directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the corporation, or for such other purposes as the Directors shall think conducive to the interest of the corporation, and the Directors may modify or abolish any such reserve in the manner in which it was created. Section 3. Execution of Corporate Instruments. All checks or demands ---------------------------------- for money and notes of the corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate. Section 4. Fiscal Year. The fiscal year of the corporation shall be ----------- fixed by resolution of the Board of Directors. Section 5. Corporate Seal. The Board of Directors may adopt a -------------- corporate seal having inscribed thereon the name of the corporation, the year of its organization and the words "Corporate Seal, Delaware." The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise. -15- ARTICLE X AMENDMENTS ---------- Section 1. Amendments. ---------- (a) Except as otherwise set forth in Section 9 of Article VII of these Bylaws, the Bylaws may be altered or amended or new Bylaws adopted by the affirmative vote of a majority of the voting power of all of the then- outstanding shares of capital stock of the corporation entitled to vote generally in the election of Directors (the "Voting Stock"). The Board of Directors shall also have the power, if such power is conferred upon the Board of Directors by the Certificate of Incorporation, as amended, to adopt, amend or repeal Bylaws by a vote of the majority of the Board of Directors unless a greater or different vote is required pursuant to the provisions of the Bylaws, the Certificate of Incorporation or any applicable provision of law. (b) Notwithstanding any other provisions of these Bylaws or any provision of law which might otherwise permit a lesser vote or no vote, but in addition to any affirmative vote of the holders of any particular class or series of the Voting Stock required by law, the Certificate of Incorporation, as amended, or any Preferred Stock Designation (as the term is defined in the Certificate of Incorporation, as amended), the affirmative vote of the holders of at least sixty-six and two-thirds percent (66-2/3%) of the voting power of all of the then-outstanding shares of the Voting Stock, voting together as a single class, shall be required to alter, amend or repeal this paragraph (b) or Section 2, Section 5 or Section 10 of Article II or Section 1, Section 2 or Section 13 of Article III of these Bylaws. (c) Notwithstanding any other provisions of these Bylaws or any provision of law which might otherwise permit a lesser vote or no vote, but in addition to any affirmative vote of the holders of any particular class or series of the Voting Stock required by law, the Certificate of Incorporation, as amended, or any Preferred Stock Designation (as the term is defined in the Certificate of Incorporation, as amended), the affirmative vote of at least sixty-six and two-thirds percent (66-2/3%) of the Directors shall be required to alter, amend or repeal this paragraph (c) or Section 2, Section 5 or Section 10 of Article II or Section 1, Section 2 or Section 13 of Article III of these Bylaws. -16- CERTIFICATE OF SECRETARY The undersigned, being the Secretary of COMPS.COM , Inc., a Delaware corporation, does hereby certify the foregoing to be the Bylaws of said Corporation, as adopted by a majority of the stockholders and Directors of the Corporation and which remain in full force and effect as of the date hereof. Executed at San Diego, California effective as of February ___, 1999. __________________________________ Robert C. Beasley, Secretary EX-10.1 6 AMENDED AND RESTATED INVESTOR RIGHTS AGMT EXHIBIT 10.1 AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT THIS AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT is made and entered into as of February 9, 1998 by and among COMPS Infosystems, Inc., a Delaware corporation (the "Company") and the undersigned holders of the Company's stock and Robert C. Beasley (together, the "Stockholders") and amends and restates in its entirety that certain Investor Rights Agreement dated as of October 14, 1994 (the "1994 Agreement") by and among the Company and the Stockholders. RECITALS: -------- WHEREAS, as a condition to purchasing the Company's Series B Preferred Stock and Class B Common Stock Warrants, Summit Ventures III, L.P., Summit Investors II, L.P., Christopher A. Crane and Merrill Oster, (the "Purchasers") have requested that the Company extend to them registration rights, a right of first refusal, repurchase rights and certain other rights as set forth below. WHEREAS, certain of the Stockholders are holders of the Company's Series A Preferred Stock and possess registration rights, rights of first refusal repurchase rights and certain other rights pursuant to the 1994 Agreement. WHEREAS, Stockholders holding a sufficient number of Securities (as defined in the 1994 Agreement) desire to amend the 1994 Agreement, and the Company desires to amend and restate the 1994 Agreement as set forth below. AGREEMENT: --------- NOW, THEREFORE, in consideration of the mutual promises, representations, warranties, covenants and conditions set forth herein, (i) the Company and Stockholders hereby agree that the 1994 Agreement shall be superseded and deemed null and void and replaced in its entirety by this Agreement, (ii) the Stockholders hereby waive the provisions of Article III of the 1994 Agreement with respect to the issuance to the Purchasers of up to 637,790 shares of the Company's Series B Preferred Stock and Warrants to purchase up to 306,097 shares of the Company's Class B Common Stock and 37,329 shares of the Company's Class A Common Stock pursuant to that certain Stock and Warrant Purchase Agreement of even date herewith among the Company and the Purchasers, and the Company hereby consents to such waiver and (iii) the parties hereto further agree as follows: I. GENERAL A. Definitions. As used herein: ----------- 1. The terms "register", "registered" and "registration" refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act of 1933, as amended (the "Securities Act"), and the declaration or ordering of the effectiveness of such registration statement. 2. For the purposes hereof, the term "Registrable Securities" means shares of (i) any and all Common Stock of the Company issued or issuable upon conversion of shares of the Series A Preferred Stock of the Company or Series B Preferred Stock of the Company and any and all Common Stock issued as of or upon the date hereof to the Purchasers; (ii) any and all Common Stock issued or issuable upon exercise of Class B Common Stock Warrants and Class A Common Stock Warrants issued to the Purchasers on or prior to the date hereof, (iii) any and all Common Stock issued or issuable upon exercise of the Director Options (as defined in subsection 6, below); (iv) stock issued with respect to or in any exchange for or in replacement of stock included in subparagraph (i), (ii), or (iii) above; (iv) stock issued in respect of the stock referred to in (i), (ii), (iii) and (iv) above as a result of a stock split, stock dividend, recapitalization or similar event or the like. 3. The terms "Holder" or "Holders" mean any person or persons to whom Registrable Securities were originally issued and who execute this Agreement and qualifying transferees under Section II(J) hereof who hold Registrable Securities. 4. The term "Initiating Holders" means any Holder or Holders of not less than 50% of the aggregate of Registrable Securities. 5. The term "Form S-3" means such form under the Securities Act as in effect on the date hereof or any successor registration form under the Securities Act subsequently adopted by the SEC which permits inclusion or incorporation of substantial information by reference to other documents filed by the Company with the SEC. 6. The term "Securities" shall mean the Company's Series A Preferred Stock, Series B Preferred Stock, Class B Common Stock Warrants, Class A Common Stock Warrants, any options to purchase shares of the Company's equity securities issued to Gregory M. Avis (or his predecessor or successor as representative of the Purchasers) in his role as outside director ("Director Options"), and the Class A Common Stock issuable upon conversion of the Series A Preferred Stock and Series B Preferred Stock, the Class B Common Stock issuable upon exercise of the Class B Common Stock Warrants, the Class A Common Stock issuable upon exercise of the Class A Common Stock Warrants and upon conversion of the Class B Common Stock and any equity securities issuable upon exercise of the Director Options. 7. The term "Securities Act" shall mean the Securities Act of 1933, as amended. 8. The term "SEC" or "Commission" means the Securities and Exchange Commission. II. REGISTRATION A. Demand Registration. ------------------- 1. Request for Registration. In case the Company shall receive from ------------------------ the Initiating Holders a written request that the Company effect any registration with respect to all or part of the Registrable Securities, the Company will: 2 a. within ten (10) days after its receipt thereof give written notice of the proposed registration to all other Holders; and b. as soon as practicable, use its best efforts to effect such registration (including, without limitation, the execution of an undertaking to file post-effective amendments, appropriate qualifications under the applicable blue sky or other state securities laws and appropriate compliance with exemptive regulations issued under the Securities Act and any other governmental requirements or regulations) as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Holder's or Holders' Registrable Securities as are specified in such request, together with all or such portion of the Registrable Securities of any Holder or Holders joining in such request as are specified in a written request given within 20 days after receipt of such written notice from the Company; provided, that the Company shall not be obligated to take any action to effect such registration pursuant to this Section II(A)(1): (i) Prior to 180 days following the effective date of the Company's first registered offering to the general public of its securities for its own account; or (ii) In any particular jurisdiction in which the Company would be required to qualify to do business or execute a general consent to service of process in effecting such registration; or (iii) After the Company has effected two (2) such registrations pursuant to this Subsection II(A)(1) and such registrations have been declared or ordered effective; or (iv) If the Company qualifies to register the Registrable Securities pursuant to Form S-3. Subject to the foregoing clauses (i) through (iv), the Company shall file a registration statement covering the Registrable Securities so requested to be registered as soon as practical, but in any event within ninety (90) days after receipt of the request or requests of the Initiating Holders; provided, however, that if the Company shall furnish to such Holders a certificate signed by the President or Chief Executive Officer of the Company stating that in the reasonable judgment of the Board of Directors it would be seriously detrimental to the Company and its shareholders for such registration statement to be filed at the date filing would be required and it is therefore essential to defer the filing of such registration statement, the Company shall be entitled to delay the filing of such registration statement not more than once in any twelve month period for an additional period of up to sixty (60) days. 2. Underwriting. If the Initiating Holders intend to distribute the ------------ Registrable Securities covered by their request by means of an underwriting, they shall so advise the Company as a part of their request made pursuant to Section II(A)(1) and the Company shall include such information in the written notice referred to in Subsection II(A)(1)(a). The right of any Holder to registration pursuant to Section II(A)(1) shall be conditioned upon such Holder's participation in such underwriting and the inclusion of such Holder's Registrable Securities in the underwriting (unless otherwise mutually agreed by a majority in interest of the Initiating 3 Holders and such Holder) to the extent provided herein. The Company shall (together with all Holders proposing to distribute their securities through such underwriting) enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by a majority in interest of the Initiating Holders. Notwithstanding any other provision of this Section 2, if the underwriter advises the Initiating Holders in writing that marketing factors require a limitation of the number of shares to be underwritten, the Initiating Holders shall so advise all Holders of Registrable Securities who have elected to participate in such offering, and the number of shares of Registrable Securities that may be included in the registration and underwriting shall be allocated among all such Holders thereof in proportion, as nearly as practicable, to the respective amounts of Registrable Securities held by such Holders. If any Holder of Registrable Securities disapproves of the terms of the underwriting, he may elect to withdraw therefrom by written notice to the Company, the underwriter and the Initiating Holders. Any Registrable Securities which are excluded from the underwriting by reason of the underwriter's marketing limitation or withdrawn from such underwriting shall be withdrawn from such registration. If the underwriter has not limited the number of Registrable Securities to be underwritten, the Company, employees of the Company and other holders of the Company's Common Stock may include securities for its (or their) own account in such registration if the underwriter so agrees and if the number of Registrable Securities which would otherwise have been included in such registration and underwriting will not thereby be limited. B. Company Registration. -------------------- 1. Registration. If at any time or from time to time, the Company ------------ shall determine to register any of its securities, for its own account or the account of any of its stockholders, other than a registration on Form S-8 relating solely to employee stock option or purchase plans, or a registration on Form S-4 relating solely to an SEC Rule 145 transaction, or a registration on any other form (other than Form S-1, S-2 or S-3 or SB-2, or their successor forms), or any successor to such form which does not include substantially the same information as would be required to be included in a registration statement covering the sale of Registrable Securities, the Company will: a. promptly give to each Holder written notice thereof, and b. include in such registration (and any related qualification under blue sky laws or other compliance with applicable laws), and in any underwriting involved therein, all the Registrable Securities specified in a written request or requests, made within 20 days after receipt of such written notice from the Company, by any Holder or Holders to be included in any such registration, except as set forth in Subsection II(B)(2) below. 2. Underwriting. If the registration of which the Company gives ------------ notice is for a registered public offering involving an underwriting, the Company shall so advise the Holders as a part of the written notice given pursuant to Subsection II(B)(1)(a). In such event the right of any Holder to registration pursuant to Section II(B) shall be conditioned upon such Holder's participation in such underwriting and the inclusion of such Holder's Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their securities through such underwriting shall (together with the Company and the other holders distributing their securities through such underwriting) enter into an underwriting agreement in 4 customary form with the underwriter or underwriters selected for such underwriting by the Company. Notwithstanding any other provision of this Section II(B), if the underwriter determines that marketing factors require a limitation of the number of shares to be underwritten, the underwriter may limit the number of Registrable Securities to be included in the registration and underwriting. Notwithstanding the foregoing, in no event shall the amount of securities of the selling Holders included in the offering be reduced below thirty percent (30%) of the total amount of the securities included in such offering, unless such offering is the initial public offering of the Company's securities, in which case the selling Holders may be excluded if the underwriters make the determination described above and no other shareholders' securities are included. In the event of a cutback by the underwriters of the number of Registrable Securities to be included in the registration and underwriting, the Company shall advise all Holders of Registrable Securities which would otherwise be registered and underwritten pursuant hereto, and the number of shares of Registrable Securities that may be included in the registration and underwriting shall be allocated among all of such Holders in proportion, as nearly as practicable, to the respective amounts of Registrable Securities held by such Holders. If any Holder disapproves of the terms of any such underwriting, he may elect to withdraw therefrom by written notice to the Company and the underwriter. Any Registrable Securities excluded or withdrawn from such underwriting shall be withdrawn from such registration. C. Form S-3. After the Company has qualified for the use of Form S-3, or -------- its successor form, Holders of at least ten percent (10%) of the outstanding Registrable Securities shall have the night to request an unlimited number of registrations on Form S-3 (such requests shall be in writing and shall state the number of shares of Registrable Securities to be disposed of and the intended method of disposition of shares by such Holders), subject only to the following: 1. The Company shall not be required to effect a registration pursuant to this Section II(C) within 180 days of the effective date of any registration referred to in Sections II(A) or II(B) above. 2. The Company shall not be required to effect more than one such registration in any consecutive 6-month period. 3. The Company shall not be required to effect a registration unless the anticipated aggregate gross proceeds from the requested registration will equal or exceed one hundred thousand dollars ($100,000). The Company shall promptly give written notice to all Holders of Registrable Securities of the receipt of a request for registration pursuant to this Section II(C) and shall provide a reasonable opportunity for other Holders to participate in the registration, provided that if the registration is for an underwritten offering, the terms of Subsection II(A)(2) shall apply to all participants in such offering. Subject to the foregoing, the Company will use its best efforts to effect promptly the registration of all shares of Registrable Securities on Form S-3 to the extent requested by the Holder or Holders thereof for purposes of disposition; provided, however, that if the Company shall furnish to such Holders a certificate signed by the President or Chief Executive Officer of the Company stating that in the good faith judgment of the Board of Directors it would be seriously detrimental to the Company for such registration statement to be filed at the date filing would be required and it is therefore essential to defer the filing of such 5 registration statement, the Company shall be entitled to delay the filing of such registration statement not more than once in any 12 month period for an additional period of up to sixty (60) days. Any registration pursuant to this Section II(C) shall not be counted as a registration pursuant to Section II(A). D. Expenses of Registration. All expenses incurred in connection with any ------------------------ registration, qualification or compliance pursuant to this Agreement, including without limitation, all registration, filing and qualification fees, printing expenses, fees and disbursements of counsel for the Company and expenses of any special audits incidental to or required by such registration, shall be borne by the Company except as follows: 1. The Company shall not be required to pay for expenses of any registration proceeding begun pursuant to Sections II(A) or II(C), the request for which has been subsequently withdrawn by the Initiating Holders, in which case, such expenses shall be borne by the Holders requesting such withdrawal; provided, however, that in lieu of paying such expenses a majority in interest of the Initiating Holders may elect to forfeit the right of the holders of Registrable Securities to request one registration pursuant to Section II(A) or II(C). Notwithstanding the foregoing, if at the time of such withdrawal (i) the Holder has teamed of a material adverse change in the condition, business or prospects of the Company from that known to the Holder at the time of its request, and (ii) the Company knew or had reason to know of the likelihood of such material adverse change at the time of its request and did not inform the Holder thereof, then the Company shall be required to pay such expenses and the Holder shall retain its rights pursuant to Section II(A) or II(C). 2. The Company shall not be required to pay reasonable fees of legal counsel of a Holder except for a single counsel acting on behalf of all selling Holders. 3. The Company shall not be required to pay underwriters' fees, discounts or commissions relating to the Registrable Securities. E. Registration Procedures. In the case of each registration, ----------------------- qualification or compliance effected by the Company pursuant to this Agreement, the Company will keep each Holder participating therein advised in writing as to the initiation of each registration, qualification and compliance and as to the completion thereof. At its expense the Company will: 1. Prepare and file with the SEC a registration statement with respect to such Registrable Securities and use its best efforts to cause such registration statement to become effective, and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective for up to one hundred twenty 1 120) days. 2. Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement. 3. Furnish to the Holders such numbers of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other 6 documents as they may reasonably request in order to facilitate the disposition of Registrable Securities owned by them. 4. Use its best efforts to register and qualify the securities covered by such registration statement under such other securities or Blue Sky laws of such jurisdictions as shall be reasonably requested by the Holders, provided that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process in any such states or jurisdictions. 5. In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter of such offering. Each Holder participating in such underwriting shall also enter into and use best efforts to perform its obligations under such an agreement. 6. Notify each Holder of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing. 7. Furnish, at the request of any Holder, on the date that the securities are delivered to the underwriters for sale in connection with a registration being sold through underwriters, (i) an opinion, if any, dated such date, of the counsel representing the Company for the purposes of such registration, in form and substance as is customarily given to underwriters in an underwritten public offering, addressed to the underwriters and to the Holders and (ii) a letter dated such date, from the independent certified public accountants of the Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering, addressed to the underwriters, if any, and to the Holders requesting of Registrable Securities. F. Indemnification. --------------- 1. The Company will indemnify and hold harmless each Holder of Registrable Securities, each of its officers, directors and partners, and each person controlling such Holder within the meaning of Section 15 of the Securities Act, with respect to which such registration, qualification or compliance has been effected pursuant to this Agreement, and each underwriter, if any, and each person who controls any underwriter of the Registrable Securities held by or issuable to such Holder, against all claims, losses, expenses, damages and liabilities (or actions in respect thereto) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any registration statement, preliminary or final prospectus, or any amendment or supplement thereto, offering circular or other document (including any related registration statement, notification or the like) incident to any such registration, qualification or compliance, or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or any violation or alleged violation by the Company relating to action or inaction required of the Company in connection with any rule or regulation promulgated under 7 the Securities Act or any state securities law applicable to the Company and will reimburse each such Holder within the meaning of Section 15 of the Securities Act, each of its officers, directors and partners, and each person controlling such Holder, each such underwriter and each person who controls any such underwriter, for any reasonable legal and any other expenses, as incurred, in connection with investigating, defending or settling any such claim, loss, damage, liability or action; provided, however, that the Company will not be liable in any such case to the extent that any such claim, loss, damage or liability arises out of or is based on any untrue statement or omission based upon written information furnished to the Company in an instrument duly executed by such Holder or underwriter specifically for use therein, and provided further that the agreement of the Company to indemnify any underwriter and any person who controls such underwriter contained herein with respect to any such preliminary prospectus shall not inure to the benefit of any underwriter, from whom the person asserting any such claim, loss, damage, liability or action purchased the stock which is the subject thereof, if at or prior to the written confirmation of the sale of such stock, a copy of the prospectus (or the prospectus as amended or supplemented) was not sent or delivered to such person, excluding the documents incorporated therein by reference, and the untrue statement or omission of a material fact contained in such preliminary prospectus was corrected in the prospectus (or the prospectus as amended or supplemented). 2. Each Holder will, if Registrable Securities held by or issuable to such Holder are included in the securities as to which such registration, qualification or compliance is being effected, indemnify and hold harmless the Company, each of its directors and officers, each underwriter, if any, of the Company's securities covered by such a registration statement, each person who controls the Company within the meaning of the Securities Act, and each other such Holder, each of its officers, directors and partners and each person controlling such Holder, against all claims, losses, expenses, damages and liabilities (or actions in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any preliminary or final prospectus, offering circular or other document (including any related registration statement, notification or the like) incident to any such registration, qualification or compliance or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse the Company, such Holders, such directors, officers, partners, persons or underwriters for any reasonable legal or any other expenses incurred in connection with investigating, defending or settling any such claim, loss, damage, liability or action, in each case to the extent, but only to the extent, that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such registration statement, prospectus, offering circular or other document in reliance upon and in conformity with written information furnished to the Company in an instrument duly executed by such Holder specifically for use therein, and provided further that the agreement of the holder to indemnify any underwriter and any person who controls such underwriter contained herein with respect to any such preliminary prospectus shall not inure to the benefit of any underwriter, from whom the person asserting any such claim loss, damage, liability or action purchased the stock which is the subject thereof, if at or prior to the written confirmation of the sale of such stock, a copy of the prospectus (or the prospectus as amended or supplemented) was not sent or delivered to such person, excluding the documents incorporated therein by reference, and the untrue statement or omission of a material fact contained in such preliminary prospectus was corrected in the prospectus (or the prospectus as amended or supplemented). Notwithstanding the foregoing, in no event shall the indemnification provided 8 by any Holder hereunder exceed the gross proceeds received by such Holder for the sale of such Holder's securities pursuant to such registration. 3. Each party entitled to indemnification under this Section II(F) (the "Indemnified Party") shall give notice to the party required to provide indemnification (the "Indemnifying Party") promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought. The Indemnified Party she promptly permit the Indemnifying Party to assume the defense of any such claim or any litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or litigation, shall be approved by the Indemnified Party (whose approval shall not be unreasonably be withheld). The Indemnified Party may participate in such defense and hire counsel at such party's own expense. The failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations hereunder, unless such failure is materially prejudicial to an Indemnifying Party's ability to defend such action. No Indemnifying Party, in the defense of any such claim or litigation, shall, except with the consent of the Indemnified Party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation. Any Indemnified Party shall cooperate with the Indemnifying Party in the defense of any claim or litigation brought against such Indemnified Party. G. Lock-Up Provision. Upon receipt of a written request by the Company or ----------------- by its underwriters, the Holders shall not sell, sell short, grant an option to buy, or otherwise dispose of shares of the Company's Common Stock or other securities (except for any such shares included in the registration) for a period of one hundred and eighty (180) days following the effective date of the initial registration of the Company's securities; provided, however, that such Holder shall have no obligation to enter into the agreement described in this Section II(G) unless all executive officers, directors and holders of three percent (3%) or more of the outstanding voting securities of the Company and all other Holders and holders of other registration rights from the Company enter into similar agreements. The Company may impose stop-transfer instructions with respect to the shares (or securities) subject to the foregoing restriction until the end of said 120-day period. H. Information by Holder. The Holder or Holders of Registrable Securities --------------------- included in any registration shall promptly furnish to the Company such information regarding such Holder or Holders and the distribution proposed by such Holder or Holders as the Company may request in writing and as shall be required in connection with any registration, qualification or compliance referred to herein. I. Rule 144 Reporting. With a view to making available to Holders of ------------------ Registrable Securities the benefits of certain rules and regulations of the SEC which may permit the sale of the Registrable Securities to the public without registration, at all times after 90 days after the effective date of the first registration filed by the Company for an offering of its securities to the general public the Company agrees to: 1. Make and keep public information available, as those terms are understood and defined in SEC Rule 144. 9 2. File with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Securities Exchange Act of 1934, as amended (the "Exchange Act"). 3. So long as a Holder owns any Registrable Securities, to furnish to such Holder forthwith upon such Holder's request a written statement by the Company as to its compliance with the reporting requirements of said Rule 144 (at any time after 90 days after the effective date of the first registration statement filed by the Company for an offering of its securities to the public) and of the Securities Act and the Exchange Act (at any time after it has become subject to such reporting requirements), a copy of the most recent annual or quarterly report of the Company, and such other reports and documents so filed by the Company as such Holder may reasonably request in availing itself of any rule or regulation of the SEC allowing such Holder to sell any such securities without registration. J. Transfer of Registration Rights. A Holder's rights under Sections ------------------------------- II(A), II(B), II(C) and II(I) may be assigned by any Holder to a transferee or assignee of at least 10% of a Holder's Registrable Securities (as adjusted for stock splits, stock dividends, recapitalizations and the like) not sold to the public or a transferee or assignee of any shares of its Registrable Securities not sold to the public that is a partner or affiliate of such Holder, provided, that the Company is given written notice by the Holder at the time of or within thirty (30) days after said transfer, stating the name and address of said transferee or assignee and identifying the securities with respect to which such registration rights are being assigned. No such transfer or assignment shall be effective until such transferee or assignee agrees in writing to become subject to the obligations of the transferring Holder hereunder. K. Limitations on Subsequent Registration Rights. From and after the date --------------------------------------------- of this Agreement, the Company shall not, without the prior written consent of the Holders of a majority of the outstanding Registrable Securities, enter into any agreement with any holder or prospective holder of any securities of the Company which would allow such holder or prospective holder (a) to include such securities in any registration filed under Section II(A), II(B) or II(C) hereof, unless under the terms of such agreement, such holder or prospective holder may include such securities in any such registration only to the extent that the inclusion of its securities will not reduce the number of amount of the Registrable Securities of the Holders which are included or (b) to make a demand registration which could result in such registration statement being declared effective prior to the earlier of either of the dates set forth in Subsection II(A)(1)(b)(i). L. Termination. The rights of all Holders under this Agreement shall ----------- terminate on the fifth anniversary of the closing of the Company's first registered public offering of its securities; provided however, that the -------- Company's reporting obligations under SEC Rule 144 as set forth in Section 10 above, shall survive the termination of this Agreement. III. RIGHT OF FIRST REFUSAL If, at any time prior to the expiration of the period set forth in Section IV(B) below, the Company should desire to issue in any transaction not registered under the Securities Act in reliance upon a claimed exemption thereunder, any Equity Securities (as defined in Subsection 10 (E) below), it shall give each Stockholder a first right of refusal to purchase such Stockholder's pro rata share (or any part thereof) of all of such privately offered Equity Securities on the same terms as the Company is willing to sell such Equity Securities to any other person. The Stockholder's pro rata share of the Equity Securities shall be equal to the percentage that the Equity Securities of the Company held by the Stockholder on an as-converted basis on the date of the Company's written notification referred to in subparagraph (A) below, bears to all outstanding Equity Securities of the Company on the date of such written notification. A. Notices. Prior to any sale or issuance by the Company of any Equity ------- Securities, the Company shall notify each Stockholder, in writing, of its bona fide intention to sell and issue such Equity Securities, setting forth any material terms under which it proposes to make such sale. Within fifteen (15) days after receipt of such notice, each Stockholder shall notify the Company whether the Stockholder exercises its option and elects to purchase the Stockholder's pro rata share (or any part hereof) of the Equity Securities so offered. B. Procedure. If any Stockholder has failed to exercise its option to --------- purchase all of its pro rata portion of the Equity Securities upon the terms and conditions set forth in the Subsection (A) notice, the Company may, during the period of ninety (90) days following the expiration of such option period, sell and issue such securities as to which such Stockholder has not exercised its option to any other person upon the same terms and conditions as those set forth in the notice to the Stockholders. In the event the Company has not sold the Equity Securities within said ninety (90) day period, the Company shall not thereafter issue or sell any Equity Securities without first offering such securities to the Stockholders in the manner provided above. C. Closing. If a Stockholder gives the Company notice that it desires to ------- purchase any of the Equity Securities offered by the Company, payment for the Equity Securities shall be by check, or wire transfer, against delivery of the securities at the executive offices of the Company within ten (10) days after giving the Company such notice, or, if later, the closing date for the sale of such Equity Securities to third parties. The Company shall take all such action as may be required by any regulatory authority in connection with the exercise by the Stockholder of the right to purchase Equity Securities as set forth in this Section III. D. Exceptions. The right of first refusal contained in this Section III ---------- shall not apply to (i) the issuance by the Company of Equity Securities exclusively to employees or directors of, or consultants to the Company pursuant to the approval of the Board of Directors, (ii) the issuance of Common Stock of the Company upon conversion of Preferred Stock, (iii) the issuance of Class A Common Stock upon conversion of Class B Common Stock, or (iv) any Equity Securities issued in connection with an acquisition or SEC Rule 145 transaction. E. "Equity Securities". The term "Equity Securities" shall mean (i) ------------------- Common Stock, rights, options or warrants to purchase Common Stock; (ii) any other instrument convertible into Common Stock; (iii) any security convertible into or exchangeable for any of the foregoing. F. Assignment. A Purchaser's right to purchase any Equity Securities ---------- pursuant to this Section III may be assigned by the Purchaser to an affiliate of the Purchaser. For the purposes of this subparagraph (F), an "affiliate" shall mean any partner or shareholder of the 11 Purchaser, any person or entity that director or indirectly through one or more intermediaries controls or is controlled by or is under common control with a Purchaser. A right to purchase any Equity Securities pursuant to this Section III shall not be assignable. IV. REPURCHASE A. Put Option. ---------- 1. Exercise of Option. In the event that upon the earlier to occur ------------------ of (i) October 14, 2001, (ii) a liquidation, dissolution, winding-up or (iii) the closing of an acquisition, merger, exchange of securities, sale of all or substantially all of the assets of Company, reorganization in which the Company is not the surviving entity or a stock issuance or "reverse merger" in which the Company is the surviving entity but under which the holders of the Company's securities prior to such stock issuance or reverse merger do not hold more than fifty percent (50%) of the voting securities of the Company following such stock issuance or reverse merger, the Purchasers continue to hold any Securities, any Purchaser may notify the Company that it intends to offer to the Company any or all of the Securities then held by it for purchase by the Company, and the Company shall be required to repurchase the Securities so offered under this Agreement as provided below. 2. Price. The price to be paid by the Company for the Securities to ----- be sold hereunder shall be the greater of (i) the Purchaser's original purchase price of such Securities (as set forth in the Purchase Agreement) plus all accrued and unpaid dividends through the date of the repurchase, and (ii) the fair market value of the Securities as of the date of such proposed repurchase as agreed upon by the Company and the Purchaser. If the Common Stock is publicly traded, fair market value, with respect to the Common Stock, shall mean the average over the preceding twenty (20) trading days of the mean of the closing bid and asked prices on the over-the-counter market as reported by Nasdaq, or if then traded on a national securities exchange or the Nasdaq National Market, the average over the preceding twenty (20) trading days of the mean of the high and low prices on the principal national securities exchange or the Nasdaq National Market on which it is so traded (or, in either event, such fewer number of days as such Common Stock has been so traded). If no such agreement is reached within thirty (30) days, the fair market value shall be determined by appraisal as set forth below. All appraisals shall be undertaken by two appraisers, one selected by the Company and one selected by the Purchasers of a majority of the Securities. The fair market value shall be the fair market value arrived at by those appraisers within sixty (60) days following the appointment of the last appraiser to be appointed. In the event that the two appraisers cannot agree on such fair market value within such a period of time, (i) if the appraisers' valuations are within 10% of each other the fair market value shall be the mean of the two valuations and (ii) if the differences in the valuations are greater, the appraisers shall elect a third appraiser who will calculate fair market value independently, and, except as provided in the next sentence, the fair market value of the Securities shall in each case be the average of the two fair market values arrived at by the appraisers who are closest in amount. If one appraiser's valuation is the mean of the other two valuations, the mean valuation shall be the fair market value. In the event that the two original appraisers cannot agree upon a third appraiser within thirty (30) days following the end of the sixty (60) day period referred to above, then the third appraiser shall be appointed by the 12 American Arbitration Association upon the request of either party. If, following the conclusion of any appraisal referred to above, a Purchaser shall choose not to sell any or all of its Securities, then it shall so notify the Company, within twenty (20) days following receipt of the appraisal. If the Purchaser chooses not to sell any or all of its Securities and after the initiation of the procedures outlined in Section IV(A), then its rights hereunder shall terminate with respect to all such securities not offered to the Company. The expenses of the appraiser chosen by the Company will be borne by it, the expenses of the appraiser chosen by the Purchasers will be borne by the Purchasers and the expenses of the third appraiser will be borne 50% by the Company and 50% by the Purchasers. 3. Payment. The Company shall, within sixty (60) days following ------- either the agreement, as provided above, with the Purchasers concerning the fair market value of the Securities or the receipt of the results of the appraisal referred to above, to the extent permitted by applicable law (the "Repurchase Date"), purchase the Securities tendered to it at the price established by the agreement or the appraisal and the Purchasers shall deliver to the Company, upon receipt of payment therefor, the certificates for the Securities duly endorsed by them. Payment shall be made by certified check or wire transfer of funds to such bank account or accounts as the Purchaser shall direct. B. Termination of Option. The obligation of the Company to purchase the --------------------- Purchased Common Stock as provided in this Agreement shall terminate upon (i) the closing of a Qualified Public Offering (as defined below); (ii) the closing of an acquisition, merger, exchange of securities, sale of all or substantially all of the assets of Company, reorganization in which the Company is not the surviving entity or a stock issuance or "reverse merger" in which the Company is the surviving entity but under which the holders of the Company's securities prior to such stock issuance or reverse merger do not hold more than fifty percent (50%) of the voting securities of the Company following such stock issuance or reverse merger; provided, however, that the Purchaser shall have the right to exercise the option granted pursuant to Section IV(A) hereof concurrently with such closing by delivering written notice of their intention to so exercise at least ten (10) days prior to the date of closing, and, provided further, that the Company shall provide the Holders not less than 30 days written notice of the closing of a transaction contemplated by this Section IV(B), or (iii) the liquidation of the Company. For purposes of this Agreement, a "Qualified Public Offering" shall mean an underwritten public offering in which the Company receives gross proceeds of not less than $10 million at a purchase price per share of not less than $3.73 (as adjusted for stock splits, dividends, recapitalization and the like). V. MISCELLANEOUS A. Notices. All notices or other communications required or permitted to ------- be delivered hereunder shall be in writing signed by the party giving the notice to the Company at 9888 Carroll Centre Road, Suite 100, San Diego, CA 92126-4581, Attn: President, and to the Purchasers at the addresses listed opposite their names in Schedule A attached hereto. Any Purchaser may at any time change the ---------- address to which notice shall be mailed by giving notice of such change to the Company and to the other parties and such notice shall be deemed given when received by the other party hereto. 13 B. Amendment. This Agreement may be amended with the written consent of --------- the Company and the written consent of the holders of a majority of the Securities held by the Purchasers. C. Entire Agreement. This Agreement constitutes the entire agreement of ---------------- the parties with respect to the matters contemplated herein. This Agreement supersedes any and all prior understandings as to the subject matter of this Agreement. D. Binding Effect; Assignment. This Agreement shall be binding upon and -------------------------- inure to the benefit of the successors and assigns of the respective parties hereto, except that the Company shall not have the right to assign its rights hereunder or any interest herein, and the rights and interests of the Purchasers shall be assignable, without the consent of the Company, to any assignee. E. General. The headings contained in this Agreement are for reference ------- purposes only and shall not in any way affect the meaning or interpretation of this Agreement. In this Agreement the singular includes the plural, the plural the singular, the masculine gender includes the neuter, masculine and feminine genders. This Agreement shall be governed by and construed under the laws of the State of California. F. Severability. If any provision of this Agreement shall be found by any ------------ court of competent jurisdiction to be invalid or unenforceable, the parties hereby waive such provision to the extent that it is found to be invalid or unenforceable. Such provision shall, to the maximum extent allowable by law, be modified by such court so that it becomes enforceable, and, as modified, shall be enforced as any other provision hereof, all the other provisions hereof continuing in full force and effect. G. Counterparts. This Agreement may be executed in counterparts, all of ------------ which together shall constitute one and the same instrument. H. Dispute Resolution. The parties acknowledge and agree that time is of ------------------ the essence in resolving any dispute that may arise in connection with this Agreement. Except as provided herein, any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be settled by binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"). The expenses of the arbitration, including the arbitrator's fees, expert witness fees, and attorneys' fees, may be awarded to the prevailing party, in the discretion of the arbitrator, or may be apportioned between the parties in any manner deemed appropriate by the arbitrator. Unless and until the arbitrator decides that one party is to pay for all (or a share) of such expenses, the Company shall pay all reasonable expenses, including legal and accounting fees and costs arising in connection with enforcement of this Agreement or the Collateral Agreements. The parties shall keep confidential the decision of the arbitrator. Notwithstanding the foregoing, the parties may disclose information about such decision to persons who have a need to know, such as limited partners, directors, trustees, management employees, witnesses, experts, investors, attorneys, lenders, insurers, and others who may be affected. Once the arbitration award has become final if the arbitration award is not promptly satisfied, then these confidentiality provisions shall no longer be applicable. Notwithstanding the 14 foregoing, the parties will be entitled to enforce their rights under this Agreement specifically (without posting a bond or other security). The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and any party may in its sole discretion apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive relief in order to enforce or prevent any violation of the provisions of this Agreement. IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date first above written. COMPS INFOSYSTEMS, INC. THE PURCHASERS SUMMIT VENTURES III, L.P. By: Summit Partners III, L.P. By: /s/ CHRISTOPHER A. CRANE its General Partner ------------------------------- By: Stamps, Woodsum & Co. III, Christopher A. Crane, President its General Partner By: /s/ GREGORY M. AVIS ------------------------------- Gregory M. Avis, General Partner /s/ ROBERT C. BEASLEY SUMMIT VENTURES II, L.P. ------------------------------- Robert C. Beasley in his individual capacity By: /s/ GREGORY M. AVIS ------------------------------- Gregory M. Avis, General Partner /s/ CHRISTOPHER A. CRANE ------------------------------- Christopher A. Crane in his individual capacity /s/ MERRILL OSTER ------------------------------- Merrill Oster in his individual capacity 15 Schedule A ---------- Purchasers Address - ---------- ------- Christopher A. Crane c/o COMPS InfoSystems, Inc. 9888 Carroll Centre Road, Suite 100 San Diego, CA 92126-4581 (619) 578-3000 Summit Ventures III, L.P. 499 Hamilton Avenue, Suite 200 Palo Alto, CA 94301 (650) 321-1166 Summit Investors II, L.P. 499 Hamilton Avenue, Suite 200 Palo Alto, CA 94301 (650) 321-1166 Merrill Oster c/o COMPS InfoSystems, Inc. 9888 Carroll Centre Road, Suite 100 San Diego, CA 92126-4581 (619) 578-3000 EX-10.2 7 STOCK AND WARRANT PURCHASE AGMT DATED 10/14/94 Exhibit 10.2 COMPS INFOSYSTEMS, INC. STOCK AND WARRANT PURCHASE AGREEMENT THIS AGREEMENT is made as of October 14, 1994, by and among COMPS Infosystems, Inc., a Delaware corporation (the "Company"), those entities, severally and not jointly, whose names are set forth on the Schedule of Purchasers attached hereto as Exhibit A (collectively, "Purchasers," and --------- individually, a "Purchaser") and Christopher A. Crane and Robert C. Beasley (the "Stockholders"). The parties hereby agree as follows: 1. Sale and Issuance of the Shares and Warrants. -------------------------------------------- 1.1 Sale and Issuance of the Series A Preferred Shares. Subject to -------------------------------------------------- the terms and conditions hereof, the Company will issue and sell to each Purchaser and each Purchaser will purchase the number of shares of the Company's Series A Preferred Stock (the "Shares") specified opposite the Purchaser's name on Exhibit A, at a price of $1.17087 per Share. --------- 1.2 Issuance of Warrants. In consideration for the purchase by the -------------------- Purchasers of the Shares, the Company will issue to each Purchaser a warrant in the form attached hereto as Exhibit B (individually, a "Warrant" and collectively, the "Warrants"), to purchase up to the number of shares of the Company's non-voting Class B Common Stock (the "Warrant Shares") set forth opposite such Purchaser's name on Exhibit A at an exercise price of $.01 per --------- share. 2. Closing Date; Delivery. ---------------------- 2.1 Closing Date. ------------ (a) Purchase and Sale. The closing of the purchase and sale of ----------------- an aggregate of 4,270,336 Shares and of the issuance of the Warrants to purchase 379,869 shares of Class B Common Stock shall be held at the offices of Latham & Watkins, 701 B Street, Suite 2100, San Diego, CA 92101 at 1:00 p.m. on October 14, 1994, or at such other time and place as the Company and the Purchasers may agree in writing. (b) Closing. The closing referred to in Subsection (a) above is ------- hereinafter referred to as the "Closing" and the date of the Closing is hereinafter referred to as the "Closing Date". 2.2 Delivery. Subject to the terms of this Agreement, at the Closing -------- the Company will deliver to each Purchaser a certificate representing the Shares to be purchased by and the Warrant to be issued to such Purchaser from the Company, against payment of the purchase price for the Shares by a check or checks payable to the order of the Company, or by wire transfer. 3. Representations and Warranties of the Company. The Company and the --------------------------------------------- Stockholders hereby represent and warrant to the Purchasers that except as set forth on a Schedule of Exceptions attached hereto as Exhibit C, which exceptions --------- shall be deemed to be representations and warranties as if made hereunder: -1- 3.1 Organization and Standing; Articles and By-Laws. The Company is ----------------------------------------------- a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its businesses as now conducted and as proposed to be conducted. The Company is qualified or licensed to do business as a foreign corporation in all jurisdictions where such qualification or licensing is required, except where the failure to so qualify would not have a material adverse effect upon the Company. Complete copies of the Company's Certificate of Incorporation, Bylaws, minutes and consents of stockholders and of the Board of Directors are available for inspection at the Company's offices and have been previously provided to special counsel for the Purchasers. 3.2 Corporate Power. The Company has now, or will have at the --------------- Closing Date, all requisite corporate power to enter into this Agreement, the Investor Rights Agreement (the "Investor Rights Agreement") in the form attached hereto as Exhibit D, the Right of First Refusal and Co-Sale Agreement attached --------- hereto as Exhibit E (the "Co-Sale Agreement"), and the Shareholder Buy-Out and --------- Voting Agreement attached hereto as Exhibit F (the "Shareholder Buy-Out and --------- Voting Agreement") (together, the "Collateral Agreements") and to sell and issue the Shares and Warrants and the Warrant Shares upon exercise of the Warrants and to issue the Company's Class A Common Stock upon conversion of the Shares. This Agreement and each of the Collateral Agreements is a valid and binding obligation of the Company enforceable in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, moratorium, and other laws of general application affecting the enforcement of creditors' rights. 3.3 Subsidiaries. The Company does not control, directly or indirectly, any other corporation, association or business entity. 3.4 Capitalization. The authorized capital stock of the Company is -------------- 25,000,000 shares of Common Stock of which 22,500,000 shares are designated as Class A Common Stock and 2,500,000 shares are designated as Class B Common Stock and 5,000,000 shares of preferred stock ("Preferred Stock") of which 4,270,336 shares are designated as Series A Preferred Stock. There are issued and outstanding 6,482,000 shares of the Company's Class A Common Stock. All issued and outstanding shares have been duly authorized and validly issued, are fully paid and nonassessable, and were issued in compliance with all applicable state and federal laws concerning the issuance of securities. There are 811,160 shares of Class B Common Stock reserved for issuance to the Company's officers, directors, employees and consultants pursuant to Company compensation plans, and 379,869 shares of Class B Common Stock reserved for issuance to holders of the Warrants upon exercise of the Warrants. The Company has provided the Purchasers with a complete and accurate list, as of immediately prior to the Closing, of all holders of any and all rights, options, warrants or conversion rights to purchase or acquire from the Company any of its capital stock, along with the number of shares of capital stock issuable upon exercise of such rights. Except for such rights, there are no outstanding rights, options, warrants, conversion rights or agreements for the purchase or acquisition from the Company of any shares of its capital stock. 3.5 Authorization. ------------- (a) Corporate Action. All corporate action on the part of the ---------------- Company, its officers, directors and stockholders necessary for the sale and issuance of the -2- Shares and Warrants pursuant hereto, the issuance of the Warrant Shares upon the exercise of the Warrants, the issuance of the Class A Common Stock issuable upon conversion of the Shares and the performance of the Company's obligations hereunder and under each of the Collateral Agreements has been taken or will be taken prior to the Closing. The Company has duly reserved an aggregate of 379,869 shares of Class B Common Stock for issuance upon exercise of the Warrants, and 4,270,336 shares of Class A Common Stock for issuance upon conversion of the Shares. (b) Valid Issuance. The Shares and Warrants, when issued in -------------- compliance with the provisions of this Agreement, the Warrant Shares, when issued in accordance with the terms of the Warrants and each of the Collateral Agreements, and the shares of Class A Common Stock issued upon conversion of the Shares when issued in accordance with the provisions of the Company's Certificate of Incorporation, will be validly issued, fully paid and nonassessable and will be free of any liens or encumbrances other than those created by the Purchasers; provided, however, that all such shares may be subject to restrictions on transfer under state and/or federal securities laws as set forth herein, and as may be required by future changes in such laws. The rights, preferences, privileges and restrictions of the Series A Preferred Stock are as set forth in the Restated Certificate of Incorporation, the form of which is attached hereto as Exhibit G (the "Restated Certificate"). (c) No Preemptive Rights. No person has any right of first -------------------- refusal or any preemptive rights in connection with the issuance of the Shares or Warrants, the issuance of the Warrant Shares upon exercise of the Warrants, the issuance of the Class A Common Stock upon conversion of the Shares or any future issuances of securities by the Company other than those held by the Purchasers or those contemplated by the Collateral Agreements. 3.6 Patents, Trademarks, etc. The Company owns and possesses or is ------------------------ licensed under all patents, patent applications, licenses, trademarks, trade names, brand names, inventions and copyrights employed in the operation of its business as now conducted and as proposed to be conducted, with no infringement of or conflict with the rights of others respecting any of the same. The operation of the Company's business as now conducted or as proposed to be conducted does not and will not infringe any patent or other proprietary rights of others respecting any of the same. The Company is not obligated to make any payments by way of royalties, fees or otherwise to any owner, licensor of, or other claimant to any patent, trademark, trade name, copyright or other intangible asset, with respect to the use thereof or in connection with the conduct of its business, or otherwise. The Company has not received any communications alleging that it has violated or, by conducting its business as proposed, would violate any of the patents, trademarks, service marks, trade names, copyrights or trade secrets or other proprietary rights of any other person or entity, nor is the Company aware of any basis for the foregoing. 3.7 Compliance with Other Instruments, None Burdensome, Etc. The ------------------------------------------------------- Company is not in violation of any term of its Restated Certificate or Bylaws, nor is the Company in violation of or in default in any material respect under the terms of any mortgage, indenture, contract, agreement, instrument, judgment or decree, the violation of which would have a material adverse effect on the Company as a whole, and is not in violation of any order, statute, rule or regulation applicable to the Company, the violation of which would have a -3- material adverse effect on the Company. The execution, delivery and performance of and compliance with this Agreement and each of the Collateral Agreements, and the issuance and sale of the Shares and Warrants pursuant hereto or of the Warrant Shares pursuant to the terms of the Warrants, will not (a) result in any such violation, or (b) be in conflict with or constitute a default under any such term, or (c) result in the creation of any mortgage, pledge, lien, encumbrance or charge upon any of the properties or assets of the Company pursuant to any such term. To the best knowledge of the Company, there is no such term which materially adversely affects, or in the future may materially adversely affect, the business, prospects, condition, affairs or operations of the Company or any of its properties or assets. 3.8 Proprietary Agreements; Employees. Each employee of the Company --------------------------------- has executed an agreement regarding confidentiality and proprietary information, the form of which has been provided to special counsel to the Purchasers. The Company is not aware that any of its employees is in violation thereof and will use its best efforts to prevent any such violation. The Company is not aware that any of its employees is obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, that would interfere with the use of his or her best efforts to promote the interests of the Company or that would conflict with the Company's business as conducted or as proposed to be conducted or that would prevent any such employee from assigning inventions to the Company. Neither the execution nor delivery of this Agreement or the Collateral Agreements, nor the carrying on of the Company's business as proposed, will, to the Company's knowledge, conflict with or result in a breach of the terms, conditions or provisions of, or constitute a default under, any contract, covenant or instrument under which any of such employees is now obligated. The Company does not believe that it is or will be necessary for the Company to utilize any inventions of any of its employees (or people it currently intends to hire) made prior to their employment by the Company. 3.9 Litigation, Etc. There is no action, proceeding or investigation --------------- pending against the Company or its officers, directors or stockholders, or to the best of the Company's knowledge, against employees or consultants of the Company (or, to the best of the Company's knowledge, any basis therefor or threat thereof): (1) which might result, either individually or in the aggregate, in (a) any material adverse change in the business, prospects, conditions, affairs or operations of the Company or in any of its properties or assets, or (b) any material impairment of the right or ability of the Company to carry on its business as now conducted or as proposed to be conducted, or (c) any material liability on the part of the Company; or (2) which questions the validity of this Agreement, the Collateral Agreements or any action taken or to be taken in connection herewith or thereunder, including in each case, without limitation, actions pending or threatened involving the prior employment of any of the Company's employees, the use in connection with the Company's business of any information or techniques allegedly proprietary to any of its former employees, or their obligations under any agreements with prior employers. The Company is not a party to or subject to the provisions of any order, writ, injunction, judgment or decree of any court or government agency or instrumentality. There is no action, suit, proceeding or investigation by the Company currently pending or which the Company currently intends to initiate. 3.10 Governmental Consent, Etc. No consent, approval or authorization ------------------------- of or designation, declaration or filing with any governmental authority on the part of the Company is -4- required in connection with: (a) the valid execution and delivery of this Agreement or either of the Collateral Agreements; or (b) the offer, sale or issuance of the Shares and Warrants, the issuance of the Warrant Shares upon exercise of the Warrants, or the issuance of the shares of Common Stock issuable upon conversion of the Preferred Stock or (c) the obtaining of the consents, permits and waivers specified in Subsection 5.1(b) hereof, except the filing of the Restated Articles and, if required, filings or qualifications under the California Corporate Securities Law of 1968, as amended (the "California Law"), or other applicable blue sky laws, which filings or qualifications, if required, will have been timely filed or obtained after the sale of the Shares and Warrants. 3.11 Offering. In reliance in part on the representations and -------- warranties of the Purchasers in Section 4 hereof, the offer, sale and issuance of the Shares and Warrants in conformity with the terms of this Agreement will not result in a violation of the requirements of Section 5 of the Securities Act of 1933, as amended (the "Securities Act") or the qualification or registration requirements of the California Law or other applicable blue sky laws. 3.12 Taxes. The Company has filed all tax returns that are required ----- to have been filed with appropriate federal, state, county and local governmental agencies or instrumentalities, except where the failure to do so would not have a material adverse effect upon the Company, taken as a whole. The Company has paid or established reserves for all income, franchise and other taxes, assessments, governmental charges, penalties, interest and fines due and payable by them on or before the Closing. There is no pending dispute with any taxing authority relating to any of such returns and the Company has no knowledge of any proposed liability for any tax to be imposed upon the properties or assets of the Company for which there is not an adequate reserve reflected in the Financial Statements (as defined below). 3.13 Title. The Company owns its property and assets, including the ----- properties and assets reflected in the Financial Statements, free and clear of all liens, mortgages, loans or encumbrances except liens for current taxes, and such encumbrances and liens which arise in the ordinary course of business and do not materially impair the Company's ownership or use of such property or assets. With respect to the property and assets leased by the Company, the Company is in compliance with such leases and, to the best of the Company's knowledge, holds valid leasehold interests free and clear of any liens, claims or encumbrances. 3.14 Material Contracts and Commitments. All of the contracts, ---------------------------------- mortgages, indentures, agreements, instruments and transactions to which the Company is a party or by which it is bound (including purchase orders to the Company or placed by the Company) which involve obligations of, or payments to, the Company in excess of Twenty-Five Thousand Dollars ($25,000) and all agreements between the Company and its stockholders, officers, directors, consultants and employees are either (i) attached as exhibits to this Agreement, or (ii) set forth on the list attached hereto as Exhibit H (the "Contracts"), --------- copies of which have been delivered to special counsel to the Purchasers. All of the Contracts are valid, binding and in full force and effect and enforceable by the Company in accordance with their respective terms in all material respects, subject to the effect of applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application relating to or affecting enforcement of creditors' rights and rules or laws concerning equitable remedies. The Company is not in material default under any -5- of such Contracts. To the best of the Company's knowledge, no other party to any of the Contracts is in material default thereunder. 3.15 Financial Statements. The Company has delivered to each -------------------- Purchaser its audited balance sheets as of December 31, 1992 and December 31, 1993 and its unaudited balance sheet as of August 31, 1994, (the "Balance Sheets") and its audited consolidated income statements and cash flow statements for the five month period ended December 31, 1992 and the twelve month period ended December 31, 1993 and its unaudited consolidated income statement and cash flow statement for the period ended August 31, 1994 (the above financial statements are hereinafter collectively referred to as the "Financial Statements"). The Financial Statements are complete and correct in all material respects and have been prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the relevant period. The Financial Statements accurately set out and describe the financial condition and operating results of the Company as of the date, and during the period, indicated therein. Except as set forth in the Financial Statements, the Company has no liabilities of any nature (matured or unmatured, fixed or contingent), other than (i) liabilities incurred in the ordinary course of business subsequent to August 31, 1994, and (ii) obligations under contracts and commitments incurred in the ordinary course of business and not required under generally accepted accounting principles to be reflected in the Financial Statements, which, individually or in the aggregate, are not material to the financial condition or operating results of the Company. The Company maintains and will continue to maintain a standard system of accounting established and administered in accordance with generally accepted accounting principles. 3.16 Absence of Changes. Since December 31, 1993: (a) the Company has ------------------ not entered into any transaction which was not in the ordinary course of business, (b) there has been no material adverse change in the condition (financial or otherwise) of the business, property, assets or liabilities of the Company other than changes in the ordinary course of its business, none of which, individually or in the aggregate, has been materially adverse, (c) there has been no damage to, destruction of or loss of physical property (whether or not covered by insurance) materially and adversely affecting the assets, prospects, financial condition, operating results. business or operations of the Company, (d) the Company has not declared or paid any dividend or made any distribution on its stock, or redeemed, purchased or otherwise acquired any of its stock, (e) the Company has not materially changed any compensation arrangement or agreement with any of its key employees or executive officers, or materially changed the rate of pay of its employees as a group, (f) the Company has not received notice that there has been a cancellation of an order for the Company's products or a loss of a customer of the Company, the cancellation or loss of which would materially adversely affect the business of the Company, (g) the Company has not changed or amended any material contract by which the Company or any of its assets are bound or subject, except as contemplated by this Agreement, (h) there has been no resignation or termination of employment of any key officer or employee of the Company and the Company does not know of any impending resignation or termination of employment of any such officer or employee that if consummated would have a material adverse effect on the business of the Company, (i) there has been no labor dispute involving the Company or its employees and none is pending or, to the best of the Company's knowledge, threatened, (j) there has been no change, except in the ordinary course of business, in the material contingent obligations of the Company (nor in any continent obligation of the Company regarding any -6- director, shareholder or key employee or officer of the Company) by way of guaranty, endorsement, indemnity, warranty or otherwise, (k) there have been no loans made by the Company to any of its employees, officers or directors other than travel advances and other advances made in the ordinary course of business, (1) there has been no waiver by the Company of a valuable right or of a material debt owing to it, (m) there has not been any satisfaction or discharge of any lien, claims or encumbrance or any payment of any obligation by the Company, except in the ordinary course of business and which is not material to the assets, properties, financial condition, operating results or business of the Company, and (n) to the best of the knowledge of the Company, there has been no other event or condition of any character pertaining to and materially adversely affecting the assets or business of the Company. 3.17 Outstanding Indebtedness. Except as disclosed in the Balance ------------------------ Sheets, the Company has no indebtedness for borrowed money which it has directly or indirectly created, incurred, assumed or guaranteed, or with respect to which it has otherwise become liable, directly or indirectly. 3.18 Registration Rights. Other than as granted pursuant to the ------------------- Investor Rights Agreement, the Company has not granted or agreed to grant any rights to register, as that term is defined in the Investor Rights Agreement of the Company's presently outstanding securities or any of its securities that may hereafter be issued. 3.19 Certain Transactions. The Company is not indebted, directly or -------------------- indirectly, to any of its officers, directors or stockholders or to their spouses or children, in any amount whatsoever; and none of said officers, directors or, to the best of the Company's knowledge, stockholders, or any member of their immediate families, are indebted to the Company or have any direct or indirect ownership interest in any firm or corporation with which the Company is affiliated or with which the Company has a business relationship (except as a holder of securities of a corporation whose securities are publicly traded and which is subject to the reporting requirements of the Securities Exchange Act of 1934, to the extent of owning not more than two percent (2%) of the issued and outstanding securities of such corporation). No such officer, director or stockholder, or any member of their immediate families, is, directly or indirectly, interested in any material contract with the Company. The Company is not guarantor or indemnitor of any indebtedness of any other person, firm or corporation. 3.20 Corporate Documents. Minute Books. Except for amendments ------------------- necessary to satisfy representations and warranties or conditions contained herein (the form of which amendments has been approved by the Purchaser), the Certificate of Incorporation and Bylaws of the Company are in the form previously provided to special counsel to the Purchaser. The minute books of the Company previously provided to special counsel to the Purchasers contain a complete summary of all meetings and corporate actions of directors and shareholders since the time of incorporation of the Company. 3.21 Employee Benefit Plans. With the exception of a 401(k) plan, the ---------------------- Company does not have any "employee benefit plan" as defined in the Employee Retirement Income Security Act of 1974, as amended. -7- 3.22 Real Property Holding Corporation. The Company is not a "real --------------------------------- property holding corporation" within the meaning of Section 897(c)(2) of the United States Internal Revenue Code of 1986, as amended. 3.23 Qualified Small Business. The Company is a "qualified small ------------------------ business" within the meaning of Section 1202(d) of the Internal Revenue Code of 1986, as amended, as of the date of issuance of the Shares. The Company will use reasonable efforts to comply with the reporting and recordkeeping, requirements of Section 1202 and any regulations promulgated thereunder if and for so long as it appears to the Company that the Purchasers may be able to obtain the benefits of Section 1202 and any such regulations. 3.24 Disclosure. No representation or warranty by the Company in this ---------- Agreement, or in any document or certificate furnished or to be furnished to the Purchasers pursuant hereto or in connection with the transactions contemplated hereby, when taken together, contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact necessary to make the statements made herein and therein, in the light of the circumstances under which they were made, not misleading; provided, however, that with regard to the operating projections which have been delivered to the Purchaser, the Company represents only that such projections were prepared in good faith and that the Company reasonably believes there is a reasonable basis for such projections. 4. Representations and Warranties of Purchasers and Restrictions on ---------------------------------------------------------------- Transfer Imposed by the Securities Act. - -------------------------------------- 4.1 Representations and Warranties by the Purchaser. Each Purchaser ----------------------------------------------- represents and warrants to the Company as of the date hereof and as of the Closing Date as follows: (a) Investment Intent. This Agreement is made with the ----------------- Purchasers in reliance upon their representation to the Company, evidenced by each Purchaser's execution of this Agreement, that each Purchaser is acquiring the Shares and Warrants, and will acquire the Warrant Shares issuable upon exercise of the Warrants and the Class A Common Stock issuable upon conversion of Shares (collectively the "Securities") for investment for such Purchaser's own account, not as nominee or agent, for investment and not with a view to, or for resale in connection with, any distribution or public offering thereof within the meaning of the Securities Act and the California Law. Each Purchaser has the full right, power and authority to enter into and perform this Agreement and the Collateral Agreements and this Agreement and each of the Collateral Agreements constitute valid and binding obligations upon it. (b) Shares Not Registered. Each Purchaser understands and --------------------- acknowledges that the offering of the Securities pursuant to this Agreement will not be registered under the Securities Act or qualified under the California Law on the grounds that the offering and sale of securities contemplated by this Agreement are exempt from registration under the Securities Act and exempt from qualification pursuant to Section 25102(f) of the California Law, and that the Company's reliance upon such exemptions is predicated upon such Purchaser's representations set forth in this Agreement. -8- (c) No Transfer. Each Purchaser covenants that in no event will ----------- such Purchaser dispose of any of the Securities (other than in conjunction with an effective registration statement for the Securities under the Securities Act or in compliance with Rule 144 promulgated under the Securities Act) unless and until (i) such Purchaser shall have notified the Company of the proposed disposition and shall have furnished the Company with a statement of the circumstances surrounding the proposed disposition, and (ii) if reasonably requested by the Company, such Purchaser shall have furnished the Company with an opinion of counsel satisfactory in form and substance to the Company to the effect that (x) such disposition will not require registration under the Securities Act and (y) appropriate action necessary for compliance with the Securities Act, the California Law and any other applicable state, local or foreign law has been taken. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144, other than opinions with regard to sales under Rule 144(k) as stated in Section 4.3 of this Agreement. (d) Permitted Transfers. Notwithstanding the provisions of ------------------- Subsection (c) above, no registration statement or opinion of counsel shall be necessary for a transfer by a Purchaser which is a partnership to a partner of such partnership or a former partner of such partnership who leaves such partnership after the date hereof, or to the estate of any such partner or former partner or the transfer by gift, will or intestate succession of any partner to his spouse or lineal descendants or ancestors, if the transferee agrees in writing to be bound by the terms of this Agreement to the same extent as if he were an original Purchaser hereunder. (e) Knowledge and Experience. Each Purchaser represents that it ------------------------ (i) has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of such Purchaser's prospective investment in the Securities; (ii) has the ability to bear the economic risks of such Purchaser's prospective investment; (iii) has been furnished with and has had access to such information as such Purchaser has considered necessary to make a determination as to the purchase of the Securities; (iv) has had all questions which have been asked by such Purchaser satisfactorily answered by the Company; and (v) has not been offered the Securities by any form of advertisement, article, notice or other communication published in any newspaper, magazine, or similar media or broadcast over television or radio, or any seminar or meeting whose attendees have been invited by any such media. (f) Accredited Investor. Each Purchaser is an "accredited ------------------- investor" within the meaning of Securities and Exchange Commission ("SEC") Rule 501 of Regulation D, as presently in effect. (g) Not Organized to Purchase. The Purchaser has not been ------------------------- organized for the purpose of purchasing the Securities. (h) Holding Requirements. Each Purchaser understands that if the -------------------- Company does not (i) register its Common Stock with the SEC pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), (ii) become subject to Section 15(d) of the Exchange Act, (iii) supply information pursuant to Rule 15c2-11 thereunder, or (iv) have a registration statement covering the Securities (or a filing pursuant to the exemption from registration under Regulation A of the Securities Act covering the Securities) under the -9- Securities Act in effect when it desires to sell the Securities, such Purchaser may be required to hold the Securities for an indeterminate period. Each Purchaser also understands that any sale of the Securities that might be made by such Purchaser in reliance upon Rule 144 under the Securities Act may be made only in limited amounts in accordance with the terms and conditions of that rule. 4.2 Legends. Each certificate representing the Securities may be ------- endorsed with the following legends: (a) Federal Legend. THE SECURITIES REPRESENTED BY THIS -------------- CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT OR (ii) IN COMPLIANCE WITH RULE 144, OR (iii) PURSUANT TO AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION. (b) Other Legends. Any other legends required by the Law or ------------- other applicable state blue sky laws. The Company need not register a transfer of legended Securities, and may also instruct its transfer agent not to register the transfer of the Securities, unless the conditions specified in each of the foregoing legends are satisfied. 4.3 Removal of Legend and Transfer Restrictions. Any legend endorsed ------------------------------------------- on a certificate pursuant to Subsection 4.2(a) and the stop transfer instructions with respect to such legended Securities shall be removed, and the Company shall issue a certificate without such legend to the holder of such Securities if such Securities are registered under the Securities Act and a prospectus meeting the requirements of Section 10 of the Securities Act is available or if such holder satisfies the requirements of Rule 144(k) and, where reasonably deemed necessary by the Company, provides the Company with an opinion of counsel for such holder of the Securities, reasonably satisfactory to the Company, to the effect that (i) such holder, meets the requirements of Rule 144(k) or (ii) a public sale, transfer or assignment of such Securities may be made without registration. 4.4 Rule 144. Each Purchaser is aware of the adoption of Rule 144 by -------- the SEC promulgated under the Securities Act, which permits limited public resales of securities acquired in a nonpublic offering, subject to the satisfaction of certain conditions. Each Purchaser understands that under Rule 144, the conditions include, among other things: the availability of certain current public information about the issuer and the resale occurring not less than two years after the party has purchased and paid for the securities to be sold. -10- 5. Conditions to Closing. --------------------- 5.1 Conditions to Purchasers' Obligations. The obligation of each ------------------------ Purchaser to purchase the Shares at the Closing is subject to the fulfillment to its satisfaction, on or prior to the Closing Date, of the following conditions, any of which may be waived in accordance with the provisions of Subsection 8.1 hereof: (a) Representations and Warranties Correct; Performance of ------------------------------------------------------ Obligations. The representations and warranties made by the Company in Section 3 - ----------- hereof shall be true and correct when made, and shall be true and correct in all material respects on the Closing Date with the same force and effect as if they had been made on and as of said date. The Company's business and assets shall not have been adversely affected in any material way prior to the Closing Date. The Company shall have performed in all material respects all obligations and conditions herein required to be performed or observed by it on or prior to the Closing Date. (b) Consents and Waivers. The Company shall have obtained in a -------------------- timely fashion any and all consents, permits and waivers necessary or appropriate for consummation of the transactions contemplated by this Agreement. (c) Amendment of Bylaws; Board of Directors. On or prior to the --------------------------------------- Closing Date the Company shall have amended its Bylaws to provide for a fixed Board of Directors set at four (4). Effective upon the Closing, Walter G. Kortschak shall have been appointed to the Company's Board of Directors. The Company and Walter G. Kortschak shall have entered into an indemnification agreement reasonably acceptable to special counsel to the Purchasers. The Compensation Committee of the Board of Directors shall consist, effective upon the Closing, of those persons described in Section 6.7 hereof. (d) Filing of the Restated Certificate; Effectiveness of Merger. ----------------------------------------------------------- The Restated Certificate shall have been filed with the Delaware Secretary of State, and the merger of Business Real Estate Information Corporation, a California corporation, with and into the Company, shall be effective in each of Delaware and California. (e) Investor Rights Agreement. The Company and each Purchaser ------------------------- shall have executed and delivered the Investor Rights Agreement in the form attached as Exhibit E hereto. --------- (f) Co-Sale Agreement. The Company, the Purchasers and the ----------------- Stockholders shall have executed and delivered the Co-Sale Agreement in the form attached as Exhibit G hereto. --------- (g) Shareholder Buy-Out and Voting Agreement. The Purchasers, ---------------------------------------- the Company, Christopher A. Crane and Robert C. Beasley shall have executed and delivered the Shareholder Buy-Out and Voting Agreement. (h) Compliance Certificate. The Company shall have delivered a ---------------------- Certificate, executed by the President of the Company, dated the Closing Date, certifying to the fulfillment of the conditions specified in Subsections (a), (b), (c) and (d) of this section 5.1. -11- (i) Opinion of Counsel. The Purchasers shall have received an ------------------ opinion from the Company's counsel, in substantially the form attached hereto as Exhibit J. - --------- (j) Employment Agreement. The Company shall have entered into an -------------------- Employment Agreement with Christopher A. Crane in a form reasonably acceptable to the Purchasers. 5.2 Conditions to Obligations of the Company. The Company's ---------------------------------------- obligation to sell and issue the Shares and Warrants at the Closing is subject to the fulfillment to the satisfaction of the Company on or prior to the Closing Date of the following conditions, any of which may be waived by the Company: (a) Representations and Warranties Correct. The representations -------------------------------------- and warranties made by each Purchaser in Section 4 hereof shall be true and correct when made, and shall be true and correct on the Closing Date with the same force and effect as if they had been made on and as of said date. (b) Conditions Fulfilled. The conditions set forth in -------------------- Subsections (b) and (d) of Section 5.1 shall have been fulfilled. 6. Covenants of the Company. The Company hereby covenants and agrees as ------------------------ follows: 6.1 Financial Information. Until the first to occur of (a) the date --------------------- on which the Company is required to file a report with the SEC pursuant to Section 13(a) of the Exchange Act, by reason of the Company having registered any of its securities pursuant to Section 12(g) of the Exchange Act or (b) quotations for the Common Stock of the Company are reported by the automated quotations system operated by the National Association of Securities Dealers, Inc. or by an equivalent quotations system or (c) shares of the Common Stock of the Company are listed on a national securities exchange registered under Section 6 of the Exchange Act, the Company will furnish to each Purchaser: (i) as soon as practicable after the end of each fiscal year, and in any event within 150 days thereafter, consolidated balance sheets of the Company and its subsidiaries, if any, as at the end of such fiscal year, and consolidated statements of operations and consolidated statements of cash flow of the Company and its subsidiaries, if any, for such year, prepared in accordance with generally accepted accounting principles, all in reasonable detail and certified by a "Big Six" accounting firm selected by the Board of Directors, and (ii) as soon as practicable after the end of each month, and in any event within 30 days thereafter, consolidated balance sheets of the Company and its subsidiaries, if any, as of the end of such month; and consolidated statements of income and consolidated cash flow statements, for such month and for the current fiscal year to date, prepared in accordance with generally accepted accounting principles (except for required footnotes), all in reasonable detail and signed, subject to changes resulting from year-end audit adjustments, by the principal financial officer or chief executive officer of the Company, and -12- (iii) as soon as practicable after its adoption or approval by the Company's Board of Directors, but not later than the commencement of such fiscal year, an annual budget and operating plan for each fiscal year which shall include monthly capital and operating expense budgets, cash flow statements, projected balance sheets and profit and loss projections for each such month and for the end of the year, itemized in such detail as the Board of Directors may reasonably determine. Each Purchaser agrees not to disclose the information provided it pursuant to this Section to any person, real or legal, except as provided or authorized herein. The Purchasers may disclose such information to persons who have a need to know, such as limited partners, directors, trustees, management employees, witnesses, experts, investors, attorneys, lenders, and insurers. Notwithstanding the foregoing, the Purchasers may disclose such information pursuant to the requirement of a governmental agency or operation of law, provided that the Purchasers are obligated to use reasonable efforts to prevent disclosure under such circumstance. 6.2 Conflicts of Interests. The Company shall use its best efforts to ---------------------- ensure that the Company's employees, during the term of their employment with the Company, do not engage in activities which would result in a conflict of interest with the Company. The Company's obligations hereunder include, but are not limited to, requiring that the Company's full-time employees devote their primary productive time, ability and attention to the business of the Company (provided, however, the Company's employees may engage in other professional activity if such activity does not materially interfere with their obligations to the Company), requiring that the Company's employees enter into agreements regarding proprietary information and confidentiality and preventing the Company's employees from engaging or participating in any business that is in competition with the business of the Company. 6.3 Key-Man and D&O Insurance. The Company shall use ts best efforts ------------------------- to obtain within thirty (30) days of the Closing and maintain in force, until canceled or modified with the written consent of Purchasers holding more than fifty percent (50%) of the Securities or their transferees, an insurance policy on the life of Christopher A. Crane, in the amount of $1,000,000, naming the Company as holder and beneficiary. The Company will use its best efforts to obtain Directors and Officers insurance provided that such insurance is available at a reasonable cost. 6.4 Proprietary Agreements. The Company will use its best efforts to ---------------------- prevent any employee from violating the confidentiality and proprietary information agreement entered into between the Company and each of its employees. 6.5 Future Stock Issuances. The Company will not issue any shares of ---------------------- Common Stock (or grant any options, warrants or other rights to purchase the same) to any employee, officer, director or consultant (i) except pursuant to written agreements which provide for vesting over a period of at least forty- eight (48) months (with the initial vesting date to occur at least after twelve (12) months) and a right of first refusal in favor of the Company in the event of any proposed transfer, or (ii) if such issuance or grant causes the aggregate number of shares of Common Stock issued and granted to the Company's employees, officers, directors or consultants to exceed 811,160; provided further that no ---------------- more than 341,159 shares of Common Stock (or options, warrants or other rights to purchase the same) may be granted to employees, -13- officers, directors or consultants of the Company who are employed, elected or retained by the Company as of the date of this Agreement, unless such issuance or grant is approved by the Purchasers holding a majority of the Shares. 6.6 Use of Proceeds. The Company may use up to $2,000,000 of the --------------- proceeds hereunder to repurchase shares of the Company's Common Stock held by existing shareholders of the Company. The remaining proceeds shall be used for working capital purposes. 6.7 Compensation Committee. The compensation for the Company's ---------------------- officers shall be determined by a Compensation Committee of the Board of Directors. The Compensation Committee shall initially consist of (a) Christopher A. Crane, Chairman (b) Walter G. Kortschak or such other director as is elected by the holders of the Shares, and (c) the director elected pursuant to the Voting Agreement attached hereto as Exhibit I. The director elected by the --------- holders of the Shares shall not be removed from the Compensation Committee without the prior written consent of the Purchasers. 6.8 Inspection Rights. Each Purchaser shall have the right to visit ----------------- and inspect any of the properties of the Company or any of its subsidiaries, and to discuss the affairs, finances and accounts of the Company or any of its subsidiaries with its officers, all at such reasonable times and as often as may be reasonably requested; provided, however, that the Company shall not be obligated under this Section 6.8 with respect to a competitor of the Company or with respect to information which the Board of Directors determines in good faith is confidential and should not, therefore, be disclosed. 6.9 Reservation of Common Stock. The Company will at all times --------------------------- reserve and keep available, solely for issuance and delivery upon the conversion of the Shares and exercise of the Warrants, all Class A and Class B Common Stock issuable from time to time upon such conversion or exercise. 6.10 Dealings with Affiliates and Others. The Company will not enter ----------------------------------- into any transaction, including, without limitation, any loans or extensions of credit or royalty agreements, with any officer or director of the Company or any subsidiary or holder of any class of capital stock of the Company, or any member of their respective immediate families or any corporation or other entity directly or indirectly controlled by one or more of such officers, directors or stockholders or members of their immediate families (other than any such transactions in the ordinary course of business which are in an amount not in excess of $25,000) unless such transaction is approved in advance by a majority of the members of the Board of Directors who are disinterested with respect to that transaction. 6.11 Termination of Covenants. All covenants of the Company contained ------------------------ in Section 6 of this Agreement shall expire and terminate as to each Purchaser after the time of effectiveness of the Company's first underwritten public offering registered under the Securities Act. -14- 7. Dispute Resolution. ------------------ 7.1 Arbitration. The parties acknowledge and agree that time is of ----------- the essence in resolving any dispute that may arise in connection with this Agreement. Except as set forth herein, any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be settled by binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"). The expenses of the arbitration, including the arbitrator's fees, expert witness fees. and attorney's fees, may be awarded to the prevailing party, in the discretion of the arbitrator, or may be apportioned between the parties in any manner deemed appropriate by the arbitrator. Unless and until the arbitrator decides that one party is to pay for all (or a share) of such expenses, the Company shall pay all reasonable expenses, including legal and accounting fees and costs arising in connection with enforcement of this Agreement or the Collateral Agreements. The parties shall keep confidential the decision of the arbitrator. Notwithstanding the foregoing, the parties may disclose information about such decision to persons who have a need to know, such as limited partners, directors, trustees, management employees, witnesses, experts, investors, attorneys, lenders, insurers, and others who may be affected. Additionally, if a party has stock which is publicly traded, the party may make such disclosures as are required by applicable securities laws. Once the arbitration award has become final, if the arbitration award is not promptly satisfied, then these confidentiality provisions shall no longer be applicable. 7.2 Specific Performance. Notwithstanding Section 7.1 hereof, the -------------------- parties will be entitled to enforce their rights under this Agreement specifically (without posting a bond or other security). The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and any party may in its sole discretion apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive relief in order to enforce or prevent any violation of the provisions of this Agreement. 8. Miscellaneous. ------------- 8.1 Waivers and Amendments. With the written consent of the Company ---------------------- and the record holders of at least a majority of the Shares, the obligations of the Company and Purchasers under this Agreement may be waived or amended (either generally or in a particular instance). Upon the effectuation of each such waiver or amendment, the Company shall promptly give written notice thereof to the record holders of the Shares who have not previously consented thereto in writing. Except to the extent provided in this Subsection 8.1, this Agreement or any provision hereof may be amended, waived, discharged or terminated only by a statement in writing signed by the party against which enforcement of the amendment, waiver, discharge or termination is sought. 8.2 Governing Law. This Agreement shall be governed in all respects ------------- by the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely within California. -15- 8.3 Survival. The representations, warranties, covenants and -------- agreements made herein shall survive the Closing, notwithstanding any investigation made by the Purchaser. All statements as to factual matters contained in any certificate or other instrument delivered by or on behalf of the Company pursuant hereto or in connection with the transactions contemplated hereby shall be deemed to be representations and warranties by the Company hereunder as of the date of such certificate or instrument. 8.4 Successors and Assigns. Except as otherwise expressly provided ---------------------- herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors and administrators of the parties hereto. 8.5 Entire Agreement. This Agreement and the Collateral Agreements ---------------- and other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof and they supersede, merge and render void every other prior written and/or oral understanding or agreement among or between the parties hereto. Notwithstanding the foregoing, the obligation set forth in the third sentence of Section X(B) of that certain Letter of Intent between the parses dated as of August 8, 1994, shall not be merged with this Agreement and shall survive until the Closing. 8.6 Notices, Etc. All notices and other communications required or ------------ permitted hereunder shall be in writing and shall be delivered personally, mailed by first class mail, postage prepaid, or delivered by courier or overnight delivery, addressed (a) if to a Purchaser, at such Purchaser's address set forth in the Schedule of Purchasers, or at such other address as such Purchaser shall have furnished to the Company in writing or (b) if to the Company, at its address set forth at the beginning of this Agreement, or at such other address as the Company shall have furnished to each Purchaser in writing. Notices that are mailed shall be deemed received five (5) days after deposit in the United States mail. 8.7 Severability. In case any provision of this Agreement shall be ------------ found by a court of law to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions of this Agreement shall not in any way be affected or impaired thereby. 8.8 Finder's Fees and Other Fees. ---------------------------- (a) The Company (i) represents and warrants that it has retained no finder or broker in connection with the transactions contemplated by this Agreement and, (ii) hereby agrees to indemnify and to hold Purchasers harmless from and against any liability for commission or compensate on in the nature of a finder's fee to any broker or other person or firm (and the costs and expenses of defending against such liability or asserted liability) for which the Company, or any of its employees or representatives, is responsible. (b) Each Purchaser (i) represents and warrants that it has retained no finder or broker in connection with the transactions contemplated by this Agreement and (ii) hereby agrees to indemnify and to hold the Company harmless from and against any liability for any commission or compensation in the nature of a finder's fee to any broker or other person or firm (and the costs and expenses of defending against such liability or asserted liability) for which Purchaser, or any of its employees or representatives, are responsible. -16- 8.9 Expenses. The Company and the Purchasers shall each bear their -------- own expenses and legal fees in connection with the consummation of this transaction; provided, however, that the Company will pay the reasonable fees of one special counsel for the Purchaser, together with disbursements and expenses incurred by special counsel in connection with all transactions leading up to and including the Closing. Upon and following the Closing, and subject to the provisions of Section 7 hereof, the Company shall pay all reasonable expenses, including legal and accounting fees and costs arising in connection with enforcement of this Agreement or the Collateral Agreements. 8.10 Titles and Subtitles. The titles of the sections and subsections -------------------- of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement. 8.11 Counterparts. This Agreement may be executed in any number of ------------ counterparts, each of which shall be an original, but all of which together shall constitute one instrument. 8.12 Delays or Omissions. No delay or omission to exercise any right, ------------------- power or remedy accruing to the Company or to any holder of any securities issued or to be issued hereunder shall impair any such right, power or remedy of the Company or such holder, nor shall it be construed to be a waiver of any breach or default under this Agreement, or an acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any delay or omission to exercise any right, power or remedy or any waiver of any single breach or default be deemed a waiver of any other right, power or remedy or breach or default theretofore or thereafter occurring. All remedies, either under this Agreement, or by law otherwise afforded to the Company or any holder, shall be cumulative and not alternative. 8.13 Publicity. The Company and each of the Purchasers agree that they --------- will not issue any press release or other public announcement regarding the execution of this Agreement and the closing of the transactions contemplated hereunder, without the prior written consent of the other parties to this Agreement. -17- IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above. COMPS INFOSYSTEMS, INC. By: /s/ Christopher A. Crane ----------------------------------------- Christopher A. Crane President SUMMIT VENTURES III, L.P. By: Summit Partners III, L.P. General Partner By: Stamps, Woodsum & Co. III, General Partner By: /s/ Walter Kortschak ------------------------------------ General Partner SUMMIT INVESTORS II, L.P. By: /s/ Walter Kortschak ---------------------------------------- General Partner STOCKHOLDERS: /s/ Christopher A. Crane -------------------------------------------- Christopher A. Crane /s/ Robert C. Beasley -------------------------------------------- Robert C. Beasley -18- Exhibit A --------- COMPS INFOSYSTEMS, INC. STOCK AND WARRANT PURCHASE AGREEMENT October __, 1994 Schedule of Purchasers ----------------------
Series A Warrants Purchase Price -------- -------- -------------- Summit Ventures III, L.P. 499 Hamilton Ave., Suite 200 Palo Alto, CA 94301 Attention: Walter Kortschak 4,184,929 372,272 $4,900,000 - ---------------------------- Summit Investors, II, L.P. 499 Hamilton Ave., Suite 200 Palo Alto, CA 94301 Attention: Walter Kortschak 85,407 7,597 $ 100,000 - ---------------------------- ---------- -------- ---------- Totals 4,270,336 379,869 $5,000,000
EXHIBIT B Warrant THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT OR (ii) IN COMPLIANCE WITH RULE 144, OR (iii) PURSUANT TO AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION. Warrant No. W-1 CLASS B COMMON STOCK WARRANT OF COMPS INFOSYSTEMS, INC. ----------------------- THIS CERTIFIES THAT, for value received, Summit Ventures III, L.P. (the "Holder") is entitled to subscribe for and to purchase from COMPS INFOSYSTEMS INC., a Delaware corporation (the "Company"), 372,272 shares of the non-voting Class B Common Stock of the Company, at the price per share set forth in Section 1 hereof, payable in cash or check (such price being referred to herein as the "Exercise Price" and subject to adjustment as set forth Section 2 below), at any time or from time to time following the occurrence of any of the events described in Section 3 hereof and during the term as set forth below. 1. Exercise Price. The Exercise Price shall be $.01 per share. -------------- 2. Adjustments for Subdivisions, Dividends, Combinations or -------------------------------------------------------- Consolidation of Common Stock. - ----------------------------- a. Subdivisions, Dividends, Consolidations. In the event (i) the --------------------------------------- outstanding shares of the Class B Common Stock shall be increased (by stock split, stock dividend or otherwise), into a greater number of shares of Class B Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such increase, be proportionately decreased; and (ii) the outstanding shares of Class B Common Stock shall be decreased, by reclassification or otherwise, into a lesser number of shares of Class B Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such decrease, be proportionately increased. In the event that the Exercise Price is adjusted pursuant to this Subsection, the number of shares of Class B Common Stock issuable pursuant to this Warrant shall be increased or decreased to a number determined by multiplying (1) the number of shares of Class B Common Stock issuable pursuant to this Warrant immediately prior to the adjustment by (2) a fraction, the numerator of which shall equal the Exercise Price in effect immediately -1- prior to the adjustment and the denominator of which shall equal the Exercise Price in effect immediately after the adjustment. b. Reclassification, Reorganization and Consolidation. In case of -------------------------------------------------- any reclassification, capital reorganization or change in the Class B Common Stock of the Company (other than as a result of a subdivision, combination or stock dividend provided for in Section 2(a) above), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the holder of this Warrant, so that the holder of this Warrant shall have the right, commencing upon the times set forth in Section 3, and prior to the expiration of this Warrant, to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization or change by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such reclassification, reorganization or change. In any such, case appropriate provisions shall be made with respect to the rights and interests of the holder of this Warrant so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per share payable hereunder, provided the aggregate purchase price shall remain the same. c. Conversion of Class B Common Stock. If at any time prior to the ---------------------------------- expiration of this Warrant, all of the Company's then outstanding Class B Common Stock is converted into shares of the Company's Class A Common Stock, then this Warrant shall immediately become exercisable for that number of shares of Class A Common Stock receivable upon conversion by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such conversion, and the Exercise Price shall be immediately adjusted to equal the quotient obtained by dividing (x) the aggregate Exercise Price of the maximum number of shares of Class B Common Stock for which this Warrant was exercisable immediately prior to such conversion, by (y) the number of shares of Class A Common Stock for which this Warrant is exercisable immediately after such conversion. After any such conversion, all references herein to Class B Common Stock shall be deemed to be references to Common Stock. d. Notice of Adjustment. When any adjustment is required to be made -------------------- in the number or kind of shares purchasable upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the number of shares of Common Stock or other securities or property thereafter purchasable upon exercise of the Warrant. 3. Exercise of Warrant. This Warrant may be exercised in whole or in ------------------- part, commencing (i) one day prior to the earlier of the closing or the effective time of a "Liquidity Event," as defined herein; or, (ii) if earlier, October 14, 2001, by the surrender of this Warrant and payment to the Company by cash or check of the Exercise Price for all of the Shares purchased. The Company shall, within ten (10) days after such delivery, (a) prepare and issue a certificate for the Shares purchased in the name of the Holder of this Warrant, or as such Holder may direct (subject to the restrictions upon transfer contained herein and upon payment by such -2- Holder hereof of any applicable transfer taxes) and (b) prepare and issue a new warrant of like terms if this Warrant is exercised for less than all of the Shares subject hereto. "Liquidity Event" shall mean (i) an acquisition, consolidation or merger of the Company with or into any other corporation or corporations unless the stockholders of the Company prior to such transaction directly or indirectly own more than fifty percent (50%) of the voting stock of the surviving or accruing corporation or corporations; (ii) the sale, transfer or other disposition of all or substantially all of the assets of the Company to a person other than a corporation or partnership controlled by the Company or its stockholders; (iii) the effectuation by the Company of a transaction or series of related transactions in which more than fifty percent (50%) of the outstanding voting power of the Company prior to such transaction or series of related transactions, is disposed of; and (iv) the closing of the sale of the Company's securities pursuant to an underwritten public offering. a. Net Issue Exercise. Notwithstanding any provisions herein to the ------------------ contrary, in lieu of exercising this Warrant for cash, the Holder may elect to receive shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company together with a properly endorsed notice of exercise and notice of such election in which event the Company shall issue to the Holder a number of shares of Clm B Common Stock computed using the following formula: Y (A - B) X = --------- A Where X = the number of shares of Class B Common Stock to be issued to the Holder, Y = the number of shares of Class B Common Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being canceled (at the date of such calculation), A = the fair market value of one share of the Company's Class A Common Stock (at the date of such calculation), and B = the Exercise Price (as adjusted to the date of such calculation). For purposes of the above calculation, fair market value of one share of Class A Common Stock shall be determined by the Company's Board of Directors in good faith; provided, however, that where there exists a public market for the Company's Class A Common Stock at the time of such exercise, fair market value shall mean the average over the preceding twenty (20) trading days (or such fewer number of days as such public market has existed) of the mean of the high closing bid and asked prices on the over-the-counter market as reported by Nasdaq, or if then traded on a national securities exchange or the Nasdaq National Market, the average over the preceding twenty (20) trading days (or such fewer number of days as the Class A Common Stock has been so traded) of the mean of the high and low prices on the principal national securities exchange or the National Market on which it is so traded. Notwithstanding the foregoing, in the event the Warrant is exercised in connection with the Company's initial -3- public offering of Common Stock, the fair market value per share shall be the per share offering price to the public of the Company's initial public offering. 4. Term of Warrant. This Warrant expires and shall no longer be --------------- exercisable as of 11:59 p.m. Pacific standard time, October 14, 2004, and shall be void thereafter. 5. Conditions to Exercise of Warrant or Transfer of the Shares. It ----------------------------------------------------------- shall be a condition to any exercise of this Warrant that the Company shall have received, at the time Shares being issued upon such exercise of such exercise, a representation in writing that the are being acquired for investment and not with a view to any sale or distribution thereof, or a statement of the pertinent facts covering any proposed distribution thereof. It shall be a condition to any transfer of any or all of the Shares issued upon exercise of this Warrant, other than a transfer registered under the Securities Act of 1933, as amended (the "Act"), that the Company shall have received a legal opinion, in form and substance reasonably satisfactory to the Company and its counsel, reciting the pertinent circumstances surrounding the proposed transfer and stating that such transfer is exempt from the prospectus and the registration requirement of the Act Each certificate evidencing the Shares issued upon exercise of this Warrant, or upon any transfer of such shares (other than a transfer registered under the Act or any subsequent transfer of shares so registered) shall, at the option of the Company, contains a legend, in form and substance satisfactory to the Company and its counsel, restricting the transfer of such shares to sales or other dispositions exempt from the requirements of the Act. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144, other than opinions with regard to sales under Rule 144(k). 6. Fractional Shares. This Warrant shall in no event be exercisable ----------------- for fractional shares, and in lieu thereof, the number of shares which would otherwise be purchased under this Warrant shall be rounded up to the nearest whole share of Common Stock. 7. Miscellaneous. ------------- a. The Company covenants that it will at all times reserve and keep available, solely for the purpose of issuance upon the exercise hereof, a sufficient number of shares of Class A or Class B Common Stock, as applicable, to permit the exercise hereof in full. Such shares when issued in compliance with the provisions of this Warrant and the Certificate of Incorporation, as amended, will be duly authorized, validly issued, fully paid and nonassessable. b. The terms of this Warrant shall be binding upon and shall inure to the benefit of any successors or assigns of the Holder hereof and of the Shares issued or issuable upon the exercise hereto. c. The Holder, as such, shall not be entitled to vote or receive dividends or be deemed to be a shareholder of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, is such, any rights of a shareholder of the Company or any right to vote, give or withhold consent to any corporate action, receive notice of meetings, receive dividends or subscription rights, or otherwise. d. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to the foregoing terms and conditions. -4- e. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction, upon delivery of an indemnity agreement reasonably satisfactory in form valid amount to the Company or, in the case of any such mutilation, upon surrender and cancellation of such Warrant, the Company at its expense will execute and deliver, in lieu thereof, a new Warrant of like date and tenor. f. This Warrant shall be governed by the internal laws of the State of California. IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized officer. Dated: October 14, 1994 COMPS INFOSYSTEMS, INC. By:_____________________________ Christopher A. Crane President -5- THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED ("THE ACT") AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT OR (ii) IN COMPLIANCE WITH RULE 144, OR (iii) PURSUANT TO AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION. Warrant No. W-2 CLASS B COMMON STOCK WARRANT OF COMPS INFOSYSTEMS, INC. ----------------------- THIS CERTIFIES THAT, for value received, Summit Investors II, L.P. (the "Holder") is entitled to subscribe for and to purchase from COMPS INFOSYSTEMS INC., a Delaware corporation (the "Company"), 7,597 shares of the non-voting Class B Common Stock of the Company, at the price per share set forth in Section 1 hereof, payable in cash or check (such price being referred to herein as the "Exercise Price" and subject to adjustment as set forth Section 2 below), at any time or from time to time following the occurrence of any of the events described in Section 3 hereof and during the term as set forth below. 1. Exercise Price. The Exercise Price shall be $.0l per share. -------------- 2. Adjustments for Subdivisions, Dividends, Combinations or -------------------------------------------------------- Consolidation of Common Stock. - ----------------------------- a. Subdivisions, Dividends, Consolidations. In the event (i) --------------------------------------- the outstanding shares of the Class B Common Stock shall be increased (by stock split, stock dividend or otherwise), into a greater number of shares of Class B Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such increase, be proportionately decreased; and (ii) the outstanding shares of Class B Common Stock shall be decreased, by reclassification or otherwise, into a lesser number of shares of Class B Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such decrease, be proportionately increased. In the event that the Exercise Price is adjusted pursuant to this Subsection, the number of shares of Class B Common Stock issuable pursuant to this Warrant shall be increased or decreased to a number determined by multiplying (1) the number of shares of Class B Common Stock issuable pursuant to this Warrant immediately prior to the adjustment -1- by (2) a fraction, the numerator of which shall equal the Exercise Price in effect immediately prior to the adjustment and the denominator of which shall equal the Exercise Price in effect immediately after the adjustment. b. Reclassification, Reorganization and Consolidation. In case of -------------------------------------------------- any reclassification, capital reorganization or change in the Class B Common Stock of the Company (other than as a result of a subdivision, combination or stock dividend provided for in Section 2(a) above), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the holder of this Warrant, so that the holder of this Warrant shall have the right, commencing upon the times set forth in Section 3, and prior to the expiration of this Warrant, to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization or change by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such reclassification, reorganization or change. In any such case appropriate provisions shall be made with respect to the rights and interests of the holder of this Warrant so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per share payable hereunder, provided the aggregate purchase price shall remain the same. c. Conversion of Class B Common Stock. If at any time prior to the ---------------------------------- expiration of this Warrant, all of the Company's then outstanding Class B Common Stock is converted into shares of the Company's Class A Common Stock, then this Warrant shall immediately become exercisable for that number of shares of Class A Common Stock receivable upon conversion by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such conversion, and the Exercise Price shall be immediately adjusted to equal the quotient obtained by dividing (x) the aggregate Exercise Price of the maximum number of shares of Class B Common Stock for which this Warrant was exercisable immediately prior to such conversion, by (y) the number of shares of Class A Common Stock for which this Warrant is exercisable immediately after such conversion. After any such conversion, all references herein to Class B Common Stock shall be deemed to be references to Common Stock. d. Notice of Adjustment. When any adjustment is required to be made -------------------- in the number or kind of shares purchasable upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the number of shares of Common Stock or other securities or property thereafter purchasable upon exercise of the Warrant. 3. Exercise of Warrant. This Warrant may be exercised in whole or in ------------------- part, commencing (i) one day prior to the earlier of the closing or the effective time of a "Liquidity Event," as defined herein; or, (ii) if earlier, October 14, 2001, by the surrender of this Warrant and payment to the Company by cash or check of the Exercise Price for all of the Shares purchased. The Company shall, within ten (10) days after such delivery, (a) prepare and issue a certificate for the Shares purchased in the name of the Holder of this Warrant, or as such Holder may direct (subject to the restrictions upon transfer contained herein and upon payment by such -2- Holder hereof of any applicable transfer taxes and (b) prepare and issue a new warrant of like terms if this Warrant is exercised for less than all of the Shares subject hereto. "Liquidity Event" shall mean (i) an acquisition, consolidation or merger of the Company with or into any other corporation or corporations unless the stockholders of the Company prior to such transaction directly or indirectly own more than fifty percent (50%) of the voting stock of the surviving or acquiring corporation or corporations; (ii) the sale, transfer or other disposition of all or substantially all of the assets of the Company to a person other than a corporation or partnership controlled by the Company or its stockholders; (iii) the effectuation by the Company of a transaction or series of related transactions in which more than fifty percent (50%) of the outstanding voting power of the Company prior to such transaction or series of related transactions, is disposed of; and (iv) the closing of the sale of the Company's securities pursuant to an underwritten public offering. a. Net Issue Exercise. Notwithstanding any provisions herein to the ------------------ contrary, in lieu of exercising this Warrant for cash, the Holder may elect to receive shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company together with a properly endorsed notice of exercise and notice of such election in which event the Company shall issue to the Holder a number of shares of Class B Common Stock computed using the following formula: Y (A - B) X = --------- A Where X = the number of shares of Class B Common Stock to be issued to the Holder, Y = the number of shares of Class B Common Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised , the portion of the Warrant being canceled (at the date of such calculation), A = the fair market value of one share of the Company's Class A Common Stock (at the date of such calculation), and B = the Exercise Price (as adjusted to the date of such calculation). For purposes of the above calculation, fair market value of one share of Class A Common Stock shall be determined by the Company's Board of Directors in good faith; provided, however, that where there exists a public market for the Company's Class A Common Stock at the time of such exercise, fair market value shall mean the average over the preceding twenty (20) trading days (or such fewer number of days as such public market has existed) of the mean of the high closing bid and asked prices on the over-the-counter market as reported by Nasdaq, or if then traded on a national securities exchange or the Nasdaq National Market, the average over the preceding twenty (20) trading days (or such fewer number of days as the Class A Common Stock has been so traded) of the mean of the high and low prices on the principal national securities exchange or the National Market on which it is so traded. Notwithstanding -3- the foregoing, in the event the Warrant is exercised in connection with the Company's initial public offering of Common Stock, the fair market value per share shall be the per share offering price to the public of the Company's initial public offering. 4. Term of Warrant. This Warrant expires and shall no longer be --------------- exercisable as of 11:59 p.m. Pacific standard time, October 14, 2004, and shall be void thereafter. 5. Conditions to Exercise of Warrant of Transfer of Shares. It ------------------------------------------------------- shall be a condition to any exercise of this Warrant that the Company shall have received, at the time of such exercise, a representation in writing that the Shares being issued upon such exercise are being acquired for investment and not with a view to any sale or distribution thereof, or a statement of the pertinent facts covering any proposed distribution thereof. It shall be a condition to any transfer of any or all of the Shares issued upon exercise of this Warrant, other than a transfer registered under the Securities Act of 1933, as amended (the "Act"), that the Company shall have received a legal opinion, in form and substance reasonably satisfactory to the Company and its counsel, reciting the pertinent circumstances surrounding the proposed transfer and stating that such transfer is exempt from the prospectus and the registration requirement of the Act. Each certificate evidencing the Shares issued upon exercise of this Warrant, or upon any transfer of such shares (other than a transfer registered under the Act or any subsequent transfer of shares so registered) shall, at the option of the Company, contain a legend, in form and substance satisfactory to the Company and its counsel, restricting the transfer of such shares to sales or other dispositions exempt from the requirements of the Act. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144, other dm opinions with regard to sales under Rule 144(k). 6. Fractional Shares. This Warrant shall in no event be exercisable ----------------- for fractional shares, and in lieu thereof, the number of shares which would otherwise be purchased under this Warrant shall be rounded up to the nearest whole share of Common Stock. 7. Miscellaneous. ------------- a. The Company covenants that it will at all times reserve and keep available, solely for the purpose of issuance upon the exercise hereof, a sufficient number of shares of Class A or Class B Common Stock, as applicable, to permit the exercise hereof in full. Such shares when issued in compliance with the provisions of this Warrant and the Certificate of Incorporation, as amended, win be duly authorized, validly issued, fully paid and nonassessable. b. The terms of this Warrant shall be binding upon and shall inure to the benefit of any successors or assigns of the Holder hereof and of the Shares issued or issuable upon the exercise hereto. c. The Holder, as such, shall not be entitled to vote or receive dividends or be deemed to be a shareholder of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, as such, any rights of a shareholder of the Company or any right to vote, give or withhold consent to any corporate action, receive notice of meetings, receive dividends or subscription rights, or otherwise. -4- d. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to the foregoing terms and conditions. e. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction, upon delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation, upon surrender and cancellation of such Warrant, the Company at its expense will execute and deliver, in lieu thereof, a new Warrant of like date and tenor. f. This Warrant shall be governed by the internal laws of the State of California. -5- IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized officer. Dated: October 14, 1994 COMPS INFOSYSTEMS, INC. By: __________________________________ Christopher A. Crane President -6- EXHIBIT C Schedule of Exceptions EXHIBIT C TO PURCHASE AGREEMENT ------------------------------- 3.1. Organization and Standing; Articles and Bylaws. The Company is ---------------------------------------------- intentionally not qualified to do business in Arizona, due to that state's policy of requiring and publishing full financial statements. Based on advice received from Arizona legal counsel, the Company believes that its failure to qualify in Arizona does not have a material adverse effect upon the Company. The Company intends to qualify the Delaware corporation to do business in such states as it deems necessary. 3.5 Authorization; Pre-emptive Right. Pursuant to the terms of a -------------------------------- Stockholder Buyout and Voting Agreement among Beasley, Crane and Summit, Crane and Summit have certain rights of first refusal with respect to Beasley's shares of Series A Common Stock. The Company has a right of first refusal with respect to shares of Common Stock issuable upon the exercise of options under the Company's Stock Option Plan. 3.6 Patents, Trademarks. ------------------- 3.6.1. Royalty Payments: The Company purchased a customer list ---------------- and database from a competitor (Pathways Commercial Data Services, Inc.) in September, 1993. Under the terms of the Purchase and Sale Agreement, the Company pays a 50% royalty on actual cash receipts from certain customers to the former owners of Pathways. The payments continue until September 30, 1997. 3.6.2 Infringement: The Company occasionally discovers minor ------------ infringement on its copyright (i.e.. persons photocopying reports). Confronting infringers generally has been successful in causing them to cease. The Company has not had to file any suits in this regard. 3.6.3 Trademark Protection. The Company has trademark -------------------- protection on the name "COMPS," but has not obtained such protection on its full corporate name, "COMPS InfoSystems, Inc." Post-Closing, the Company will investigate the feasibility of obtaining such protection on its corporate name. 3.8 Proprietary Agreements; Employees: A list of the employees that --------------------------------- have not executed non-disclosure/confidentiality agreements is attached hereto as Exhibit 3.8. 3.9 Litigation, etc. ---------------- 3.9.1 Crane is on the board of two publicly traded companies which have been sued in connection with a recent tender offer. Corporate counsel to such companies has indicated that the plaintiff's case has little merit. Board members are indemnified by the corporations, which have more than adequate net worth to adequately indemnify the directors. 3.6.2 The Company recently settled for a nominal amount litigation by an employee who was terminated. 3.6.3 The Company recently terminated a vice president who was employed less than 3 months and had been a consultant for 3 1/2 months prior to that time. The employee believes the Company should buy his business from him and has asked $150,000 for it. The Company has offered $50,000. The employee has not threatened litigation, and has specifically stated he wishes to avoid it. Negotiations are underway. The Company does not believe that this situation will have a material adverse effect. The Employee has recently expressed flexibility in arriving at a compromise in the near future. 3.6.3 A Company salesman has said he will request arbitration over a claim for approximately $12,000 in pay. While acknowledging the Company's right to change his compensation, the salesman claims he did not receive notice of an April, 1994 change in his compensation. Other Company employees have verified in writing that they delivered the new commission structure to the salesman. The Company does not believe that this situation will have a material adverse effect. 3.13. Title. Union Bank holds a first lien on all assets as a result ----- of the line of credit and term loan facility Union Bank has provided to the Company in the ordinary course of business. 3.15 Financial Statements. -------------------- 3.15.1 Beasley Loan. The Financial Statements reflect notes ------------ from stockholder Beasley of approximately $190,000. Such loans will be forgiven immediately after closing. 3.15.2. Beasley Non-Compete. Beasley will be paid $4,336 per ------------------- month in no-compete payments through May of 1996. 3.16 Absence of Changes ------------------ 3.16.1. Dividends, Redemptions. In June 1994, the Company ---------------------- declared a dividend of $7,000 which was paid in September, 1994. The Company has redeemed stock on a monthly basis from Beasley in exchange for payments of $5,800. Such redemption and payments will stop at closing. 3.16.2 Employees and Compensation. Summit and Crane have agreed -------------------------- on changed compensation for him after closing. Certain employment agreements with four vice presidents expired in July 1994. New employment agreements have been or will be executed by all officers. The Company will enter into indemnification agreements with each of its officers and directors. See attached Exhibit "H'. 3.16.3 Resignations, Terminations. The Company terminated a -------------------------- vice president in August, 1994 (see 3.6.3 above). In January, 1994, the Company terminated the position of Vice President -- Electronic Sales. 2 3.16.4 Loans to Employees, Officers, Directors. --------------------------------------- a. The Company has loaned $4,336 per month since May 1993 to Beasley (this amount is included in the $190,000 loan referenced in Section 3.15.1 above). b. In September, 1994 the Company loaned Beasley $79,294.04. The principal amount of such loans are due in October, 1994, and it is anticipated that Mr. Beasley will repay the Company with proceeds he receives when the Company repurchases certain of his shares shortly after the Closing. 3.16.5 Waiver of material debt. Following the closing the ----------------------- Company will forgive a loan to Beasley in the amount of approximately $190,000. See 3.15.1 above. 3.16.6 Payment of finder's Fee. Veronis Suhler and Associates ----------------------- has requested a $25,000 finder's fee in connection with the transaction, which the Company will pay upon the closing. No higher amount will be paid to Veronis Suhler without Summit's express permission. In addition, the Company paid consultant's fees to Steve James of approximately $18,000 ($150 per hour) for advice given in connection with the transaction. 3.19 Certain Transactions. -------------------- 3.19.1 Loans to Beasley. Beasley is indebted to the Company ---------------- for approximately $190,000, which amount will be forgiven following the closing. See 3.15.1 above. In addition, in September, 1994 the Company loaned Beasley $79,294. The principal amount of such loan is due in October, 1994, and it is anticipated that Mr. Beasley will repay the Company with proceeds he receives when the Company repurchases certain of his shares shortly after the Closing. See 3.16.4 above. 3.19.2 COMPS Plaza. Beasley has a 5 % interest and Crane has ----------- a 55 % ownership interest in COMPS Plaza Associates, L.P., which owns the building in which the Company leases space. Crane is the President of Alden Properties, Inc., the corporate general partner of COMPS Plaza Associates, L.P. The limited partnership purchased the building on September 16, 1994. Neither the Company nor Beasley nor Crane are guarantors on the debt on the building. 3.24 Disclosure; Projections. This representation does not apply to ----------------------- any post-1995 projections delivered to Purchaser. 3.25 Other. With Summit's consent, (i) Steve James will be appointed ----- to the Board as of the Closing as "Crane's designated director," (ii) Walter Kortschak will be appointed to the Board as of the Closing as "Summit's designated director," and (iii) the fourth Board member, (the "Mutual Director") will be appointed to the Board of Directors post-closing. The Compensation Committee will be comprised of Crane, Kortschak and, when appointed, the Mutual Director. 3 "Exhibit 3.8" Following is a list of current employees without signed Non-Disclosure, -------------- Confidentiality Agreements on file. Adams, Ross Alling, Robert Aspiras, Gloria August, Caroline Becker, Aaron Clarkson, Heather Cole, Terry DeMonsco, Tracy Donado, Cresenciana Euler, Paul Fernandez, Michael Gertos, Michelle Hitch, Jeffrey Huys, Kathryn Mannina, Joseph Meile, Craig Nelson, Lora Panganiban, Mark Pierce, Jeffrey Pittman, Matthew Provo, Daniel Quindara, Belinda Radovich, Marcella Reisinger, Lori Ruiz, Rance Ryan, Spencer Schroeder, Karen Signer, Debra Stevens, Mark Strong, Elizabeth Umali, Charlie Wilson, Diana Yee, David 10/5/94 EXHIBIT D Investor Rights Agreement INVESTOR RIGHTS AGREEMENT ------------------------- THIS INVESTOR RIGHTS AGREEMENT is made and entered into as of October 14, 1994 by and among COMPS Infosystems, Inc., a Delaware corporation (the "Company") and the undersigned purchasers (the "Purchasers") of the Company's Series A Preferred Stock and Class B Common Stock Warrants (the "Purchased Securities'), and Christopher A. Crane and Robert C. Beasley (the "Founders"). RECITALS: -------- WHEREAS, as a condition to purchasing the Purchased Securities, the Purchasers have requested that the Company extend to them registration rights, a right of first refusal, repurchase rights and certain other rights as set forth below. NOW, THEREFORE, in consideration of the mutual promises, representations, warranties, covenants and conditions set forth in this Agreement and in the Stock and Warrant Purchase Agreement of even date herewith among the Company and the Purchasers (the "Purchase Agreement"), the parties mutually agree as follows: I GENERAL A. Definitions. As used herein: ----------- 1. The terms "register", "registered" and "registration" refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act of 1933, as amended (the "Securities Act"), and the declaration or ordering of the effectiveness of such registration statement. 2. For the purposes hereof, the term "Registrable Securities" means shares of (i) any and all Common Stock of the Company issued or issuable upon conversion of shares of the Series A Preferred Stock of the Company and any and all Common Stock issued as of or upon the date hereof to the Purchasers; (ii) any and all Common Stock issued or issuable upon exercise of Class B Common Stock Warrants issued to the Purchasers as of the date hereof; (iii) any and all Common Stock issued or issuable upon exercise of the Director options (as defined in subsection 6. below); (iv) stock issued with respect to or in any exchange for or in replacement of stock included in subparagraph (i), (ii), or (iii) above; (iv) stock issued in respect of the stock referred to in (i), (ii), (iii) and (iv) above as a result of a stock split, stock dividend, recapitalization or similar event or the like. 3. The terms "Holder" or "Holders" mean any person or persons to whom Registrable Securities were originally issued and who execute this Agreement or qualifying transferees under Section II(J) hereof who hold Registrable Securities. 4. The term "Initiating Holders" means any Holder or Holders of not less than 50% of the aggregate of Registrable Securities. -1- 5. The term "Form S-3" means such form under the Securities Act as in effect on the date hereof or any successor registration form under the Securities Act subsequently adopted by the SEC which permits inclusion or incorporation of substantial information by reference to other documents filed by the Company with the SEC. 6. The term "Securities" shall mean the Company's Series A Preferred Stock, Class B Common Stock Warrants, any options to purchase shares of the Company's equity securities issued to Walter G. Kortschak (or his successor as representative of the Purchasers) in his role as outside director ("Director Options"), and the Class A Common Stock issuable upon conversion of the Series A Preferred Stock, the Class B Common Stock issuable upon exercise of the Class B Common Stock Warrants, the Class A Common Stock issuable upon conversion of the Class B Common Stock and any equity securities issuable upon exercise of the Director Options. 7. The term "Securities Act" shall mean the Securities Act of 1933, as amended. 8. The term "SEC" or "Commission" means the Securities and Exchange Commission. II REGISTRATION A. Demand Registration. ------------------- 1. Request for Registration. In case the Company shall receive from ------------------------ the Initiating Holders a written request that the Company effect any registration with respect to all or part of the Registrable Securities, the Company will: a. within ten (10) days after its receipt thereof give written notice of the proposed registration to all other Holders; and b. as soon as practicable, use its best efforts to effect such registration (including, without limitation, the execution of an undertaking to file post-effective amendments, appropriate qualifications under the applicable blue sky or other state securities laws and appropriate compliance with exemptive regulations issued under the Securities Act and any other governmental requirements or regulations) as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Holder's or Holders' Registrable Securities as are specified in such request, together with all or such portion of the Registrable Securities of any Holder or Holders joining in such request as are specified in a written request given within 20 days after receipt of such written notice from the Company; provided, that the Company shall not be obligated to take any action to effect such registration pursuant to this Section II(A)(1): i. Prior to 180 days following the effective date of the Company's first registered offering to the general public of its securities for its own account; or -2- ii. In any particular jurisdiction in which the Company would be required to qualify to do business or execute a general consent to service of process in effecting such registration; or iii. After the Company has effected two (2) such registrations pursuant to this Subsection II(A)(1) and such registrations have been declared or ordered effective; or iv. If the Company qualifies to register the Registrable Securities pursuant to Form S-3. Subject to the foregoing clauses (i) through (iv), the Company shall file a registration statement covering the Registrable Securities so requested to be registered as soon as practical, but in any event within ninety (90) days after receipt of the request or requests of the Initiating Holders; provided, however, that if the Company shall furnish to such Holders a certificate signed by the President or Chief Executive Officer of the Company stating that in the reasonable judgment of the Board of Directors it would be seriously detrimental to the Company and its shareholders for such registration statement to be filed at the date filing would be required and it is therefore essential to defer the filing of such registration statement, the Company shall be entitled to delay the filing of such registration statement not more than once in any twelve month period for an additional period of up to sixty (60) days. 2. Underwriting. If the Initiating Holders intend to distribute the ------------ Registrable Securities covered by their request by means of an underwriting, they shall so advise the Company as a part of their request made pursuant to Section II(A)(1) and the Company shall include such information in the written notice referred to in Subsection II(A)(1)(a). The right of any Holder to registration pursuant to Section II(A)(1) shall be conditioned upon such Holder's participation in such underwriting and the inclusion of such Holder's Registrable Securities in the underwriting (unless otherwise mutually agreed by a majority in interest of the Initiating Holders and such Holder) to the extent provided herein. The Company shall (together with all Holders proposing to distribute their securities through such underwriting) enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by a majority in interest of the Initiating Holders. Notwithstanding any other provision of this Section 2, if the underwriter advises the Initiating Holders in writing that marketing factors require a limitation of the number of shares to be underwritten, the Initiating Holders shall so advise all Holders of Registrable Securities who have elected to participate in such offering, and the number of shares of Registrable Securities that may be included in the registration and underwriting shall be allocated among all such Holders thereof in proportion, as nearly as practicable, to the respective amounts of Registrable Securities held by such Holders. If any Holder of Registrable Securities disapproves of the terms of the underwriting, he may elect to withdraw therefrom by written notice to the Company, the underwriter and the Initiating Holders. Any Registrable Securities which are excluded from the underwriting by reason of the underwriter's marketing limitation or withdrawn from such underwriting shall be withdrawn from such registration. If the underwriter has not limited the number of Registrable Securities to be underwritten, the Company, employees of the Company and other holders of the Company's Common Stock may include securities for its (or their) own account in such registration if the -3- underwriter so agrees and if the number of Registrable Securities which would otherwise have been included in such registration and underwriting will not thereby be limited. B. Company Registration. -------------------- 1. Registration. If at any time or from time to time, the Company ------------ shall determine to register any of its securities, for its own account or the account of any of its stockholders, other than a registration on Form S-8 relating solely to employee stock option or purchase plans, or a registration on Form S-4 relating solely to an SEC Rule 145 transaction, or a registration on any other form (other than Form S-1, S-2 or S-3 or SB-2, or their successor forms), or any successor to such form which does not include substantially the same information as would be required to be included in a registration statement covering the sale of Registrable Securities, the Company will: a. promptly give to each Holder written notice thereof; and b. include in such registration (and any related qualification under blue sky laws or other compliance with applicable taws), and in any underwriting involved therein, all the Registrable Securities specified in a written request or requests, made within 70 days after receipt of such written notice from the Company, by any Holder or Holders to be included in any such registration, except as set forth in Subsection II(B)(2) below. 2. Underwriting. If the registration of which the Company gives ------------ notice is for a registered public offering involving an underwriting, the Company shall so advise the Holders as a part of the written notice given pursuant to Subsection II(B)(1)(a). In such event the right of any Holder to registration pursuant to Section II(B) shall be conditioned upon such Holder's participation in such underwriting and the inclusion of such Holder's Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their securities through such underwriting shall (together with the Company and the other holders distributing their securities through such underwriting) enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by the Company. Notwithstanding any other provision of this Section II(B), if the underwriter determines that marketing factors require a limitation of the number of shares to be underwritten, the underwriter may limit the number of Registrable Securities to be included in the registration and underwriting. Notwithstanding the foregoing, in no event shall the amount of securities of the selling Holders included in the offering be reduced below thirty percent (30%) of the total amount of the securities included in such offering, unless such offering is the initial public offering of the Company's securities, in which case the selling Holders may be excluded if the underwriters make the determination described above and no other shareholders' securities are included. In the event of a cutback by the underwriters of the number of Registrable Securities to be included in the registration and underwriting, the Company shall advise all Holders of Registrable Securities which would otherwise be registered and underwritten pursuant hereto, and the number of shares of Registrable Securities that may be included in the registration and underwriting shall be allocated among all of such Holders in proportion, as nearly as practicable, to the respective amounts of Registrable Securities held by such Holders. If any Holder disapproves of the terms of any such underwriting, he may elect to withdraw therefrom by -4- written notice to the Company and the underwriter. Any Registrable Securities excluded or withdrawn from such underwriting shall be withdrawn from such registration. C. Form S-3. After the Company has qualified for the use of Form S-3, or -------- its successor form, Holders of at least ten percent (10%) of the outstanding Registrable Securities shall have the right to request an unlimited number of registrations on Form S-3 (such requests shall be in writing and shall state the number of shares of Registrable Securities to be disposed of and the intended method of disposition of shares by such Holders), subject only to the following: 1. The Company shall not be required to effect a registration pursuant to this Section II(C) within 180 days of the effective date of any registration referred to in Sections II(A) or II(B) above. 2. The Company shall not be required to effect more than one such registration in any consecutive 6-month period. 3. The Company shall not be required to effect a registration unless the anticipated aggregate gross proceeds from the requested registration will equal or exceed one hundred thousand dollars ($100,000). The Company shall promptly give written notice to all Holders of Registrable Securities of the receipt of a request for registration pursuant to this Section II(C) and shall provide a reasonable opportunity for other Holders to participate in the registration, provided that if the registration is for an underwritten offering, the terms of Subsection II(A)(2) shall apply to all participants in such offering. Subject to the foregoing, the Company will use its best efforts to effect promptly the registration of all shares of Registrable Securities on Form S-3 to the extent requested by the Holder or Holders thereof for purposes of disposition; provided, however, that if the Company shall furnish to such Holders a certificate signed by the President or Chief Executive Officer of the Company stating that in the good faith judgement of the Board of Directors it would be seriously detrimental to the Company for such registration statement to be filed at the date filing would be required and it is therefore essential to defer the filing of such registration statement, the Company shall be entitled to delay the filing of such registration statement not more than once in any 12 month period for an additional period of up to sixty (60) days. Any registration pursuant to this Section II(C) shall not be counted as a registration pursuant to Section II(A). D. Expenses of Registration. All expenses incurred in connection with any ------------------------ registration, qualification or compliance pursuant to this Agreement, including without limitation, all registration, filing and qualification fees, printing expenses, fees and disbursements of counsel for the Company and expenses of any special audits incidental to or required by such registration, shall be borne by the Company except as follows: 1. The Company shall not be required to pay for expenses of any registration proceeding begun pursuant to Sections II(A) or II(C), the request for which has been subsequently withdrawn by the Initiating Holders, in which case, such expenses shall be borne by the Holders requesting such withdrawal; provided, however, that in lieu of paying such expenses a majority in interest of the Initiating Holders may elect to forfeit the right of the -5- holders of Registrable Securities to request one registration pursuant to Section II(A) or II(C). Notwithstanding the foregoing, if at the time of such withdrawal (i) the Holder has learned of a material adverse change in the condition, business or prospects of the Company from that known to the Holder at the time of its request, and (ii) the Company knew or had reason to know of the likelihood of such material adverse change at the time of its request and did not inform the Holder thereof, then the Company shall be required to pay such expenses and the Holder shall retain its rights pursuant to Section II(A) or II(C). 2. The Company shall not be required to pay reasonable fees of legal counsel of a Holder except for a single counsel acting on behalf of all selling Holders. 3. The Company shall not be required to pay underwriters' fees, discounts or commissions relating to the Registrable Securities. E. Registration Procedures. In the case of each registration, ----------------------- qualification or compliance effected by the Company pursuant to this Agreement, the Company will keep each Holder participating therein advised in writing as to the initiation of each registration, qualification and compliance and as to the completion thereof. At its expense the Company will: 1. Prepare and file with the SEC a registration statement with respect to such Registrable Securities and use its best efforts to cause such registration statement to become effective, and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective for up to one hundred twenty (120) days. 2. Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement. 3. Furnish to the Holders such numbers of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as they may reasonably request in order to facilitate the disposition of Registrable Securities owned by them. 4. Use its best efforts to register and qualify the securities covered by such registration statement under such other securities or Blue Sky laws of such jurisdictions as shall be reasonably requested by the Holders, provided that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process in any such states or jurisdictions. 5. In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter of such offering. Each Holder participating in such underwriting shall also enter into and use best efforts to perform its obligations under such an agreement. 6. Notify each Holder of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the -6- Securities Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing. 7. Furnish, at the request of any Holder, on the date that the securities are delivered to the underwriters for sale in connection with a registration being sold through underwriters, (i) an opinion, if any, dated such date, of the counsel representing the Company for the purposes of such registration, in form and substance as is customarily given to the underwriters in an underwritten public offering, addressed to the underwriters and to the Holders and (ii) a letter dated such date, from the independent certified public accountants of the Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering, addressed to the underwriters, if any, and to the Holders requesting of Registrable Securities. F. Indemnification. --------------- 1. The Company will indemnify and hold harmless each Holder of Registrable Securities, each of its officers, directors and partners, and each person controlling such Holder within the meaning of Section 15 of the Securities Act, with respect to which such registration, qualification or compliance has been effected pursuant to this Agreement, and each underwriter, if any, and each person who controls any underwriter of the Registrable Securities held by or issuable to such Holder, against all claims, losses, expenses, damages and liabilities (or actions in respect thereto) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any registration statement, preliminary or final prospectus, or any amendment or supplement thereto, offering circular or other document (including any related registration statement, notification or the like) incident to any such registration, qualification or compliance, or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or any violation or alleged violation by the Company relating to action or inaction required of the Company in connection with any rule or regulation promulgated under the Securities Act or any state securities law applicable to the Company and will reimburse each such Holder within the meaning of Section 15 of the Securities Act, each of its officers, directors and partners, and each person controlling such Holder, each such underwriter and each person who controls any such underwriter, for any reasonable legal and any other expenses, as incurred, in connection with investigating, defending or settling any such claim, loss, damage, liability or action; provided, however, that the Company will not be liable in any such case to the extent that any such claim, loss, damage or liability arises out of or is based on any untrue statement or omission based upon written information furnished to the Company in an instrument duly executed by such Holder or underwriter specifically for use therein, and provided further that the agreement of the Company to indemnify any underwriter and any person who controls such underwriter contained herein with respect to any such preliminary prospectus shall not inure to the benefit of any underwriter, from whom the person asserting any such claim, loss, damage, liability or action purchased the stock which is the subject thereof, if at or prior to the written confirmation of the sale of such stock, a copy of the prospectus (or the prospectus as amended or supplemented) was not sent or delivered to such person, excluding the documents incorporated therein by reference, and the untrue statement or omission of a material fact contained in such -7- preliminary prospectus was corrected in the prospectus (or the prospectus as amended or supplemented). 2. Each Holder will, if Registrable Securities held by or issuable to such Holder are included in the securities as to which such registration, qualification or compliance is being effected, indemnify and hold harmless the Company, each of its directors and officers, each underwriter, if any, of the Company's securities covered by such a registration statement, each person who controls the Company within the meaning of the Securities Act, and each other such Holder, each of its officers, directors and partners and each person controlling such Holder, against all claims, losses, expenses, damages and liabilities (or actions in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any preliminary or final prospectus, offering circular or other document (including any related registration statement, notification or the like) incident to any such registration, qualification or compliance or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse the Company, such Holders, such directors, officers, partners, persons or underwriters for any reasonable legal or any other expenses incurred in connection with investigating, defending or settling any such claim, loss, damage, liability or action, in each case to the extent, but only to the extent, that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such registration statement, prospectus, offering circular or other document in reliance upon and in conformity with written information furnished to the Company in an instrument duly executed by such Holder specifically for use therein, and provided further that the agreement of the Holder to indemnify any underwriter and any person who controls such underwriter contained herein with respect to any such preliminary prospectus shall not inure to the benefit of any underwriter, from whom the person asserting any such claim, loss, damage, liability or action purchased the stock which is the subject thereof, if at or prior to the written confirmation of the sale of such stock, a copy of the prospectus (or the prospectus as amended or supplemented) was not sent or delivered to such person, excluding the documents incorporated therein by reference, and the untrue statement or omission of a material fact contained in such preliminary prospectus was corrected in the prospectus (or the prospectus as amended or supplemented). Notwithstanding the foregoing, in no event shall the indemnification provided by any Holder hereunder exceed the gross proceeds received by such Holder for the sale of such Holder's securities pursuant to such registration. 3. Each party entitled to indemnification under this Section II(F) (the "Indemnified Party") shall give notice to the party required to provide indemnification (the "Indemnifying party") promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought. The Indemnified Party shall promptly permit the Indemnifying Party to assume the defense of any such claim or any litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or litigation, shall be approved by the Indemnified Party (whose approval shall not be unreasonably be withheld). The Indemnified Party may participate in such defense and hire counsel at such party's own expense. The failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations hereunder, unless such failure is materially prejudicial to an Indemnifying Party's ability to defend such action. No Indemnifying Party, in the defense of any such claim or litigation, shall, except with the consent of the Indemnified Party, consent to entry of any judgment or enter into any settlement which does not -8- include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation. Any Indemnified Party shall cooperate with the Indemnifying Party in the defense of any claim or litigation brought against such Indemnified Party. G. Lock-Up Provision. Upon receipt of a written request by the Company or ----------------- by its underwriters, the Holders shall not sell, sell short, grant an option to buy, or otherwise dispose of shares of the Company's Common Stock or other securities (except for any such shares included in the registration) for a period of one hundred and eighty (180) days following the effective date of the initial registration of the Company's securities; provided, however, that such Holder shall have no obligation to enter into the agreement described in this Section II(G) unless all executive officers, directors and holders of three percent (3%) or more of the outstanding voting securities of the Company and all other Holders and holders of other registration rights from the Company enter into similar agreements. The Company may impose stop-transfer instructions with respect to the shares (or securities) subject to the foregoing restriction until the end of said 120-day period. H. Information by Holder. The Holder or Holders of Registrable Securities --------------------- included in any registration shall promptly furnish to the Company such information regarding such Holder or Holders and the distribution proposed by such Holder or Holders as the Company may request in writing and as shall be required in connection with any registration, qualification or compliance referred to herein. I. Rule 144 Reporting. With a view to making available to Holders of ------------------ Registrable Securities the benefits of certain rules and regulations of the SEC which may permit the sale of the Registrable Securities to the public without registration, at all times after 90 days after the effective date of the first registration filed by the Company for an offering of its securities to the general public the Company agrees to: 1. Make and keep public information available, as those terms are understood and defined in SEC Rule 144. 2. File with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Securities Exchange Act of 1934, as amended (the "Exchange Act"). 3. So long as a Holder owns any Registrable Securities, to furnish to such Holder forthwith upon such Holder's request a written statement by the Company as to its compliance with the reporting requirements of said Rule 144 (at any time after 90 days after the effective date of the first registration statement filed by the Company for an offering of its securities to the public) and of the Securities Act and the Exchange Act (at any time after it has become subject to such reporting requirements), a copy of the most recent annual or quarterly report of the Company, and such other reports and documents so filed by the Company as such Holder may reasonably request in availing itself of any rule or regulation of the SEC allowing such Holder to sell any such securities without registration. -9- J. Transfer of Registration Rights. A Holder's rights under Sections ------------------------------- II(A), II(B), II(C) and II(l) may be assigned by any Holder to a transferee or assignee of at least 10% of a Holder's Registrable Securities (as adjusted for stock splits, stock dividends. recapitalizations and the like) not sold to the public or a transferee or assignee of any shares of its Registrable Securities not sold to the public that is a partner or affiliate of such Holder, provided, that the Company is given written notice by the Holder at the time of or within thirty (30) days after said transfer, stating the name and address of said transferee or assignee and identifying the securities with respect to which such registration rights are being assigned. No such transfer or assignment shall be effective until such transferee or assignee agrees in writing to become subject to the obligations of the transferring Holder hereunder. K. Limitations on Subsequent Registration Rights. From and after the date --------------------------------------------- of this Agreement, the Company shall not, without the prior written consent of the Holders of a majority of the outstanding Registrable Securities, enter into any agreement with any holder or prospective holder of any securities of the Company which would allow such holder or prospective holder (a) to include such securities in any registration filed under Section II(A), II(B) or II(C) hereof, unless under the terms of such agreement, such holder or prospective holder may include such securities in any such registration only to the extent that the inclusion of its securities will not reduce the number of amount of the Registrable Securities of the Holders which are included or (b) to make a demand registration which could result in such registration statement being declared effective prior to the earlier of either of the dates set forth in Subsection II(A)(1)(b)(i). L. Termination. The rights of all Holders under this Agreement shall ----------- terminate on the fifth anniversary of the closing of the Company's first registered public offering of its securities; provided however, that the -------- Company's reporting obligations under SEC Rule 144 as set forth in Section 10 above, shall survive the termination of this Agreement. III RIGHT OF FIRST REFUSAL If, at any time prior to the expiration of the period set forth in Section IV(B) below, the Company should desire to issue in any transaction not registered under the Securities Act in reliance upon a claimed exemption thereunder, any Equity Securities (as defined in Subsection (E) below), it shall give each Purchaser and each Founder (together, the Purchasers and Founders shall be referred to in this Section III as "Stockholders") a first right of refusal to purchase such Stockholder's pro rata share (or any part thereof) of all of such privately offered Equity Securities on the same terms as the Company is willing to sell such Equity Securities to any other person. The Stockholder's pro rata share of the Equity Securities shall be equal to the percentage that the Equity Securities of the Company held by the Stockholder on an as-converted basis on the date of the Company's written notification referred to in subparagraph (A) below, bears to all outstanding Equity Securities of the Company on the date of such written notification. A. Notices. Prior to any sale or issuance by the Company of any Equity ------- Securities, the Company shall notify each Stockholder, in writing, of its bona fide intention to sell and issue such Equity Securities, setting forth any material terms under which it proposes to make such sale. Within fifteen (15) days after receipt of such notice, each Stockholder shall notify the -10- Company whether the Stockholder exercises its option and elects to purchase the Stockholder's pro rata share (or any part hereof) of the Equity Securities so offered. B. Procedure. If any Stockholder has failed to exercise its option to --------- purchase all of its pro rata portion of the Equity Securities upon the terms and conditions set forth in the Subsection (A) notice, the Company may, during the period of ninety (90) days following the expiration of such option period, sell and issue such securities as to which such Stockholder has not exercised its option to any other person upon the same terms and conditions as those set forth in the notice to the Stockholders. In the event the Company has not sold the Equity Securities within said ninety (90) day period, the Company shall not thereafter issue or sell any Equity Securities without first offering such securities to the Stockholders in the manner provided above. C. Closing. If a Stockholder gives the Company notice that it desires to ------- purchase any of the Equity Securities offered by the Company, payment for the Equity Securities shall be by check, or wire transfer, against delivery of the securities at the executive offices of the Company within ten (10) days after giving the Company such notice, or, if later, the closing date for the sale of such Equity Securities to third parties. The Company shall take all such action as may be required by any regulatory authority in connection with the exercise by the Stockholder of the right to purchase Equity Securities as set forth in this Section III. D. Exceptions. The right of first refusal contained in this Section III ---------- shall not apply to (i) the issuance by the Company of Equity Securities exclusively to employees or directors of, or consultants to the Company pursuant to the approval of the Board of Directors, (ii) the issuance of Common Stock of the Company upon conversion of Preferred Stock, (iii) the issuance of Class A Common Stock upon conversion of Class B Common Stock, or (iv) any Equity Securities issued in connection with an acquisition or SEC Rule 145 transaction. E. "Equity Securities". The term "Equity Securities" shall mean (i) ----------------- Common Stock, rights, options or warrants to purchase Common Stock; (ii) any other instrument convertible into Common Stock; (iii) any security convertible into or exchangeable for any of the foregoing. F. Assignment. A Purchaser's right to purchase any Equity Securities ---------- pursuant to this Section III may be assigned by the Purchaser to an affiliate of the Purchaser. For the purposes of this subparagraph (F), an "affiliate" shall mean any partner or shareholder of the Purchaser, any person or entity that director or indirectly through one or more intermediaries controls or is controlled by or is under common control with a Purchaser. A Founder's right to purchase any Equity Securities pursuant to this Section III shall not be assignable. IV REPURCHASE A. Put Option. ---------- 1. Exercise of Option. In the event that upon the earlier to occur ------------------ of (i) October 14, 2001, (ii) a liquidation, dissolution, winding-up or (iii) the closing of an acquisition, merger. exchange of securities, sale of all or substantially all of the assets of Company, reorganization in which the Company is not the surviving entity or a stock issuance or "reverse merger" in which the Company is the surviving entity but under which the holders of the -11- Company's securities prior to such stock issuance or reverse merger do not hold more than fifty percent (50%) of the voting securities of the Company following such stock issuance or reverse merger, the Purchasers continue to hold any Securities, any Purchaser may notify the Company that it intends to offer to the Company any or all of the Securities then held by it for purchase by the Company, and the Company shall be required to repurchase the Securities so offered under this Agreement as provided below. 2. Price. The price to be paid by the Company for the Securities to ----- be sold hereunder shall be the greater of (i) the Purchaser's original purchase price of such Securities (as set forth in the Purchase Agreement) plus all accrued and unpaid dividends through the date of the repurchase, and (ii) the fair market value of the Securities as of the date of such proposed repurchase as agreed upon by the Company and the Purchaser. If the Common Stock is publicly traded, fair market value, with respect to the Common Stock, shall mean the average over the preceding twenty (20) trading days of the mean of the closing bid and asked prices on the over-the-counter market as reported by Nasdaq, or if then traded on a national securities exchange or the Nasdaq National Market, the average over the preceding twenty (20) trading days of the mean of the high and low prices on the principal national securities exchange or the Nasdaq National Market on which it is so traded (or, in either event, such fewer number of days as such Common Stock has been so traded). If no such agreement is reached within thirty (30) days, the fair market value shall be determined by appraisal as set forth below. All appraisals shall be undertaken by two appraisers, one selected by the Company and one selected by the Purchasers of a majority of the Securities. The fair market value shall be the fair market value arrived at by those appraisers within sixty (60) days following the appointment of the last appraiser to be appointed. In the event that the two appraisers cannot agree on such fair market value within such a period of time, (i) if the appraisers' valuations are within 10% of each other the fair market value shall be the mean of the two valuations and (ii) if the differences in the valuations are greater, the appraisers shall elect a third appraiser who will calculate fair market value independently, and, except as provided in the next sentence, the fair market value of the Securities shall in each case be the average of the two fair market values arrived at by the appraisers who are closest in amount. If one appraiser's valuation is the mean of the other two valuations, the mean valuation shall be the fair market value. In the event that the two original appraisers cannot agree upon a third appraiser within thirty (30) days following the end of the sixty (60) day period referred to above, then the third appraiser shall be appointed by the American Arbitration Association upon the request of either party. If, following the conclusion of any appraisal referred to above, a Purchaser shall choose not to sell any or all of its Securities, then it shall so notify the Company, within twenty (20) days following receipt of the appraisal. If the Purchaser chooses not to sell any or all of its Securities and after the initiation of the procedures outlined in Section IV(A), then its rights hereunder shall terminate with respect to all such securities not offered to the Company. The expenses of the appraiser chosen by the Company will be borne by it, the expenses of the appraiser chosen by the Purchasers will be borne by the Purchasers and the expenses of the third appraiser will be borne 50% by the Company and 50% by the Purchasers. 3. Payment. The Company shall, within sixty (60) days following ------- either the agreement, as provided above, with the Purchasers concerning the fair market value of the Securities or the receipt of the results of the appraisal referred to above, to the extent permitted -12- by applicable law (the "Repurchase Date"), purchase the Securities tendered to it at the price established by the agreement or the appraisal and the Purchasers shall deliver to the Company, upon receipt of payment therefor, the certificates for the Securities duly endorsed by them. Payment shall be made by certified check or wire transfer of funds to such bank account or accounts as the Purchaser shall direct. B. Termination of Option. The obligation of the Company to purchase the --------------------- Purchased Common Stock as provided in this Agreement shall terminate upon (i) the closing of a Qualified Public Offering (as defined below); (ii) the closing of an acquisition, merger, exchange of securities, sale of all or substantially all of the assets of Company, reorganization in which the Company is not the surviving entity or a stock issuance or "reverse merger" in which the Company is the surviving entity but under which the holders of the Company's securities prior to such stock issuance or reverse merger do not hold more than fifty percent (50%) of the voting securities of the Company following such stock issuance or reverse merger; provided, however, that the Purchaser shall have the right to exercise the option granted pursuant to Section IV(A) hereof concurrently with such closing by delivering written notice of their intention to so exercise at least ten (10) days prior to the date of closing, and, provided further, that the Company shall provide the Holders not less than 30 days written notice of the closing of a transaction contemplated by this Section IV(B); or (iii) the liquidation of the Company. For purposes of this Agreement, a "Qualified Public Offering" shall mean an underwritten public offering in which the Company receives gross proceeds of not less than $10 million at a purchase price per share of not less than $3.52 (as adjusted for stock splits, dividends, recapitalization and the like). V MISCELLANEOUS A. Notices. All notices or other communications required or permitted to ------- be delivered hereunder shall be in writing signed by the party giving the notice to the Company at 9888 Carroll Center Road, Suite 200, San Diego, CA 92126-4581, Attn: President, and to the Purchasers at 499 Hamilton Avenue, Ste. 200, Palo Alto, CA 94301. Any Purchaser may at any time change the address to which notice shall be mailed by giving notice of such chance to the Company and to the other parties and such notice shall be deemed given when received by the other party hereto. B. Amendment. This Agreement may be amended with the written consent of --------- the Company and the written consent of the holders of a majority of the Securities held by the Purchasers. C. Entire Agreement. This Agreement constitutes the entire agreement of ---------------- the parties with respect to the matters contemplated herein. This Agreement supersedes any and all prior understandings as to the subject matter of this Agreement. D. Binding Effect; Assignment. This Agreement shall be binding upon and -------------------------- inure to the benefit of the successors and assigns of the respective parties hereto, except that the Company shall not have the right to assign its rights hereunder or any interest herein, and the rights and interests of the Purchasers shall be assignable, without the consent of the Company, to any assignee. -13- E. General. The headings contained in this Agreement are for reference ------- purposes only and shall not in any way affect the meaning or interpretation of this Agreement. In this Agreement the singular includes the plural, the plural the singular, the masculine gender includes the neuter, masculine and feminine genders. This Agreement shall be governed by and construed under the laws of the State of California. F. Severability. If any provision of this Agreement shall be found by any ------------ court of competent jurisdiction to be invalid or unenforceable, the parties hereby waive such provision to the extent that it is found to be invalid or unenforceable. Such provision shall, to the maximum extent allowable by law, be modified by such court so that it becomes enforceable, and, as modified, shall be enforced as any other provision hereof, all the other provisions hereof continuing in full force and effect. G. Counterparts. This Agreement may be executed in counterparts, all of ------------ which together shall constitute one and the same instrument. H. Dispute Resolution. The parties acknowledge and agree that time is of ------------------ the essence in resolving any dispute that may arise in connection with this Agreement. Except as provided herein, any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be settled by binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"). The expenses of the arbitration, including the arbitrator's fees, expert witness fees, and attorneys' fees, may be awarded to the prevailing party, in the discretion of the arbitrator, or may be apportioned between the parties in any manner deemed appropriate by the arbitrator. Unless and until the arbitrator decides that one party is to pay for all (or a share) of such expenses, the Company shall pay all reasonable expenses, including legal and accounting fees and costs arising in connection with enforcement of this Agreement or the Collateral Agreements. The parties shall keep confidential the decision of the arbitrator. Notwithstanding the foregoing, the parties may disclose information about such decision to persons who have a need to know, such as limited partners, directors, trustees, management employees, witnesses, experts, investors, attorneys, lenders, insurers, and others who may be affected. Once the arbitration award has become final, if the arbitration award is not promptly satisfied, then these confidentiality provisions shall no longer be applicable. Notwithstanding the foregoing, the parties will be entitled to enforce their rights under this Agreement specifically (without posting a bond or other security). The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and any party may in its sole discretion apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive relief in order to enforce or prevent any violation of the provisions of this Agreement. IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date first above written. COMPS INFOSYSTEMS, INC. By:______________________________________ Christopher A. Crane, President SUMMIT VENTURES III, L.P. By: Summit Partners III, L.P. General Partner By: Stamps, Woodsum & Co. III, General Partner By:_________________________________ General Partner SUMMIT INVESTORS II, L.P. By:_____________________________________ General Partner ________________________________________ Christopher A. Crane in his individual capacity ________________________________________ Robert C. Beasley in his individual capacity -15- EXHIBIT E Co-Sale Agreement RIGHT OF FIRST REFUSAL AND CO-SALE AGREEMENT -------------------------------------------- This Agreement is made as of October 14, 1994, by and among COMPS Infosystems, Inc., a Delaware corporation (the "Company"), Christopher A. Crane, in his individual capacity ("Crane"), and the Purchasers listed on Exhibit A --------- hereto. RECITALS -------- A. Crane currently owns shares of the Company's Common Stock (the "Common Stock"), as set forth on Exhibit B. --------- B. The Purchasers intend to purchase from the Company shares of its Series A Preferred Stock and warrants to purchase shares of the Company's Class B Common Stock ("Warrants"), pursuant to that certain Stock and Warrant Purchase Agreement entered into by and among the Company and the Purchasers dated of even date herewith (the "Stock and Warrant Purchase Agreement"). C. To induce the Purchasers to purchase such shares of stock and Warrants from the Company, Crane has agreed to grant the Purchasers certain rights of first refusal and co-sale with respect to Common Stock currently owned by Crane and any other stock of the Company hereafter owned or acquired by Crane, all on the terms and conditions set forth in this Agreement. NOW, THEREFORE, in consideration of the mutual promises herein contained, and other consideration, the receipt and adequacy of which hereby is acknowledged, the parties hereto agree as follows: 1. Certain Definitions. For purposes of this Agreement, the following ------------------- terms have the following meanings: (a) "IPO" means the first underwritten sale of Company securities to --- the public pursuant to registration statement under the Securities Act of 1933, as amended, in which the gross proceeds to the Company equal or exceed $10,000,000. (b) "Purchasers' Share" means as to the Right of Co-Sale, the ratio ----------------- determined by dividing (A) the number of shares of Stock (as defined below) held by a Purchaser by (B) the number of shares of Stock held by all Purchasers plus the number of shares of Stock held by Crane. (c) "Offered Stock" means all Stock proposed to be Transferred by ------------- Crane. (d) "Right of Co-Sale" means the right of co-sale provided to the ---------------- Purchasers in Section 4 of this Agreement. (e) "Right of First Refusal" means the right of first refusal ---------------------- provided to the Purchasers in Section 3 of this Agreement. -1- (f) "Stock" means and includes all shares of Common Stock issued and ----- outstanding at the relevant time plus (i) all shares of Common Stock that may be issued upon exercise of any options, warrants and other rights of any kind that are then exercisable, and (ii) all shares of Common Stock that may be issued upon conversion of (A) any convertible securities, including, without limitation, preferred stock and debt securities then outstanding, which are by their terms then convertible into or exchangeable for Common Stock or (B) any such convertible securities issuable upon exercise of options, warrants or other rights that are then exercisable. (g) "Transfer" means and includes any sale, assignment, encumbrance, -------- hypothecation, pledge, conveyance in trust, gift, transfer by bequest, devise or descent, or other transfer or disposition of any kind, including but not limited to transfers to receivers, levying creditors, trustees or receivers in bankruptcy proceedings or general assignees for the benefit of creditors, whether voluntary or by operation of law, directly or indirectly, except: (i) any bona fide pledge if the pledgee executes a counterpart copy of this Agreement and becomes bound thereby in the same manner as Crane; (ii) any transfers of Stock by Crane to Crane's spouse, lineal descendant or antecedent, father, mother, brother or sister of Crane, the adopted child or adopted grandchild of Crane, or the spouse of any child, adopted child, grandchild or adopted grandchild of Crane, or to a trust or trusts for the exclusive benefit of Crane or Crane's family members as described in this Section, or transfers of Stock by Crane by devise or descent, in all cases if the transferee or other recipient executes a counterpart copy of this Agreement and becomes bound thereby in the same manner as Crane; (iii) any transfer of Stock by Crane made: (A) pursuant to a merger or consolidation of the Company with or into another corporation or corporations; (B) pursuant to the winding up and dissolution of the Company; (C) at, and pursuant to, the IPO; or (D) to a Purchaser pursuant to this Agreement; (iv) any bona fide gift to not-for-profit organizations; or (v) any transfer of Stock by Crane to the Company pursuant to the repurchase of such Stock by the Company as permitted by Section 6.6 of the Stock and Warrant Purchase Agreement. 2. Notice of Proposed Transfer. Before Crane may effect any Transfer of --------------------------- any Stock, Crane must give at the same time to the Company and the Purchasers a written notice signed by Crane ("Crane's Notice") stating (a) Crane's bona fide intention to transfer such Offered Stock; (b) the number of shares of the Offered Stock; (c) the name, address and relationship, if any, to Crane of each proposed purchaser or other transferee; and (d) the bona fide cash price or, in reasonable detail, other consideration, per share for which Crane proposes to transfer such Offered Stock (the "Offered Price"). Upon the request of a Purchaser, Crane will promptly furnish such information, to the Purchasers, as may be reasonably requested to establish that the offer and proposed transferee are bona fide. -2- 3. Right of First Refusal. ---------------------- (a) Purchasers' Right. With respect to any Transfer by Crane, the ----------------- Purchasers shall have the right of first refusal to purchase all or any part of the Offered Stock, exercisable as set forth in Subsection (b) hereof. (b) Exercise of Purchasers' Right of First Refusal. The Purchasers' ---------------------------------------------- Right of First Refusal may be exercised as follows: (i) Each Purchaser shall have the opportunity to purchase all or any part of its pro rata share of Offered Stock. A Purchaser's pro-rata share shall be determined by dividing the number of shares of Stock held by a Purchaser by the total number of shares of Stock held by all Purchasers. The Purchasers shall be entitled to apportion Offered Stock to be purchased among its partners and affiliates, provided that such Purchaser notifies Crane of such allocation, and provided that such allocation does not threaten the Company's ability to rely upon an exemption from the registration provisions of the Act or the qualification provisions of applicable blue-sky laws. In addition, a Purchaser shall be entitled to assign its rights under this Section 3 to the Company. (ii) If any Purchaser or its assignees desires to purchase all or any part of the Offered Stock, such Purchaser must, within the twenty (20) day period (the "Purchaser Refusal Period") commencing on the date of Crane's Notice, give written notice to Crane and to the Company of such Purchaser's election to purchase the Offered Stock. In the event that any Purchaser elects not to purchase its pro-rata share of the Offered Stock, such shares may be purchased by the other Purchasers. (iii) Within ten (10) days after expiration of the Purchaser Refusal Period, the Company will give written notice (the "Purchasers' Expiration Notice") to Crane and to the Purchasers specifying either (A) that Offered Stock was subscribed by the Purchasers exercising their Rights of First Refusal or (B) that the Purchasers do not have the right to purchase any of the Offered Stock because the Purchasers did not timely exercise their Right of First Refusal to purchase Offered Stock, in which case the Purchasers' Expiration Notice will specify each Purchaser's Share of the Offered Stock with respect to the Right of Co-Sale. (c) Purchase Price. The purchase price for the Offered Stock to be -------------- purchased by the Purchasers exercising their Right of First Refusal under this Agreement will be the Offered Price, but will be payable as set forth in Section 3(d) hereof. If the Offered Price includes consideration other than cash, the cash equivalent value of the non-cash consideration will be determined by the Board of Directors of the Company in good faith, which determination will be binding upon the Purchasers and Crane absent fraud or error. (d) Payment. Payment of the purchase price for the Offered Stock ------- purchased by a Purchaser exercising its Right of First Refusal will be made within seven days after the date of the Purchaser's Expiration Notice. Payment of the purchase price will be made by the exercising Purchaser (i) in cash (by check), (ii) by cancellation of all or a portion of any outstanding indebtedness of Crane to the Purchaser or (iii) by any combination of the foregoing. -3- (e) Rights as a Stockholder. If the Purchasers exercise their Rights ----------------------- of First Refusal to Purchase the Offered Stock, then, upon the date the notice of such exercise is given by the Company, Crane will have no further rights as a holder of the Offered Stock except the right to receive payment for the Offered Stock from the Purchasers in accordance with the terms of this Agreement, and Crane will forthwith cause ail certificate(s) evidencing such Offered Stock to be surrendered to the Company for transfer to the Purchasers. (f) Crane's Right To Transfer. If the Purchasers have not elected to ------------------------- purchase all of the Offered Stock, then, subject to the Right of Co-Sale, Crane may transfer that portion of the Offered Stock permitted to be sold by Crane, to any person named as a purchaser or other transferee in Crane's Notice, at the Offered Price or at a higher price, provided that such transfer (i) is consummated within ninety (90) days after the date of Crane's Notice and (ii) is in accordance with all the terms of this Agreement. If the Offered Stock is not so transferred during such 90 day period, then Crane may not transfer any of such Offered Stock without complying again in full with the provisions of this Agreement. 4. Right of Co-Sale. ---------------- (a) Right of Co-Sale. If the Purchasers have waived or failed to ---------------- timely exercise their Rights of First Refusal, a Purchaser may transfer to the transferee proposed in Crane's Notice the Purchaser's Share of the Offered Stock, as such Share is specified in the Purchaser's Expiration Notice, by giving written notice to Crane, within ten (10) days after the date of the Purchaser's Expiration Notice, specifying the number of shares and type of Stock that the Purchaser desires to transfer to the transferee. (b) Consummation of Co-Sale. A Purchaser may exercise the Right of ----------------------- Co-Sale by delivering to Crane at the closing of the transfer of Offered Stock to such transferee (the "Closing") one or more certificates, properly endorsed for Transfer, representing such Stock to be Transferred by the Purchaser. At the Closing, such certificates or other instruments will be transferred and delivered to the transferee set forth in Crane's Notice in consummation of the transfer of the Offered Stock pursuant to the terms and conditions specified in such notice, and Crane will remit, or will cause to be remitted, to the Purchaser within seven (7) days after such Closing that portion of the proceeds of the Transfer to which the Purchaser is entitled by reason of the Purchaser's participation in such transfer pursuant to the Right of Co-Sale. 5. Multiple Series, Class or Type of Stock. If the Offered Stock consists --------------------------------------- of more than one series or class or type of Stock, the Purchaser has the right to purchase or transfer hereunder, as the case may be, each such series, class or type; provided, however, that if, as to the Right of Co-Sale, the Purchaser does not hold any of such series, class, or type, and the proposed transferee is not willing, at the Closing, to purchase some other series, class or type of Stock from the Purchaser, or is unwilling to purchase any Stock from the Purchaser at the Closing, then the Purchaser will have the put right (the "Put Right") set forth in Section 6(b) hereof. -4- 6. Refusal to Transfer; Put Right. ------------------------------ (a) Refusal to Transfer. Any attempt by Crane to transfer any Stock ------------------- in violation of any provision of this Agreement will be void. The Company will not be required (i) to transfer on its books any Stock that has been sold, gifted or otherwise transferred in violation of this Agreement, or (ii) to treat as owner of such Stock, or to accord the right to vote or pay dividends to any purchaser, donee or other transferee to whom such Stock may have been so transferred. (b) Put Right. If Crane transfers any Stock in contravention of the --------- Purchasers' Right of Co-Sale under this Agreement (a "Prohibited Transfer"), or if the proposed transferee of Offered Stock desires to purchase only the class, series or type of stock offered by Crane or is unwilling to purchase any Stock from the Purchaser and the provisions of Section 5 hereof apply, the Purchaser may, by delivery of written notice to Crane (a "Put Notice") within ten (10) days after (i) the Closing as defined in Subsection 4(b) above, or (ii) the date on which the Purchaser becomes aware of the Prohibited Transfer or the terms thereof require Crane to purchase from the Purchaser for cash or such other consideration as Crane received in the Prohibited Transfer or at the Closing that number of shares of Stock (of the same class, series or type as transferred in the Prohibited Transfer or at the Closing if the Purchaser then owns Stock of such class, series or type; otherwise of Common Stock) having a purchase price equal to the aggregate purchase price the Purchaser would have received in the closing of such Prohibited Transfer if the Purchaser had elected to exercise its right of Co-Sale with respect thereto or in the Closing if the proposed transferee had been willing to purchase the Stock of the Purchaser. The closing of such sale to Crane will occur within seven (7) days after the date of the Purchaser's Put Notice to Crane. 7. Restrictive Legend and Stock-Transfer Orders. -------------------------------------------- (a) Right of First Refusal and Co-Sale Legend. Crane understands and ----------------------------------------- agrees that the Company will cause the legend set forth below, or a legend substantially equivalent thereto, to be placed upon any certificate(s) or other documents or instruments evidencing ownership of Stock by Crane: THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RIGHTS OF FIRST REFUSAL AND RIGHTS OF CO-SALE AS SET FORTH IN A RIGHT OF FIRST REFUSAL AND CO-SALE AGREEMENT DATED OCTOBER 14, 1994, ENTERED INTO BY THE HOLDER OF THESE SHARES, THE COMPANY AND CERTAIN STOCKHOLDERS OF THE COMPANY. A COPY OF SUCH AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY. SUCH RIGHTS OF FIRST REFUSAL AND RIGHTS OF CO-SALE ARE BINDING ON CERTAIN TRANSFEREES OF THESE SHARES. (b) Stop Transfer Instructions. Crane agrees, to ensure compliance -------------------------- with the restrictions referred to herein, that the Company may issue appropriate "stop transfer" certificates or instructions and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its records. -5- 8. Termination and Waiver. ---------------------- (a) Termination. The Purchasers' Right of First Refusal and the Right ----------- of Co-Sale will terminate upon the earliest to occur of (i) the IPO, (ii) the dissolution of the Company, or (iii) the effective date of a consolidation or merger with or into another corporation as a result of which the stockholders of the Company prior to such transaction own less than 50% of the outstanding stock of the surviving corporation. (b) Waiver. The application of the Purchasers' Right of First Refusal ------ and/or the Right of Co-Sale as to any proposed Transfer by Crane of any Stock may be waived in advance of or after such transfer by the written agreement of the Purchasers. The Purchasers will have the absolute right to exercise or refrain from exercising any right or rights that such party may have by reason of this Agreement, including without limitation the right to purchase or participate in the sale of Offered Stock, and the Purchasers will not incur any liability to any other party hereto with respect to exercising or refraining from exercising any such right or rights. Any waiver by a party of its rights hereunder will be effective only if evidenced by a written instrument executed by such party or its authorized representative. 9. Miscellaneous Provisions. ------------------------ (a) Notice. Any notice required or permitted to be given to a party ------ pursuant to the provisions of this Agreement will be in writing and will be effective and deemed given under this Agreement on the earliest of (i) the date of personal delivery, or (ii) the date of delivery by facsimile, or (iii) the business day after deposit with a nationally-recognized courier or overnight service, including Express Mail, for United States deliveries or three (3) business days after such deposit for deliveries outside of the United States, or (iv) five (5) business days after deposit in the United States mail by registered or certified mail for United States deliveries. All notices not delivered personally or by facsimile will be sent with postage and other charges prepaid and properly addressed to the party to be notified at the address set forth below such party's signature on this Agreement or at such other address as such party may designate by ten (10) days advance written notice to the other parties hereto. All notices for delivery outside the United States will be sent by facsimile, or by nationally recognized courier or overnight service, including Express Mail. Any notice given hereunder to more than one person will be deemed to have been given, for purposes of counting time periods hereunder. on the date given to the last party required to be given such notice. Notices to the Company will be marked to the attention of the President. (b) Binding on Successors and Assigns; Inclusion Within Certain ----------------------------------------------------------- Definitions. This Agreement, and the rights and obligations of the parties - ----------- hereunder, will inure to the benefit of, and be binding upon, their respective successors, assigns, heirs, executors, administrators and legal representatives. Any permitted transferee of Crane who is required to become a party hereto will be considered "Crane" for purposes of this Agreement and any permitted transferee of Stock held by a Purchaser will be considered a "Purchaser" for purposes of this Agreement. (c) Severability. If any provision of this Agreement is held to be ------------ invalid, illegal or unenforceable in any respect, such provision will be enforced to the maximum extent possible and such invalidity, illegality or unenforceability will not affect any other provision of -6- this Agreement, and this Agreement will be construed as if such invalid, illegal or unenforceable provision had (to the extent not enforceable) never been contained herein. (d) Amendment. This Agreement may be amended only by a written --------- instrument executed by the Company, the Purchasers holding a majority of the Stock then held by all Purchasers and Crane. (e) Continuity of Other Restrictions. Any Stock not purchased by a -------------------------------- Purchaser under their Right of First Refusal hereunder will continue to be subject to all other restrictions imposed upon such Stock by law, including any restrictions imposed under the Company's Articles of Incorporation or By-laws, or by agreement. (f) Governing Law. This Agreement will be governed by and construed ------------- in accordance with the laws of the State of California, excluding that body of law pertaining to conflict of laws. (g) Obligation of Company; Binding Nature of Exercise. The Company ------------------------------------------------- agrees to use its best efforts to enforce the terms of this Agreement, to inform Crane and the Purchasers of any breach hereof (to the extent the Company has knowledge thereof) and to use reasonable efforts to assist Crane and the Purchasers in the exercise of their rights and the performance of their obligations hereunder. Any exercise of the Right of First Refusal or Right of Co-Sale will be binding upon the party so exercising, and may not be withdrawn without the written consent of Crane, except that such exercise may be withdrawn unilaterally by the exercising party if there is any legal prohibition as to a party's consummation of its purchase or sale hereunder. (h) Counterparts. This Agreement may be executed in any number of ------------ counterparts, each of which when so executed and delivered will be deemed an original, and all such counterparts together will constitute one and the same instrument. (i) Entire Agreement. This Agreement constitutes the entire agreement ---------------- of the parties with respect to the specific subject matter hereof and supersedes in their entirety all other agreements or understandings between or among the parties hereto with respect to such specific subject matter. (j) Conflict. In the event of any conflict between the terms of this -------- Agreement and the Company's Articles of Incorporation, or its By-laws, the terms of the Company's Articles of Incorporation. or its By-laws, as the case may be, will control. In the event of any conflict between the terms of this Agreement and any other agreement to which Crane is a party or by which Crane is bound, the terms of this Agreement will control. In the event of any conflict between the Company's books and records and this Agreement or any notice delivered hereunder, the Company's books and records will control absent fraud or error. (k) Dispute Resolution. The parties acknowledge and agree that time ------------------ is of the essence in resolving any dispute that may arise in connection with this Agreement. Except as set forth herein, any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be settled by binding arbitration in accordance with the Commercial Arbitration Rules of the American -7- Arbitration Association ("AAA"). The expenses of the arbitration, including the arbitrator's fees, expert witness fees, and attorney's fees, may be awarded to the prevailing party, in the discretion of the arbitrator, or may be apportioned between the parties in any manner deemed appropriate by the arbitrator. Unless and until the arbitrator decides that one party is to pay for all (or a share) of such expenses, the Company shall pay reasonable expenses, including legal and accounting fees and costs arising in connection with enforcement of this Agreement or the Collateral Agreements. The parties shall keep confidential the decision of the arbitrator; however, the parties may disclose information about such decision to persons who have a need to know, such as limited partners, directors, trustees, management employees, witnesses, experts, investors, attorneys, lenders, insurers, and others who may be directly affected. Once the arbitration award has become final, if the arbitration award is not promptly satisfied, then these confidentiality provisions shall no longer be applicable. Notwithstanding the foregoing, the parties will be entitled to enforce their rights under this Agreement specifically (without posting a bond or other security). The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and any party may in its sole discretion apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive relief in order to enforce or prevent any violation of the provisions of this Agreement. -8- IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above. COMPS INFOSYSTEMS, INC. By:________________________________________ Christopher A. Crane, President Address: 9888 Carroll Center Rd., Ste. 200 San Diego, California 92126-4581 (619) 578-3000 CHRISTOPHER A. CRANE ___________________________________________ Christopher A. Crane, in his individual capacity Address: c/o COMPS Infosystems, Inc. 9888 Carroll Center Road, Suite 200 San Diego, CA 92126-4581 (619) 578-3000 PURCHASERS: SUMMIT VENTURES III, L.P. By: Summit Partners III, L.P. General Partner By: Stamps, Woodsum & Co. III, General Partner By:___________________________________ General Partner -9- SUMMIT INVESTORS II, L.P. By:________________________________________ General Partner Address: 499 Hamilton Avenue, Suite 200 Palo Alto, CA 94301 (415) 321-1166 -10- EXHIBIT F Shareholder Buy-Out and Voting Agreement SHAREHOLDERS BUY-OUT AND VOTING AGREEMENT ----------------------------------------- This Shareholders Buy-Out and Voting Agreement (the "Agreement") is made as of October 14, 1994 by and between Robert Beasley, an individual ("Beasley"), Christopher Crane, an individual ("Crane"), COMPS InfoSystems, Inc., a Delaware corporation (the "Company"), Summit Ventures III, L.P. and Summit Investors II. L.P. (together, "Summit"). Beasley and Crane own all of the Company's outstanding shares of Series A Common Stock, par value $.01 per share as follows:
Shareholder Total Number of Shares Percentage ----------- ---------------------- ---------- Robert Beasley 1,620,500 25% Christopher Crane 4,861,500 75%
IT IS HEREBY AGREED: ARTICLE I --------- DEFINITIONS ----------- As used herein, the terms set forth below shall have the following definitions: 1.1 Shareholders shall mean Beasley, Crane, any future holder of Shares ------------ issued by the Company hereafter who joins as a party to this Agreement, and any transferee of Shares pursuant to Section 3.3 of this Agreement. At such time as a person sells all of his Shares in accordance with the terms and conditions of this Agreement, that person shall no longer be deemed to be a Shareholder for purposes of this Agreement. 1.2 Shares shall mean all of the equity securities of the Company now ------ owned or hereafter acquired by any Shareholder or a Permitted Transferee. 1.3 Permitted Transferee shall mean any transferee to whom transfer of -------------------- Shares is permitted pursuant to Section 2.2. 1.4 Purchase Price and Payment Terms shall mean the Purchase Price, as -------------------------------- defined in Section 8.1.1, and the Payment Terms, as defined in Section 8.2, for the purchase by Crane of Shares referenced in Articles 3, 4, and 6. 1.5 Option Event shall mean any one or more of the events giving rise to ------------ the option to purchase Shares set forth in Article 6. A-1 ARTICLE 2 --------- RESTRICTION ON TRANSFER OF SHARES --------------------------------- 2.1 2.1.1 Restriction on Transfer. No Shareholder or Permitted ----------------------- Transferee shall transfer, encumber or in any way dispose of any of his Shares, or any right or interest therein, except in accordance with the provisions of this Agreement or unless such Shareholder has obtained the prior written consent of the Company and of the holders of a majority of the outstanding Shares. In the event any Shareholder or Permitted Transferee shall attempt to transfer any or all of his Shares in violation of this Agreement, such transfer shall be null and void and of no effect. 2.1.2 Put Right. If a transferring shareholder (as defined in --------- Section 3.1) transfers any Shares in contravention of the Right of Co-Sale described in Section 3.6 under this Agreement (a "Prohibited Transfer"), or if the proposed transferee of Offered Stock (as defined in Section 3.6) desires to purchase only the class, series or type of stock offered by the transferring shareholder or is unwilling to purchase any Shares from Summit and the provisions of Section 3.6 apply, Summit may, by delivery of written notice to the transferring shareholder (a "Put Notice") within ten (10) days after (i) the Closing as defined in Section 3.6 or (ii) the date on which Summit becomes aware of the Prohibited Transfer or the terms thereof, require the transferring shareholder to purchase from Summit for cash or such other consideration as the transferring shareholder received in the Prohibited Transfer or at the Closing that number of Shares of Stock held by Summit (of the same class, series or type as transferred in the Prohibited Transfer or at the Closing if Summit then owns stock of such class, series or type; otherwise, of shares of Series A Common Stock, par value $.01 per share), having a purchase price equal to the aggregate purchase price that Summit would have received in the closing of such Prohibited Transfer if Summit had elected to exercise its right of Co-Sale with respect thereto or in the Closing if the proposed transferee had been willing to purchase Shares held by Summit. The closing of such sale to the transferring shareholder will occur within seven (7) days after the date of Summit's Put Notice to the transferring shareholder. 2.2 Permitted Transfers. Notwithstanding anything herein to the contrary, ------------------- any Shareholder may make a gift or gifts of any or all of his Shares to the Shareholder's spouse, children or grandchildren, or the spouse of any one of them or to any organization described in Section 170(c) of the Internal Revenue Code of 1986, as amended, provided, that nothing herein shall be construed as permitting a transfer not otherwise in compliance with provisions of Section 9.2 and provided further, that each such Permitted Transferee subscribes to this Agreement. In the event any transfer permitted by this Section 2.2 is consummated, each Permitted Transferee shall be bound by and subject to the terms of this Agreement. 2.3 Repurchase by Company. Notwithstanding any other provision herein, --------------------- the parties agree that the provisions of this Agreement shall not apply to (i) the repurchase by the Company, on or before October 31, 1994, of up to 725,960 Shares held by Beasley or (ii) the transfer by Beasley, on or before October 31, 1994, of up to 154,000 Shares held by Beasley, to a non-profit organization. A-2 ARTICLE 3 --------- RIGHTS OF FIRST REFUSAL ----------------------- 3.1 Crane's Right of First Refusal. In the event that Beasley or any ------------------------------ other Shareholder other than Crane desires to transfer any or all of his Shares of the Company to other than a Permitted Transferee (sometimes referred to hereinafter as the "transferring Shareholder"), he shall first provide notice in writing to the Secretary of the Company (sometimes referred to hereinafter as "notice of intended transfer"). The notice shall name the proposed transferee and specify the number of Shares to be transferred, the price per share, and the terms of payment of the purchase price. Promptly upon receipt of said notice, the Secretary of the Company shall notify Crane of said proposed sale or transfer (sometimes referred to herein as the "notice to Crane.") Said notice to Crane shall contain (i) the same information concerning the proposed sale or transfer as received by the Company in the notice of intended transfer and (ii) the Purchase Price and Payment Terms. Crane shall have twenty (20) days from the date of receipt of said notice within which to exercise the option to acquire such shares at a purchase price equal to (a) if the transferring Shareholder is Beasley, the same price per share and upon the same terms set forth in the notice of intended transfer, or (b) if the transferring Shareholder is someone other than Beasley, at the lower of (i) the same price per share and upon the same terms set forth in the notice of intended transfer filed, or (ii) the Purchase Price and Payment Terms. Within twenty (20) days after the date of mailing of said notice to Crane, if Crane desires to acquire any or all of the Shares referred to in said notice, Crane shall deliver to the Secretary a written offer to purchase (sometimes hereinafter referred to as "Crane offer to purchase") said Shares or a specified number thereof, at Crane's discretion. In the event Crane exercises said option within the twenty (20) day period, the Secretary of the Company shall give notice of the exercise to the transferring Shareholder. 3.2 Summit Right of First Refusal. If any such Shares shall not be ----------------------------- purchased by Crane, the Secretary shall notify Summit of said proposed sale or transfer (sometimes hereinafter referred to as "notice to Summit"). Said notice to Summit shall contain (i) the same information concerning the proposed sale or transfer as received by the Secretary of the Company in the notice of intended transfer, (ii) the number of Shares, if any, which Crane has elected to purchase. The Secretary shall notify Summit of said notice promptly upon receipt by the Secretary of notification from Crane that Crane will not purchase any or all of said Shares, and in no event later than thirty (30) days after receipt by the Company of the notice of intended transfer. Summit shall have twenty (20) days from the date of receipt of said notice within which to exercise the option to purchase any or all of the remaining Shares at the purchase price and on the terms stated in the notice. 3.3 Permitted Transfer Upon Failure to Buy All Shares. Subject to the ------------------------------------------------- provisions of Section 3.6, if some or all the Shares mentioned in the notice of intended transfer are not purchased by Crane or Summit, or both, such Shares may be sold or transferred, at any time within six (6) months from the date of receipt by the Company of the notice of intended transfer, to the person at the price and terms specified therein or at a price and terms more favorable to the transferring Shareholder, provided, that each such purchaser or transferee subscribes to this Agreement. Each such purchaser or transferee shall receive and hold said Shares as a Shareholder subject to all of the provisions and restrictions herein contained and the transferring A-3 Shareholder shall no longer be deemed a Shareholder as to such Shares for purposes of this Agreement. 3.4 Nonmonetary Consideration. Notwithstanding anything to the contrary ------------------------- in this Agreement, in the event that part or all of the purchase price specified in the notice of intended transfer is payable other than in money, such notice shall also specify the fair market value in monetary terms of the property other than money to be transferred in partial or full satisfaction of the purchase price; and Crane and Summit, or either of them, shall have the right to exercise their respective options to purchase said Shares by delivery of a written Offer specifying a per share purchase price equal to the per share purchase price specified in the notice of intended transfer, which price shall have taken into account the fair market value of any such property to be transferred. With regard to the term of the offer of Crane or Summit, the fair market value of consideration other than money shall be paid in cash. As used in this Agreement, "consideration other than money" shall not mean the proposed purchaser's promissory note or other evidence of indebtedness where such note or indebtedness has a fair maker value at least equal to its principal amount. 3.5 Appraisal to Determine Value of Nonmonetary Consideration. In the --------------------------------------------------------- event Crane objects to the amount specified in the notice of intended transfer as the fair market value of consideration other than money, Crane may give, within twenty (20) days from the date that the Secretary gives the notice to Crane, written notice to the Secretary of Crane's intention to submit the matter to an appraiser for a determination of the fair market value of the consideration Other than money. In the event Summit objects to the amount specified in the notice of intended transfer as the fair market value of consideration other than money, Summit may give, within thirty (30) days of the receipt of the notice to Summit, written notice to the Secretary of Summit's intention to submit the matter to an appraiser for a determination of the fair market value of the consideration other than money. Pending such determination, the time for exercising options to purchase shall be stayed. Within fifteen (15) days from the date of delivery of such notice of submission to an appraiser, the objector and the transferring Shareholder shall select a single, mutually satisfactory neutral appraiser. In the event the parties are unable to agree on the selection of such an appraiser, then (i) the transferring Shareholder, Permitted Transferee or personal representative thereof shall select a single neutral appraiser, on the one hand, and (ii) Crane or Summit, on the other hand, shall select a single neutral appraiser, and the two (2) appraisers so selected shall meet and select a single, mutually satisfactory neutral appraiser. The third appraiser so selected shall determine the fair market value of the consideration other than money. The decision of the appraiser shall be final and binding upon the objector and the holder of the Shares to be sold. As soon as the fair market value of the consideration other than money has been determined, the appraiser shall give written notice thereof to the objector, the holder of the Shares to be sold, and to the Secretary. All expenses of appraisal and proceedings to appoint an appraiser shall be borne equally by the parties who exercise their option to purchase Shares (who shall share such expenses between themselves in proportion to the number of Shares each elects to purchase), on the one hand, and the holder of Shares to be sold on the other, unless Crane and Summit thereafter fails to exercise his or its option, in which case the objector shall bear all such expenses. In the event the objector is Summit, and the appraisal reduces the purchase price specified in the notice of intended transfer, Crane and, if Crane does not elect to purchase all the Shares, then Summit shall again be A-4 provided the notices pursuant to Sections 3.1 and 3.2 and the notice periods shall commence again. 3.6 Right of Co-Sale. If Summit has waived or failed to timely exercise ---------------- its right of first refusal pursuant to Section 3.2, Summit may transfer to the transferee proposed in notice of intended transfer Summit's Share (as defined in the next sentence) of the shares subject to the notice of intended transfer (the "Offered Stock"), by giving written notice to the transferring shareholder, within ten (10) days after the date that Summit's right of first refusal specified in Section 3.2 expires, specifying the number of Shares that Summit desires to transfer to the transferee. For purposes of this Section 3.6, "Summit's Share" shall mean: the ratio determined by dividing (A) the number of Shares held by Summit by (B) the number of Shares held by Summit plus the number of Shares held by the transferring shareholder. Summit may exercise its right of co-sale by delivering to the transferring shareholder at the closing of the transfer of Offered Stock to such transferee (the "Closing") one or more certificates, properly endorsed for transfer, representing such Shares to be transferred by Summit. At the Closing, such certificates or other instruments will be transferred and delivered to the transferee set forth in the notice of entitled transfer in consummation of the transfer of the Offered Stock pursuant to the terms or conditions specified in such notice, and the transferring shareholder will remit, or will cause to be remitted, to Summit within seven (7) days after such Closing that portion of the proceeds of the Transfer to which Summit is entitled by reason of Summit's participation in such transfer pursuant to the right of co-sale. 3.7 Multiple Series, Class or Type. If the Offered Stock consists of more ------------------------------ than one series or type of the Company's stock, Crane and Summit have the right to purchase or transfer hereunder, as the case may be, each such series, class or type; provided, however, that if, as to the Right of Co-Sale, Summit does not hold any of such series, class or type, and the proposed transferee is not willing, at the Closing, to purchase some other series, class or from Summit, or is unwilling to purchase any Shares from Summit at the Closing, then Summit will have the put right (the "Put Right") set forth in Section 2.1.2 hereof. ARTICLE 4 --------- PURCHASE ON DEATH ----------------- 4.1 Crane Purchase on Death of Beasley or a Permitted Transferee. Within ------------------------------------------------------------ a period commencing with the death of Beasley or a Permitted Transferee and ending 180 days following the death of the Beasley or a Permitted Transferee, but in no event sooner than ninety (90) days following written notice of such death delivered to the Company, Crane shall have the option to purchase all or a portion of the Shares owned by the decedent and his Permitted Transferees at the Purchase Price and Payment Terms. 4.2 Summit Purchase Upon Crane Restriction. In the event that Crane does -------------------------------------- not elect to repurchase any or all of the Shares owned by a decedent and his Permitted Transferees, as referenced in Section 4.1, Crane shall purchase as many Shares as he elects to purchase, and Summit shall have the option to purchase the remainder of the Shares of the decedent and his Permitted Transferees at the Purchase Price and Payment Terms. A-5 4.3 Failure to Buy All Shares. If all of the Shares of Beasley or a ------------------------- Permitted Transferee that are available for purchase by Crane or Summit, or both, pursuant to this Article 4 are not purchased by Crane or Summit, or both, the personal representative of Beasley or a Permitted Transferee shall continue to hold the Shares subject to the provisions or this Agreement. ARTICLE 5 --------- [INTENTIONALLY DELETED] ARTICLE 6 --------- OPTION TO PURCHASE ON OTHER EVENTS ---------------------------------- 6.1 Option Events. The occurrence of any one or more of the following ------------- Option Events shall give rise to the options to purchase Shares set forth in Sections 6.2 and 6.3 herein: 6.1.1 The adjudication as a bankrupt (in voluntary or involuntary proceedings) of Beasley or Permitted Transferee; or 6.1.2 The filing by Beasley or Permitted Transferee of a petition under the Federal Bankruptcy Code or comparable state laws for a reorganization, arrangement or other judicial protection upon insolvency; or 6.1.3 The assignment by Beasley or Permitted Transferee for the benefit of creditors; or 6.1.4 The Shares owned by Beasley or Permitted Transferee become the subject of a judgment, lien. assignment by operation of law, or writ of attachment, which is not released within thirty (30) days (unless a supersede bond is filed). 6.2 Crane Option to Purchase. Upon the occurrence of any one or more of ------------------------ the Option Events, Crane shall have an option to purchase the Shares owned by the affected Permitted Transferee or Beasley and his Permitted Transferees, if any, as the case may be. Promptly upon the occurrence of an Option Event, the affected Permitted Transferee or Beasley and his Permitted Transferees shall provide the Secretary of the Company with notice of the occurrence of such event (sometimes hereinafter referred to as "notice of Option Event"), with an informational copy for Crane. Promptly on receipt of said notice, the Secretary of the Company shall forward a copy of the notice to Crane. Crane shall have thirty (30) days from the date of receipt of said notice by the Secretary within which to exercise the option to purchase the Shares at the Purchase Price and Payment Terms. In the event that Crane exercises said option within the thirty (30) day period, the Secretary of the Company shall give notice of the fact to the affected Permitted Transferee or Beasley and his Permitted Transferees, if any. 6.3 Summit Option to Purchase. If any such Shares shall not be purchased ------------------------- by Crane, the Secretary shall notify Summit of the occurrence of an Option Event (sometimes referred to as "Summit notice of Option Event"). The Summit notice of Option Event shall contain (i) the A-6 statement that an Option Event has occurred, (ii) the Purchase Price and (iii) the number of Shares, if any, which Crane has elected to purchase. The Secretary shall mail to Summit said notice promptly upon receipt by the Secretary of notification from Crane that Crane will not purchase any or all of said Shares, and in no event later than forty (40) days after receipt by the Secretary of the notice of Option Event. Summit shall have twenty (20) days from the date of receipt of such notice within which to purchase any or all of said Shares at the Purchase Price and Payment Terms. 6.4 Failure to Buy All Shares. If all the Shares of the affected ------------------------- Permitted Transferee or Beasley and his permitted Transferees, if any, as the case may be, are not purchased by Crane or Summit, or both, Beasley, Permitted Transferees, or his personal representative, if any, shall continue to hold the Shares subject to the provisions of this Agreement. ARTICLE 7 --------- CRANE OPTIONS ------------- TO PURCHASE UPON CERTAIN EVENTS ------------------------------- 7.1 Events Triggering Crane's Options. The occurrence of any one or more --------------------------------- of the following events commencing with the date of this Agreement will give rise to the options to purchase Shares set forth in Section 7.2: 7.1.1 The Company enters into a definitive agreement for the sale of all or substantially all of its assets; or 7.1.2 The holders of a majority in interest of the Company's outstanding capital stock enter into a definitive agreement for the sale of such stock to a party other than a Shareholder. 7.2 Crane's Options to Purchase. Upon the occurrence of any one or more --------------------------- of the events set forth in Section 7.1, Crane, for as long as he is a Shareholder, shall have the option to purchase the Shares owned by each of the other Shareholders and their Permitted Transferees at a purchase price equal to the same price per share and upon the same term as those of the transaction involving the sale of the Company's assets or stock. The options arising by reason of Section 7.1.1 or 7.1.2 shall be exercisable immediately before the closing of the transaction involving the sale of the Company's assets or stock. ARTICLE 8 --------- PURCHASE PRICE, PAYMENT TERMS AND TRANSFER OF SHARES ---------------------------------------------------- 8.1 Purchase Price. The purchase price on the purchase of Shares, whereby -------------- the price is the Purchase Price, shall be determined as follows: 8.1.1 Value. The Purchase Price to be paid for each of the Shares ----- shall be equal to the "Fair Market Value" of the Company, divided by the total number of Shares outstanding as of the date the Purchase Price is to be determined. As used herein, prior to the time when the Company's equity securities are publicly held, the "Fair Market Value" shall be the highest of (i) A-7 the "Earnings Price" (ii) the "Book Value Price" or (iii) $3,000,000. The "Earnings Price" shall be a value determined by multiplying the Company's average earnings (defined as net income before taxes) for the preceding three (3) fiscal years by five (5); provided, however, that in determining net income for such three (3) fiscal years, any amounts paid as total compensation to Beasley and Crane in any such year which exceeds an aggregate of $300,000 (which amount shall be adjusted each year to reflect changes in the Consumer Price Index for San Diego County) shall be added back to earnings for such year (with a concurrent adjustment for any expense deduction taken by the Company on account of the payment thereof). The "Book Value Price" shall be the book value of the Company, determined in accordance with generally accepted accounting principals, as of the end of the immediately preceding fiscal year. For purposes of calculating "Fair Market Value" under this section, any insurance proceeds received by the Company on account of the death or disability of a Shareholder or Permitted Transferee to the extent of any such proceeds which must be paid as a cash down payment for the purchase of Shareholders pursuant to Section 8.2.1, shall not be included in the calculation of "Fair Market Value." As used herein, after the time when the Company's equity securities are publicly held, the "Fair Market Value" shall be the mean 30-day price of the Shares for the period ending 5 days prior to the proposed transfer or sale of Shares, based upon the following: (i) the 30 day average closing price of the Shares on the principal exchange on which the Shares are then trading; or (ii) if the Shares are not traded on an exchange but are quoted on Nasdaq or a successor quotation system, the 30 day average of (1) the last sales price (if the Shares are then used as a National Market Issue under the NASD National Market System) or (2) the mean between the closing representative bid and asked prices (in all other cases) for the Shares as reported by Nasdaq or such successor quotation system; or (iii) if not publicly traded on an exchange and not quoted on Nasdaq or a successor quotation system, the 30-day mean between the closing bid and asked prices for the Shares, as determined in good faith by the Company's Board of Directors. 8.1.2 Disputes. In the event of any disputes in the computation of -------- the Company's Fair Market Value pursuant to the terms of Section 8.1.1, a statement prepared by the Company's accountants as to the Fair Market Value (as determined pursuant to Section 8.1.1 shall be conclusive and binding on the parties. At such time the parties shall sign a statement agreeing to hold such accountants harmless for their role in the preparation of such valuation. 8.2 Payment Terms. The Payment Terms on the purchase of Shares, whereby ------------- the purchase price is the Purchase Price and this Agreement provides that the Shares may be purchased pursuant to the Payment Term, shall be as follows: 8.2.1 Downpayment. A cash downpayment in the amount of 20% of the ----------- Purchase Price; provided, that in the event the purchaser's option to purchase arises by virtue of the death or disability of a Shareholder or Permitted Transferee, the greater of (i) 20% of the Purchase Price or (ii) the full amount of any insurance proceeds received by such purchaser as a lump sum payment on account of such death or disability (up to a maximum of the total Purchase Price) shall be paid as a cash downpayment hereunder. The cash downpayment shall be payable upon delivery by the transferring Shareholder, Permitted Transferee, or the estate, as the case may be, of (i) an appropriate receipt, (ii) certified copy of a court order confirming the sale and the consent of the inheritance tax appraiser to such transfer, if applicable, (iii) the consent of any A-8 state or federal authorities, if required, and (iv) any other documents the purchaser or purchaser's counsel may reasonably require to effect a lawful and valid transfer of the Shares. 8.2.2 Promissory Note. Any unpaid balance of the Purchase Price --------------- shall be evidenced by a negotiable promissory note in the form of Exhibit "A" attached hereto, and, in the event the Company is the transferee, the promissory note shall contain on its face a legend in the form Set forth on the top of Exhibit "A." 8.2.3 Pledge of Shares. The promissory note delivered pursuant to ---------------- Section 8.2.2 herein shall be secured by a Security Agreement in the form attached hereto as Exhibit "B," and the purchaser shall execute and deliver such agreement with the consideration for the sale. 8.3 Transfer. On the occurrence of any event that leads to the purchase -------- of Shares under this Agreement, the consideration to be paid for the Shares shall be forthwith paid to the transferring Shareholder or Permitted Transferee, or his estate, as the case may be. If the event that leads to the purchase is the death of any Shareholder or Permitted Transferee, the decedent's personal representative shall apply for and obtain any necessary court approval or confirmation of the sale of the decedent's Shares pursuant to this Agreement. In all events, consideration for the Shares purchased shall be delivered as soon as practicable to the person entitled to it, and the Secretary shall cause the certificates representing the purchased Shares to be properly endorsed and shall issue new certificate(s) in the names of the purchaser or purchasers. ARTICLE 9 --------- SUMMIT'S ASSIGNMENT TO THE COMPANY; ----------------------------------- COMPANY RESTRICTIONS -------------------- 9.1 Assignment by Summit. Summit shall be entitled to assign its rights -------------------- to purchase Shares under Sections 3. 4 and 6 to the Company. 9.2 Limitation on Repurchase of Shares. In the event that, pursuant to ---------------------------------- the terms of Section 9.1, Summit assigns its right to purchase Shares to the Company, the right of the Company to exercise the option and to purchase such Shares is subject to and conditioned upon compliance with the restrictions, if any, governing the right of a corporation to purchase its own shares or make distributions to shareholders, contained in such applicable governmental or judicial restrictions as may from time to time be effective. 9.3 Order of Combined Purchase. In the event that some but less than all -------------------------- of Shares to be purchased pursuant to the terms of this Agreement are to be purchased by the Company, with the remaining Shares owned by the transferring Shareholder to be purchased by Crane or Summit or both, the parties shall consummate the purchase of Shares by Crane or Summit or both prior to or simultaneously with the purchase of Shares by the Company. The prior or simultaneous purchase by Crane or Summit or both, as applicable, shall be a condition to the consummation of the purchase by the Company. A-9 ARTICLE 10 ----------- SHARE CERTIFICATES ------------------ 10.1 Share Certificates. Upon execution of this Agreement, each ------------------ Shareholder except Crane (and thereafter, each Permitted Transferee) shall have placed on the certificates representing his Shares, the following legend: "Sale, transfer or hypothecation of the shares represented by this certificate is restricted by the provisions of a Buy-Out and Voting Agreement among the Shareholders and the Company dated October 14, 1994, a copy of which may be inspected at the principal office of the Company, and all of the provisions of which are incorporated by reference in this certificate." A copy of this Agreement shall be delivered to the Secretary of the Company and shall be shown by the Secretary to any interested person making proper inquiry about it. Subject to the terms of Article II of this Agreement, each Shareholder and Permitted Transferee of record shall have the right to vote his Shares and receive any distributions with respect to them until his Shares are sold or transferred as provided in this Agreement. 10.2 Restrictions on New Certificates. Any new certificates issued by the -------------------------------- Company upon cancellation of Shares or any newly issued Shares shall be likewise issued subject to the terms of this Agreement. Such certificates shall bear the endorsement set forth in Section 10.1 hereof, and as a condition of issuance of such new certificates the Secretary of the Company shall first obtain a written acceptance of the terms of this Agreement from the proposed transferee or new issue. 10.3 Warranty of Title. Each Shareholder hereby warrants and represents ----------------- that he has good and marketable title to his Shares and that his Shares may be transferred free and clear of any lien, encumbrance or restriction, except those imposed by the terms of this Agreement, and if applicable, any lien, encumbrance or restriction imposed by applicable governmental or judicial entities provided, however, that the parties acknowledge that Crane's Shares are subject to certain transfer restrictions pursuant to that certain Right of First Refusal and Co- sale Agreement between Crane, Summit and the Company dated as of October 14, 1994. ARTICLE 11 ---------- VOTING AGREEMENT ---------------- 11.1 Crane's Right to Vote Beasley's Shares. Until the termination of -------------------------------------- this Agreement in accordance with Section 12.1 below, Crane or Crane's designee shall have the exclusive right to vote all Shares held by (i) Beasley. (ii) Beasley's Permitted Transferees, or (iii) any transferee of the Shares held by Beasley as of the date of this Agreement, (collectively, the "Beasley Shares") in person or by proxy at all shareholder meetings and in all proceedings in which the vote or consent of the shareholders may be required or authorized, and shall have all the rights, privileges and powers of a shareholder except as, otherwise provided in this Section 11. A-10 11.2 No Sale of Beasley Shares. Crane shall not have authority to sell or ------------------------- otherwise dispose of the Beasley Shares. 11.3 Dividends; Distributions. Crane shall have no right to receive ------------------------ dividends or other distributions on the Beasley Shares. 11.4 Application of Voting Agreement to After-Acquired Shares. After the -------------------------------------------------------- date of this Agreement, the provisions of this Section 11 shall apply to all Shares issued to Beasley, his Permitted Transferees, or any other transferee of the Shares, and all securities issued as a replacement for the Beasley Shares or with respect to the Beasley Shares as a result of any stock dividend, stock split or other similar event. ARTICLE 12 ---------- MISCELLANEOUS ------------- 12.1 Termination of Agreement. This Agreement shall terminate on any of ------------------------ the following events: 12.1.1 The written agreement of all the then Shareholders; or 12.1.2 The dissolution, bankruptcy or insolvency of the Company; or 12.1.3 At such time as only one Shareholder remains; or 12.1.4 October 1, 2004. provided, however, that all rights of Summit under this Agreement shall terminate upon the earliest to occur of (i) the completion by the Company of an underwritten sale of Company securities to the public pursuant to a registration statement under the Securities Act of 1933, as amended, in which the gross proceeds to the Company equal or exceed $10,000,000; (ii) the dissolution of the Company; or (iii) the effective date of a consolidation or merger with or into another corporation as a result of which the stockholders of the Company prior to such transaction own less dm 50% of the outstanding stock of the surviving corporation. 12.2 Necessary Acts. Each party to this Agreement agrees to perform any -------------- further acts and execute and deliver any documents that may be reasonably necessary to carry out the provisions of this Agreement. 12.3 Amendments. The provisions of this Agreement may be waived, altered, ---------- amended or repealed in whole or in part only upon the written consent of all the parties to this Agreement provided, however, that the provisions of Article 7 and Article11 may be waived, altered, amended, or repealed in whole or in part upon the written consent of all the parties to this Agreement except for Summit. 12.4 Successors and Assigns. This Agreement shall be binding on and shall ---------------------- inure to the benefit of the parties to it and their respective heirs, legal representatives, successors and assigns. 12.5 Validity of Agreement. Each provision of this Agreement shall be --------------------- viewed as separate and divisible, and in the event that any such provisions shall be held to be invalid, the remaining provisions shall continue to be in full force and effect. 12.6 Notices. All notices, requests, demands and other communications ------- under this Agreement shall be in writing and shall be deemed to have been duly given and received on the date of service if personally served on the party to whom notice is to be given, or seventy-two (72) hours after mailing, if mailed to the party to whom notice is to be given by first class mail, postage prepaid, and properly addressed to the party at his address set forth on the signature pages of this Agreement, or any other address that any party may designate by written notice to the other parties. 12.7 Governing Law. This Agreement shall be construed in accordance with ------------- and governed by the laws of the State of Delaware. 12.8 Timing. Time is of the essence in the performance of all provisions ------ under this Agreement. 12.9 Counterparts. This Agreement may be executed in one or more ------------ counterparts, each of which shall be deemed an original, but all of which shall together constitute one and the same instrument. 12.10 Arbitration. The parties acknowledge and agree that time is of the ----------- essence in resolving any dispute that may arise in connection with this Agreement. Except as set forth herein, any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be settled by binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"). The expenses of the arbitration, including the arbitrators' fees, expert witness fees, and attorneys' fees, may be awarded to the prevailing party, in the discretion of the arbitrator, or may be apportioned among the parties in any manner deemed appropriate by the arbitrator. Unless and until the arbitrator decides that one party is to pay for all (or a share) of such expenses, each party to the dispute shall bear its own fees and costs arising in connection with enforcement of the Agreement. Not withstanding the foregoing, any parry may seek equitable enforcement of the term of this Agreement in any court of competent jurisdiction. 12.11 Legal Expenses. In the event that any party institutes a -------------- negotiation or proceeding to enforce the provisions of this Agreement, the prevailing party or parties in such negotiation or proceeding, whether such party or parties shall have instituted the negotiation or proceeding, shall be entitled to reasonable attorneys' fees in addition to costs and necessary disbursements. 12.12 Specific Performance. The parties hereby declare that it is -------------------- impossible to measure in money the damage which will accrue to a party hereto, or to the personal representative of a deceased Shareholder or Permitted Transferee by reason of a failure to perform any of the obligations provided for in this Agreement. If any party hereto or the personal representative of a deceased Shareholder or Permitted Transferee shall institute any negotiation or proceeding to enforce the provisions hereof, any person (including the Company) against whom such A-12 negotiation or proceeding is brought hereby waives any claim of defense therein based on an allegation that such party or such personal representative has or had an adequate remedy at law, and such person shall not urge in any such negotiation or proceeding the claim or defense that such remedy at law exists. 12.13 Confidentiality. The parties shall keep the terms of this Agreement --------------- confidential until a mutual agreement is reached regarding publicity or as otherwise required by law. 12.14 Shareholder Wills. Each Shareholder and Permitted Transferee agrees ----------------- to prepare and execute his last will and testament, and to include in such will or living trust a direction and authorization to the personal representative or trustee to comply with the provisions of this Agreement and to sell his Shares in accordance with this Agreement; however, the failure of any Shareholder or Permitted Transferee to do so shall not affect the validity or enforceability of this Agreement. 12.15 Effect of Headings; Constructions Exhibits. The subject headings of ------------------------------------------ the sections of this Agreement are included for purposes of convenience only, and shall not affect the construction or interpretation of any of its provisions. The parties acknowledge that each party and its counsel have reviewed and revised this Agreement, and 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, any exhibits hereto, or any documents executed in connection herewith. All exhibits to this Agreement are incorporated herein in their entirety. A-13 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first shown above. SHAREHOLDERS: COMPANY: COMPS InfoSystems, Inc. ______________________________________ Robert Beasley ______________________________________ By:_______________________________ Christopher Crane Its: President ------------------------------ SUMMIT SUMMIT VENTURES III, L.P. By: Summit Partners III, L.P. General Partner By: Stamps, Woodsum & Co. III, General Partner By:______________________________ General Partner SUMMIT INVESTORS II, L.P. By:______________________________ General Partner Address: 499 Hamilton Avenue, Suite 200 Palo Alto, CA 94301 (415) 321-1166 Additional Shareholders Agreeing to Join This Agreement ______________________________________ ______________________________________ ______________________________________ A-14 EXHIBIT "A" THIS NOTE HAS BEEN ISSUED IN PARTIAL PAYMENT OF THE PURCHASE BY THE UNDERSIGNED OF SHARES OF COMPS INFOSYSTEMS, INC., AND THE VALIDITY OF THIS NOTE MAY BE CONTROLLED BY, AND ENFORCEMENT AND PAYMENT PURSUANT TO THE TERMS HEREOF MAY BE AFFECTED BY, CHAPTER V OF THE GENERAL CORPORATION LAW OF THE STATE OF DELAWARE, OR THE LIMITATION SET FORTH IN THAT CERTAIN SHAREHOLDERS BUY-OUT AND VOTING AGREEMENT, DATED OCTOBER __-, 1994, OR BOTH. (For use only for Company repurchase.) PROMISSORY NOTE $________________ _______________, 19____ San Diego, California 1. FOR VALUE RECEIVED, ____________________ ("Payor") promises to pay to the order of ____________________, the principal sum of ________________ dollars ($_________________), with interest on the unpaid principal amount owing from time to time at the rate of ___________ percent (__%) per annum, compounded annually, commencing with the date hereof and continuing on the unpaid principal until paid. Principal shall be payable in 60 equal monthly installments commencing on the first day of the month next succeeding the date hereof. All accrued interest shall be payable with each principal payment. 2. All payments of interest and principal shall be in lawful money of the United States of America, payable on the due date by wire transfer or funds which are good and fully collectible at a bank or other financial institution in San Diego County, California. The holder of this Note shall specify the manner and place in San Diego County at which such payments are to be made. All payments shall be applied first to accrued interest, and thereafter to principal. Any delinquent installment of interest shall bear interest at the same rate as principal bears interest. Notwithstanding anything to the contrary contained in this Note, in no event shall the interest payable hereunder exceed the maximum amount of interest permissible under applicable law. 3. Upon receiving written approval of the holder of this Note, Payor may prepay this Note in whole or in part at any time or from time to time, without penalty or additional fees. 4. If any payment of principal or interest is not paid when due and continues unpaid for a period of five days after its scheduled due date, then at the option of the holder of this Note, this Note shall become due and payable in full upon the holder of this Note so notifying the Payor. 5. In the event of any default hereunder, Payor shall pay all reasonable attorneys' fees and court costs incurred by holder in enforcing and collecting this Note. 6. This note is secured in part by a Security Agreement of even date herewith. This Note remains a full recourse obligation of Payor. _____________________________ _____________________________ A-1 EXHIBIT "B" SECURITY AGREEMENT ------------------ This Security Agreement is entered into as of the ___ day of __________, 19__, by and between ____________ ("Debtor"), ______________ ("Creditor"), with respect to the following facts: A. Contemporaneously with the entering into of this Security Agreement, Debtor has purchased from Creditor _________ shares ("Shares") of the stock of COMPS InfoSystems, Inc., a Delaware corporation ("Corporation") for a total purchase price of $_________, of which $__________ has been paid in cash and the balance of $_________ is evidenced by a Promissory Note-("Note") executed by Debtor to Creditor of even date herewith. B. The parties hereto desire to secure the repayment of said Note with a pledge of said Shares. WHEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS: 1. Grant of Security Interest. Debtor hereby grants to Creditor ------------------------- a security interest pursuant to the Delaware Uniform Commercial Code in all of said Shares to secure the repayment of said Note and any and all obligations under this Security Agreement. 2. Perfecting Security Interest. Upon full payment of all ---------------------------- obligations of said Note and this Security Agreement, Pledgeholder shall immediately deliver the certificate or certificates representing said Shares to Debtor, or as Debtor otherwise instructs. There shall be no partial release of any of said Shares on account of part payment on said Note. 3. Default by Debtor. In the event of any default by Debtor ----------------- under said Note or this Security Agreement, if said default is not cured within ten (10) days after Creditor has delivered written notice of such default to Debtor, Creditor shall be entitled to declare the full amount of unpaid principal and interest owed by Debtor immediately due and payable, to take legal action to collect such amounts, and to exercise any and all rights and remedies available to Creditor as the secured party under the Delaware Commercial Code, including without limitation, the right to take said Shares in full repayment of said Note, the right to sell said Shares at public or private sale, and the right to recover from Debtor any deficiency if the net proceeds from such sale are less than the unpaid balance owed under said Note. 4. Recapitalization of the Corporation. In the event of any ----------------------------------- recapitalization of the Corporation, whether by stock split, merger, consolidation, sale of assets, exchange of stock, or any other manner whatsoever, Creditor's security interest as set forth herein shall automatically without need of any further action attach to the stock or property into which said Shares have been converted. 5. Rights of Shareholder. So long as no default occurs under --------------------- said Note or this Security Agreement, Debtor shall be entitled to receive all dividends paid on said Shares, to vote said Shares in all matters, and to otherwise be entitled to all rights of ownership of said Shares; provided, however, notwithstanding the foregoing, that Creditor shall retain B-1 possession of said Shares and any transfer or grant of a security interest in said Shares by Debtor shall at all times remain subject and subordinate to Creditor's prior security interest, and provided further, that Debtor shall not vote said Shares for any plan to terminate, liquidate, dissolve, merge, consolidate, reorganize, or otherwise alter the form of the Corporation, or to authorize any stock dividends or to alter or amend the Articles of Incorporation, without first receiving prior written consent from Creditor. 6. Expenses of Litigation. In the event of any default under ---------------------- said Note or this Security Agreement, Debtor agrees to pay to Creditor all of Creditor's costs, including the reasonable attorneys' fees and court costs incurring in enforcing this Security Agreement and collecting said Note. 7. Securities Laws. The Debtor acknowledges that the various --------------- federal and state securities laws may prohibit or prevent the advertising for sale of the Shares as required by a public sale as described in Paragraph 3 hereof. Therefore, the Debtor consents to a private sale by the Creditor upon the occurrence of an event of default and expressly acknowledges that such a private sale is commercially reasonable, given the nature and circumstances of the transaction contemplated by this Agreement. 8. Miscellaneous. The rights of the Creditor hereunder shall ------------- inure to the benefit of its successors and assigns, and the obligations of the Debtor hereunder shall bind its successors and assigns. IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the date set forth above. ___________________________________ DEBTOR ___________________________________ CREDITOR B-2 EXHIBIT G Restated Certificate RESTATED CERTIFICATE OF INCORPORATION OF COMPS INFOSYSTEMS, INC. The undersigned, Christopher A. Crane and Robert C. Beasley, hereby certify that: A. They are the duly elected and acting President and Secretary, respectively, of COMPS InfoSystems, Inc., a Delaware corporation (the "Corporation"). B. The original Certificate of Incorporation of the Corporation was filed with the Secretary of State on September 1, 1994. C. The Certificate of Incorporation is restated to read in full as follows: FIRST: The name of the Corporation is COMPS InfoSystems, Inc. (hereinafter ----- sometimes referred to as the "Corporation"). SECOND: The address of the registered office of the Corporation in the ------ State of Delaware is 32 Loockerman Square, Suite L-100, Dover, Delaware 19904. The name of the registered agent at that address is The Prentice-Hall Corporation System, Inc. THIRD: The purpose of the Corporation is to engage in any lawful act or ----- activity for which a corporation may be organized under the General Corporation Law of Delaware. FOURTH: The Corporation is authorized to issue two classes of shares to be ------ designated respectively "Preferred Stock" and "Common Stock." The total number of shares of Preferred Stock, par value $.01 per share, which are authorized is 5,000,000. The total number of shares of Common Stock, par value $.01 per share, which are authorized is 25,000,000. Upon the filing of this Restated Certificate of Incorporation, each of this Corporation's outstanding shares is split up and converted into one hundred (100) shares of Class A Common Stock, as herein defined. A. Common Stock. The first series of Common Stock shall be comprised of ------------ 22,500,000 shares designated "Class A Common Stock." The second series of Common Stock shall be comprised of 2,500,000 shares of Common Stock designated "Class B Common Stock." The Class A and Class B Common Stock shall have the same rights and privileges except as provided below: 1. Voting. The Class B Common Stock shall not have any right to ------ vote unless otherwise required by law. 2. Conversion. Each share of Class B Common Stock shall ---------- automatically convert into one share of Class A Common Stock upon the earlier to occur of (i) the time the -1- consent of at least 66 2/3% of the outstanding Class A Common Stock to such conversion is obtained, or (ii) closing of the sale of the Corporation's securities pursuant to an underwritten public offering. Upon conversion of the Class B Common Stock, the Class A Common Stock shall be renamed "Common Stock." (a) In case the Corporation shall at any time (i) subdivide the outstanding Class A Common Stock, or (ii) issue a stock dividend on its outstanding Class A Common Stock, the number of shares of Class B Common Stock issuable upon conversion of the Class B Common Stock immediately prior to such subdivision or the issuance of such stock dividend shall be proportionately increased by the same ratio as the subdivision or dividend. In case the Corporation shall at any time combine its outstanding Class A Common Stock, the number of shares of Class B Common Stock issuable upon conversion of the Class B Common Stock immediately prior to such combination shall be proportionately decreased by the same ratio as the combination. All such adjustments described herein shall be effective at the close of business on the date of such subdivision, stock dividend or combination, as the case may be. (b) In case of any capital reorganization (other than in connection with a merger or other reorganization which the Corporation is not the continuing or surviving entity) or any reclassification of the Common Stock of the Corporation, the Class B Common Stock shall thereafter be convertible into that number of shares of stock or other securities or property to which a holder of the number of shares of Class A Common Stock of the Corporation deliverable upon conversion of the shares of Class B Common Stock immediately prior to such reorganization or recapitalization would have been entitled upon such reorganization or reclassification. B. Preferred Stock. The first series of Preferred Stock shall be --------------- comprised of 4,270,336 shares designated as "Series A Preferred Stock." The relative rights, preferences, restrictions and other matters relating to the Series A Preferred Stock are as follows: 1. Dividend Rights of Preferred. The holders of Preferred Stock ---------------------------- shall be entitled to receive, out of any assets at the time legally available therefore, cumulative noncompounded dividends from the date of issuance at the rate per annum of $0.07025 per share (subject to adjustments for stock splits, dividends, recapitalization and the like) of Series A Preferred Stock, payable immediately prior to the effective time of (i) any repurchase of the Series A Preferred Stock; (ii) any liquidation pursuant to Section B(2)(b) of this Article FOURTH; or (iii) any sale of the Corporation's securities pursuant to an underwritten public offering; provided, however, that the right to receive such -------- ------- accrued and unpaid dividends shall be forfeited in the event of (x) a repurchase of all of the outstanding Series A Preferred stock or a liquidation pursuant to Section B(2)(b) of this Article FOURTH, if the aggregate amount to be received by the holders of the Series A Preferred Stock prior to the payment of such accrued and unpaid dividends would exceed $3.52 per share (as adjusted for stock-splits, combinations, reorganizations and the like) or (y) an underwritten public offering of the Corporation's securities if the Corporation receives gross proceeds of not less than $10,000,000 at a purchase price of not less than $3.52 per share (as adjusted for stock splits, stock dividends, reorganizations and the like). Upon conversion of the Series A Preferred Stock any accrued but unpaid dividends shall remain accrued and shall remain payable pursuant to this Section B(l) of this Article FOURTH. In addition to the cumulative dividends specified above, no cash -2- dividends shall be paid on any Common Stock unless an equal dividend is paid with respect to all outstanding shares of Preferred Stock in an amount for each such share of Preferred Stock equal to the aggregate amount of such dividends for all Common Stock into which each such share of Preferred Stock could then be converted. 2. Preference on Liquidation. ------------------------- (a) In the event of any liquidation, dissolution or winding up of the Corporation, distributions to the stockholders of the Corporation shall be made in the following manner: (i) The holders of the Preferred Stock shall be entitled to receive, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to the holders of the Common Stock by reason of their ownership of such stock, the amount of (A) $1.17087 per share for each share of Series A Preferred Stock then held by them, adjusted for any stock split, combination, consolidation, or stock distributions or stock dividends with respect to such shares, and (B) an amount equal to all accumulated but unpaid dividends on the Preferred Stock as provided in Subsection 1 above. If the assets and funds thus distributed among the holders of the Preferred Stock shall be insufficient to permit the payment to such holders of the full aforesaid preferential amount, then the entire assets and funds of the Corporation legally available for distribution shall be distributed ratably among the holders of the Preferred Stock in proportion to their aggregate preferential amounts. (ii) The remaining assets of the Corporation, after payment in full to the holders of Preferred Stock of all amounts exclusively payable on or with respect to said shares, shall be distributed ratably among the holders of the Common Stock. (b) The following shall be deemed to be a liquidation, dissolution or winding up within the meaning of this Subsection: (i) an acquisition, consolidation or merger of this Corporation with or into any other corporation or corporations unless the stockholders of the Corporation prior to such transaction directly or indirectly own more than fifty percent (50%) of the voting stock of the surviving or acquiring corporation or corporations; (ii) the sale, transfer or other disposition of all or substantially all of the assets of this Corporation to a person other than a corporation or partnership controlled by the Corporation or its stockholders; and (iii) the effectuation by the Corporation of a transaction or series of related transactions in which more than 50% of the outstanding voting power of the Corporation prior to such transaction or series of related transactions is disposed of. (c) In the event the Corporation shall propose to take any action of the type described in subsection (a) or (b) of this Subsection 2, the Corporation shall, within ten (10) days after the date the Board of Directors approves such action or twenty (20) days prior to any stockholders' meeting called to approve such action, whichever is earlier, give each holder of shares of the Preferred Stock written notice of the proposed action. Such written notice shall describe the material terms and conditions of such proposed action, including a description of the stock, cash and property to be received by the holders of shares of the Preferred Stock upon consummation of the proposed action and the proposed date of delivery thereof. If any material -3- change in the facts set forth in the notice shall occur, the Corporation shall promptly give written notice to each holder of shares of the Preferred Stock of such material change. (d) The Corporation shall not consummate any proposed action of the type described in subsection (a) or (b) of this Subsection 2 before the expiration of thirty (30) days after the mailing of the initial written notice or ten (10) days after the mailing of any subsequent written notice, whichever is later; provided, however, that any such 30-day or 10-day period may be shortened upon the written consent of the holders of a majority of the outstanding shares of the Preferred Stock. (e) If the Corporation shall propose to take any action of the type described in subsection (a) or (b) of this Subsection 2 which will involve the distribution of assets other than cash, the Corporation shall, if requested by the holders of a majority of the Preferred Stock, promptly engage independent competent appraisers to determine the value of the assets to be distributed to the holders of shares of the Preferred Stock and the Common Stock. The Corporation shall, upon receipt of such appraiser's valuation, give prompt written notice of the appraiser's valuation to each holder of shares of the Preferred Stock. 3. Voting. ------ (a) Except as set forth in paragraph (b) of this Subsection 3 and in Subsection 6 hereof, or as otherwise required by law, the shares of the Preferred Stock shall be voted together with the Corporation's Class A Common Stock at any annual or special meeting of the stockholders of the Corporation, or may act by written consent in the same manner as the Corporation's Class A Common Stock, and shall have the voting rights and powers equal to the voting rights of the Class A Common Stock, upon the following basis: each holder of shares of Preferred Stock shall be entitled to such number of votes for the Preferred Stock held by him on the record date fixed for such meeting, or, if no record date is established, at the date such vote is taken or on the effective date of any such written consent, as shall be equal to the nearest whole number of shares of the Corporation's Common Stock into which his shares of Preferred Stock are convertible immediately after the close of business on the record date fixed for such meeting, the date of such vote or the effective date of such written consent. (b) The holders of Series A Preferred Stock, voting as a separate class, shall be entitled to elect one director. The election of a director by the Series A Preferred Stock shall occur at the annual meeting of holders of Common Stock or at any special meeting of holders of Series A Preferred Stock called by holders of a majority of the outstanding shares of Series A Preferred Stock or by the written consent of all such holders. If the person elected by the holders of Series A Preferred Stock should cease to be a director for any reason, the vacancy shall only be filled by the vote or written consent of holders of a majority of the outstanding shares of Series A Preferred Stock. The holders of the Common Stock shall be entitled to elect the remaining directors. 4. Status of Converted or Redeemed Stock. In the event that any ------------------------------------- shares of Preferred Stock shall be converted pursuant to Subsection 5 hereof or shall be repurchased or otherwise acquired by the Corporation in any manner whatsoever, such shares shall be retired and canceled promptly after the acquisition thereof. Such shares shall not be reissued as shares -4- of Series A Preferred Stock or shares of any other series of Preferred Stock. Upon such cancellation, and upon the filing of any certificates required or appropriate under applicable law, the number of authorized shares of Preferred Stock as set forth in Article FOURTH, shall be reduced by the number of such shares so canceled. 5. Conversion Rights. The holders of Preferred Stock shall have ----------------- conversion rights as follows: (a) Each share of Preferred Stock shall be convertible, at the option of the holder thereof, at any time at the principal office of the Corporation or any transfer agent for such shares, into fully paid and nonassessable shares of Class A Common Stock of the Corporation. The number of shares of Class A Common Stock into which each share of Preferred Stock may be converted shall be determined by dividing $1.17087 for the Series A Preferred Stock by the Conversion Price determined as hereinafter provided in effect at the time of the conversion. The Conversion Price per share at which shares of Class A Common Stock shall be initially issuable upon conversion of any shares of Preferred Stock shall be $1.17087 for the Series A Preferred Stock, subject to adjustment as provided herein. (b) Each share of Preferred Stock shall be converted into Class A Common Stock automatically in the manner provided herein upon the earlier to occur of (i) the time the consent of at least 66-2/3% of the outstanding Preferred Stock to such conversion is obtained, or (ii) the closing of the sale of the Corporation's securities pursuant to an underwritten public offering from which the Corporation receives gross proceeds of not less than $10,000,000 at a purchase price of not less than $3.52 per share (as adjusted for stock splits, stock dividends, reorganizations and the like). (c) Before any holder of Preferred Stock shall be entitled to convert the same into Common Stock, such holder shall surrender the certificate or certificates therefor, duly endorsed in blank or accompanied by proper instruments of transfer, at the principal office of the Corporation or of any transfer agent for the Preferred Stock, and shall give written notice to the Corporation at such office that such holder elects to convert the same and shall state in writing therein the name or names in which such holder wishes the certificate or certificates for Common Stock to be issued. As soon as practicable thereafter, the Corporation shall issue and deliver at such office to such holder's nominee or nominees, certificates for the number of whole shares of Common Stock to which such holder shall be entitled. No fractional shares of Common Stock shall be issued by the Corporation and all such fractional shares shall be disregarded. In lieu thereof, the corporation shall pay in cash the fair market value of such fractional share as determined by the Board of Directors of the Corporation. Such conversion shall be deemed to have been made as of the date of such surrender of the Preferred Stock to be converted, and the person or persons entitled to receive the Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such Common Stock on said date. (d) In case the Corporation shall at any time (i) subdivide the outstanding Common Stock, or (ii) issue a stock dividend on its outstanding Common Stock, the number of shares of Common Stock issuable upon conversion of the Preferred Stock immediately prior to such subdivision or the issuance of such stock dividend shall be -5- proportionately increased by the same ratio as the subdivision or dividend (with appropriate adjustments in the Conversion Price of the Preferred Stock). In case the Corporation shall at any time combine its outstanding Common Stock, the number of shares of Common Stock issuable upon conversion of the Preferred Stock immediately prior to such combination shall be proportionately decreased by the same ratio as the combination (with appropriate adjustments in the Conversion Price of the Preferred Stock). All such adjustments described herein shall be effective at the close of business on the date of such subdivision, stock dividend or combination, as the case may be. (e) In case of any capital reorganization (other than in connection with a merger or other reorganization in which the Corporation is not the continuing or surviving entity) or any reclassification of the Common Stock of the Corporation, the Preferred Stock shall thereafter be convertible into that number of shares of stock or other securities or property to which a holder of the number of shares of Common Stock of the Corporation deliverable upon conversion of the shares of Preferred Stock immediately prior to such reorganization or recapitalization would have been entitled upon such reorganization or reclassification. In any such case, appropriate adjustment (as determined by the Board of Directors) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of Preferred Stock, such that the provisions set forth herein shall thereafter be applicable, as nearly as reasonably may be, in relation to any share of stock or other property thereafter deliverable upon the conversion. (f) In case: (i) the Corporation shall take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend, or any other distribution, payable otherwise than in cash; or (ii) the Corporation shall take a record of the holders of its Common Stock for the purpose of entitling them to subscribe for or purchase any shares of stock of any class or to receive any other rights; or (iii) the Corporation shall effect a capital reorganization of the Corporation, reclassification of the capital stock of the Corporation (other than a subdivision or combination of its outstanding Common Stock), consolidation or merger of the Corporation (other than a merger or other reorganization in which the Corporation is not the continuing or surviving entity); then, and in any case, the Corporation shall cause to be mailed to the holders of its Preferred Stock, at least twenty (20) days prior to the date hereinafter specified, a notice stating the date on which a record is to be taken for the purpose of such dividend, distribution or rights, or such action is to be taken in connection with such reorganization, reclassification, merger or consolidation. (g) The Corporation shall at all times reserve and keep available, out of its authorized but unissued Common Stock, solely for the purpose of effecting the conversion of the Preferred Stock, the full number of shares of Common Stock deliverable upon the conversion of all Preferred Stock from time to time outstanding. The Corporation shall from time to time (subject to obtaining necessary director and stockholder action), in accordance with -6- the laws of the State of Delaware, increase the authorized amount of its Common Stock if at any time the authorized number of shares of Common Stock remaining unissued shall not be sufficient to permit the conversion of all of the shares of Preferred Stock at the time outstanding. (h) Upon the issuance by the Corporation of Common Stock, or any right or option to purchase Common Stock, or any obligation or any shares of stock convertible into or exchangeable for Common Stock for a consideration per share less than the Conversion Price of the Series A Preferred Stock in effect immediately prior to the time of such issue or sale other than the issuance of shares of Common Stock upon conversion of any Series A Preferred Stock, then forthwith upon such issue or sale, the Conversion Price of the Series A Preferred Stock shall be reduced to a price (calculated to nearest cent) by dividing: (i) an amount equal to the sum of (x) the number of shares of Common Stock outstanding immediately prior to such issue or sale multiplied by the then existing Conversion Price of the Series A Preferred Stock, (y) the number of shares of Common Stock issuable upon conversion of any shares of stock of the Corporation outstanding immediately prior to such issue or sale multiplied by the then existing Conversion Price of the Series A Preferred Stock, and (z) an amount equal to the aggregate consideration received by the Corporation upon such issue or sale by, (ii) the sum of the number of shares of Common Stock outstanding immediately after such issue or sale and the number of shares of Common Stock (without taking into account any adjustment in such number resulting from such issue or sale) issuable upon conversion of any shares of stock of the Corporation outstanding immediately after such issue or sale. For purposes of this subsection (h) the following provisions shall be applicable: (1) In the case of an issue or sale for cash of shares of Common Stock, the consideration received by the Corporation therefor shall be deemed to be the amount of cash received, before deducting therefrom any commissions or expenses paid or incurred by the Corporation. (2) In case of the issuance (otherwise than upon conversion or exchange of obligations or shares of stock of the Corporation) of additional shares of Common Stock for a consideration other than cash or a consideration partly other than cash, the amount of the consideration other than cash received by the Corporation for such shares shall be deemed to be the value of such consideration as reasonably determined by the Board of Directors. (3) In case of the issuance by the Corporation in any manner of any rights to subscribe for or to purchase shares of Common Stock, at a consideration per share (as computed below) less than the Conversion Price in effect for the Series A Preferred Stock immediately prior to the date of the offering of such rights or the granting of such options, as the case may be, the maximum number of shares of Common Stock to which the holders of such rights or options shall be entitled to subscribe for or purchase pursuant to such rights or options shall be deemed to be issued or sold as of the date of the offering of such rights or the -7- granting of such options, as the case may be, and the minimum aggregate consideration named in such rights or options for the shares of Common Stock covered thereby, plus the consideration, if any, received by the Corporation for such rights or options, shall be deemed to be the consideration actually received by the Corporation (as of the date of the offering of such rights or the granting of such options, as the case may be) for the issuance of such shares. (4) In case of the issuance or issuances by the Corporation in any manner of any obligations or of any shares of stock of the Corporation that shall be convertible into or exchangeable for Common Stock, at a consideration per share (as computed below) less than the Conversion Price in effect for the Series A Preferred Stock immediately prior to the date such obligation or shares are issued, the maximum number of shares of Common Stock issuable upon the conversion or exchange of such obligations or shares shall be deemed issued as of the date such obligations or shares are issued, and the amount of the consideration received by the Corporation for such additional shares of Common Stock shall be deemed to be the total of the amount of consideration received by the Corporation upon the issuance of such obligations or shares, as the case may be, plus the minimum aggregate consideration, if any, other than such obligations or shares, receivable by the Corporation upon such conversion or exchange, except in adjustment of dividends. (5) The amount of the consideration received by the Corporation upon the issuance of any rights or options referred to in subsection (3) above or upon the issuance of any obligations or shares which are convertible or exchangeable as described in subsection (4) above, and the amount of the consideration, if any, other than such obligations or shares so convertible or exchangeable, receivable by the Corporation upon the exercise, conversion or exchange thereof shall be determined in the same manner provided in subsections (h)(1) and (2) above with respect to the consideration received by the Corporation in case of the issuance of additional shares of Common Stock. On the expiration of any rights or options referred to in subsection (3), or the termination of any right of conversion or exchange referred to in subsection (4), the Conversion Price then in effect for the Series A Preferred Stock shall forthwith be readjusted to such Conversion Price as would have obtained had the adjustments made upon the issuance of such option, right or convertible or exchangeable securities been made upon the basis of the delivery of only the number of shares of Common Stock actually delivered upon the exercise of such rights or options or upon the conversion or exchange of such securities. (6) Anything herein to the contrary notwithstanding, the Corporation shall not be required to make any adjustment of the Conversion Price in the case of (A) the sale and issuance by the Corporation of up to 811,160 shares of Common Stock or rights or options to purchase shares of Common Stock, net of repurchases and expired or canceled options, (as adjusted for stock splits, stock dividends, reorganizations and the like) to officers, directors, employees and consultants of the Corporation; (B) the issuance of Common Stock upon the conversion of outstanding Series A Preferred Stock; or (C) the issuance of up to 379,869 shares of Common Stock upon the exercise of Warrants issued to the holders of Series A Preferred Stock. (i) Upon the occurrence of each adjustment or readjustment of the Conversion Price for any series of Preferred Stock pursuant to this Subsection 5, the Corporation -8- at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to each holder of Preferred Stock a certificate setting forth such adjustment or readjustment showing in detail the facts upon which such adjustment or readjustment is based. The Corporation shall, upon the reasonable written request at any time of any holder of Preferred Stock, furnish or cause to be furnished to such holder a like certificate setting forth (i) such adjustments and readjustments, and (ii) the number of shares of Common Stock and the amount, if any, of other property which at the time would be received upon the conversion of the Preferred Stock. (j) In the event the Corporation at any time or from time to time makes, or fixes a record date for the determination of holders of Common Stock entitled to receive any distribution payable in securities or other property of the Corporation other than Common Stock and other than as otherwise adjusted in this Subsection 5, then and in each such event provision shall be made so that the holders of Preferred Stock shall receive upon conversion thereof, in addition to the number of shares of Common Stock receivable thereupon, the amount of securities and other property of the Corporation which they would have received had their shares of Preferred Stock been converted into shares of Common Stock on the date of such event and had they thereafter, during the period from the date of such event to and including the date of conversion, retained such securities and other property receivable by them as aforesaid during such period, subject to all other adjustments called for during such period under this Subsection 5 with respect to the rights of the holders of Preferred Stock. (k) Any notices required by the provisions of this Subsection 5 to be given to the holders of shares of Preferred Stock shall be deemed given if deposited in the United States mail, first class, postage prepaid and addressed to each holder of record at its address appearing on the books of the Corporation. 6. Changes. So long as shares of Series A Preferred Stock are ------- outstanding, the Corporation shall not, without first obtaining the approval by vote or written consent, in the manner provided by law, of the holders of at least a majority of the total number of shares of Series A Preferred Stock outstanding, voting separately as a class: (1) alter or change any of the powers, preferences, privileges or rights of the Series A Preferred Stock; (2) increase the authorized number of shares of Preferred Stock; (3) amend the provisions of this Section 6; (4) undertake or effect any consolidation or merger of the Corporation with or into another corporation or any acquisition by or the conveyance of all or substantially all of the assets of the Corporation to another person; (5) create any new series of Preferred Stock; (6) amend this Certificate of Incorporation of the Corporation; (7) declare or pay any dividends on the Corporation's capital stock; (8) redeem or repurchase any outstanding stock other than (i) from employees, consultants or directors upon the termination of their employment or services pursuant to agreements providing for such repurchases; and (ii) up to 1,708,140 shares of Common Stock to be repurchased on or before October 31, 1994; or (9) increase the size of the Board of Directors to more than four directors. FIFTH: The following provisions are inserted for the management of the ----- business and the conduct of the affairs of the Corporation, and for further definition, limitation and regulation of the powers of the Corporation and of its directors and stockholders: -9- A. The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. In addition to the powers and authority expressly conferred upon them by statute or by this Certificate of Incorporation or the By-Laws of the Corporation, the directors are hereby empowered to exercise all such powers and do all such acts and things as may be exercised or done by the Corporation. B. The directors of the Corporation need not be elected by written ballot unless the By-Laws so provide. SIXTH: ----- A. The number of directors shall initially be four (4) and, thereafter, subject to the rights of the holders of any outstanding series of Preferred Stock, shall be fixed from time to time exclusively by the Board of Directors pursuant to a resolution adopted by a majority of the total number of authorized directors (whether or not there exist any vacancies in previously authorized directorships at the time any such resolution is presented to the Board for adoption). Subject to the rights of the holders of any series of Preferred Stock then outstanding, a vacancy resulting from the removal of a director by the stockholders as provided in Article SIXTH, Section C below may be filled at a special meeting of the stockholders held for that purpose. All directors shall hold office until the expiration of the term for which elected, and until their respective successors are elected, except in the case of the death, resignation, or removal of any director. B. Subject to the rights of the holders of any series of Preferred Stock then outstanding, newly created directorships resulting from any increase in the authorized number of directors or any vacancies in the Board of Directors resulting from death, resignation or other cause (other than removal from office by a vote of the stockholders) may be filled only by a majority vote of the directors then in office, though less than a quorum, and directors so chosen shall hold office for a term expiring at the next annual meeting of stockholders at which the term of office of the class to which they have been elected expires, and until their respective successors are elected, except in the case of the death, resignation, or removal of any director. No decrease in the number of directors constituting the Board of Directors shall shorten the term of any incumbent director. C. Subject to the rights of the holders of any series of Preferred Stock then outstanding, any directors, or the entire Board of Directors, may be removed from office at any time, with or without cause, but only by the affirmative vote of the holders of at least a majority of the voting power of all of the then outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class. Vacancies in the Board of Directors resulting from such removal may be filled by a majority of the directors then in office, though less than a quorum, or by the stockholders as provided in Article SIXTH, Section A above. Directors so chosen shall hold office for a term expiring at the next annual meeting of stockholders at which the term of office of the class to which they have been elected expires, and until their respective successors are elected, except in the case of the death, resignation, or removal of any director. -10- SEVENTH: The Board of Directors is expressly empowered to adopt, amend or ------- repeal By-Laws of the Corporation. Any adoption, amendment or repeal of By-Laws of the Corporation by the Board of Directors shall require the approval of a majority of the total number of authorized directors (whether or not there exist any vacancies in previously authorized directorships at the time any resolution providing for adoption, amendment or repeal is presented to the Board). The stockholders shall also have power to adopt, amend or repeal the By-Laws of the Corporation. Any adoption, amendment or repeal of By-Laws of the Corporation by the stockholders shall require, in addition to any vote of the holders of any class or series of stock of the Corporation required by law or by this Certificate of Incorporation, the affirmative vote of the holders of at least sixty-six and two-thirds percent (66-2/3%) of the voting power of all of the then outstanding shares of the capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class. EIGHTH: A director of the Corporation shall not be personally liable to ------ the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involved intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law, or (iv) for any transaction from which the director derived an improper personal benefit. If the Delaware General Corporation Law is hereafter amended to authorize the further elimination or limitation of the liability of a director, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the Delaware General Corporation Law, as so amended. Any repeal or modification of the foregoing provisions of this Article EIGHTH by the stockholders of the Corporation shall not adversely affect any right or protection of a director of the Corporation existing at the time of such repeal or modification. NINTH: The Corporation shall, to the fullest extent permitted by Section ----- 145 of the General Corporation Law of the State of Delaware, as the same may be amended and supplemented, indemnify any and all persons whom it shall have power to indemnify under said section from and against any and all of the expenses, liabilities or other matters referred to in or covered by said section, and the indemnification provided for herein shall not be deemed exclusive of any other rights to which those indemnified may be entitled under by bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such person. TENTH: The Corporation reserves the right to amend or repeal any provision ----- contained in this Certificate of Incorporation in the manner prescribed by the laws of the State of Delaware and all rights conferred upon stockholders are granted subject to this reservation; provided, however, that, notwithstanding -------- ------- any other provision of this Certificate of Incorporation or any provision of law which might otherwise permit a lesser vote or no vote, but in addition to any vote of the holders of any class or series of the stock of this Corporation required by law or by this Certificate of Incorporation, the affirmative vote of the holders of at least 66-2/3% of the -11- voting power of all of the then outstanding shares of the capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class, shall be required to amend or repeal this Article TENTH, Article FIFTH, Article SIXTH, Article SEVENTH, Article EIGHTH, or Article NINTH. The foregoing Restated Certificate of Incorporation has been approved by the Board of Directors of the Corporation. The foregoing Restated Certificate of Incorporation has been approved by the outstanding shares of the Corporation in accordance with Sections 242 and 245 of the Delaware General Corporation Law. -12- IN WITNESS WHEREOF, the Corporation has caused this Certificate to be signed by Christopher A. Crane, its President, and attested to by Robert C. Beasley, its secretary, on October ___, 1994. _____________________________________________ Christopher A. Crane, President ATTEST: _____________________________________________ Robert C. Beasley, Secretary -13- EXHIBIT H Schedule of Contracts SCHEDULE H ---------- Material Contracts Attached Agreements with Officers, Directors, Stockholders, Consultants, Employees. 1. Employment Agreements with each of the following: a. Chris Crane b. Karen Goodrum* c. Craig Farrington* d. Chris Fenton* e. David Webb* f. Lori Reisinger* g. Robert Beasley* 2. Confidentiality and Proprietary Information Agreements with all employees, except those employees listed on Exhibit 3.8 to Exhibit B. 3. Indemnification Agreements with all Directors and the following officers: a. Chris Crane* b. Karen Goodrum* c. Craig Farrington* d. Chris Fenton* e. David Webb* f. Lori Reisinger* g. Robert Beasley* 4. Stockholder Buy-out and Voting Rights Agreement dated as of October 14, 1994 among the Company, Beasley, Crane and Summit. 5. $79,294 loans from the Company to Beasley, which are payable October, 1994 and are expected to be repaid by Beasley with proceeds he receives when the Company repurchases certain of his Shares. 6. $190,000 loan from the Company to Beasley, which is expected to be forgiven immediately after the Closing. 7. Non-compete Agreement between the Company and Beasley. _____________ * Form of agreement has been provided to Summit. It is anticipated that the actual agreements will be executed shortly after the closing. 4 Business Real Estate Information Corp. Leases, Contracts, Commitments Page 2 EQUIPMENT LEASES (Cont') - ---------------- Ford Motor Corp. Acct. No. FN A321 335R Term: 48 months Start: 01/26/94 Vehicle: FORD Escort 1993 Lease Payment: $277.30/month Original Loan: $12,305.65 G.E. Capital Lease No. 6519146-001 Term: 60 Months Start: 5/16/94 Equipment: Executone Telephone Equipment Lease Payment: $1,521.89/month Original Loan: $64,805.00 Avnet/AT&T Capital Corporation Lease No. Term: 60 months Start: 07/25/94 Equipment: HP 9000 Computer Lease Payment: $744.57/ month Original Loan: $32.121.40 Sybuse Financial Services, Inc. Agreement # 509662 Term: 36 months Start: 7/15/94 Equipment: Sybase Software Lease Payment: $916.91/month Original Loan: $26,120.00 Sybase Financial Services, Inc. Agreement # Term: 36 months Start: 10/21/94 Equipment: Sybuse Software Term Payment: $1,025.39/month Original Loan: $29,255.00 Business Real Estate Information Corp. Leases, Contracts, Commitments Page 3 EQUIPMENT LEASES (Cont') - ---------------- Canon Financial Service Lease No. 001-0050913-001 Term: 60 Months Start: 09/20/94 Equipment: 3 Canon Copiers Lease Payment: $457.18/month Original Loan: $20,628.00 OFFICE LEASES - ------------- Lessor: Mutual Benefit Life Insurance Co. c/o Vestar Property Management Lease Address: 5060 N. 40th Street #111 Phoenix, AZ 95018 Start: 11/15/93 Term: 49 months Effective Rent: $1,109.63/month Lessor: Hugh W. Klebahn as Trustee for the Jane K. Molyneux Trust c/o Hanford, Freund & Company Lease Address: 870 Mitten Road Burlingame, CA 94010 Start: 05/01/94 Term: 64 months Effective Rent: $2,967.00/month Lessor: COMPS Plaza Associates, Ltd. c/o McKellar Properties Lease Address: 9888 Carroll Centre Road San Diego, CA 92126 Start: 07/01/94 Term: 96 months Effective Rent/Month: $22,287.00* *Reflects $4.00/sf tenant improvement expense; TI expense above that amount will be amortized over the life of the lease at an additional amount or approximately $1,800 - $2,000 per month. Business Real Estate Information Corp. Leases, Contracts, Commitments Page 4 OFFICE LEASES (Cont') - ------------- Lessor: Suite 900 Associates Lease Address: 7799 Leesburg Pike, Suite 900N Falls Church, VA 22043 Start: 11/01/94 Term: 6 months Effective Rent/Month: $825.00 NOTES RECEIVABLE - ---------------- Robert C. Beasley 3411-A Reynard Way San Diego, CA 92103 $75,294.04 Robert C. Beasley 3411-A Reynard Way San Diego, CA 92103 $83,837.15 Robert C. Beasley 341 1-A Reynard Way San Diego, CA 92103 $116,038.00 CONTRACTS - --------- DataQuick Information Systems 9171 Town Centre Drive, Suite 600 San Diego, CA 92122 Don Cohn, President (619) 455-6900 Insurance Services Office, Inc. (ISO) 7 World Trade Centre New York, NY 10048 Carole Banfield, Senior Vice President Business Real Estate Information Corp. Leases, Contracts, Commitments Page 5 CONTRACTS (Con't) - --------- Grubb & Ellis 500 N. State College Blvd., #100 Orange, CA 92668 Contact: John Allen Contract Amount: $25,000.00 BANKING RELATIONSHIPS - --------------------- Bank: Union Bank 7907 Girard Avenue La Jolla, CA 92037 Randall T. Vogan, Commercial Loan Officer (619) 551-4764 Current Facility ---------------- Current Line of Credit: Renews 11/01/94 Total Amount: $ 90,000.00 Total Available $ 90,000.00 Term Loan: Total Amount $175,000.00 Advances: $134,076.87 Amount Available: $ 40,923.13 Requested Facility ------------------ Line of Credit: $300,000.00 Term Loan: $460,000.00 EXHIBIT I Voting Agreement VOTING AGREEMENT ---------------- THIS VOTING AGREEMENT (the "Agreement") is entered into as of October 14, 1994, by and among COMPS InfoSystems, Inc., a Delaware corporation (the "Company"), Christopher A. Crane ("Crane"), and the purchasers (the "Purchasers") of Series A Preferred Stock of the Company pursuant to the Stock and Warrant Purchase Agreement dated as of even date herewith (the "Stock and Warrant Purchase Agreement"). RECITALS -------- 1. Crane is the holder of a majority of the Company's Common Stock. The Purchasers are the holders of all of the Company's Series A Preferred Stock. 2. As an inducement to the Purchasers to purchase the Series A Preferred Stock of the Company, Crane is executing this Agreement. As an inducement to Crane to execute this Agreement, the Purchasers are executing this Agreement. AGREEMENT --------- NOW, THEREFORE, the parties hereto agree as follows: 1. Voting of Shares. Until the termination of this Agreement in ---------------- accordance with Section 4 below, Crane will vote all shares of Common Stock of the Company then within his control, at any annual or special meeting of the stockholders of the Company, or in any action by written consent of the stockholders of the Company in order to cause and maintain the election to the Board of Directors of one director to be elected by the holders of the Company's Common Stock who is mutually acceptable to Crane and the Purchasers holding a majority of the outstanding Series A Preferred Stock. A nominee shall be deemed to be acceptable to the Purchasers if they have consented in writing to his or her election. 2. Legends on Stock Certificates. The certificates representing shares ----------------------------- held by Crane shall bear the following legend: "The shares represented by this certificate are subject to the limitations, restrictions and other terms and conditions of a Voting Agreement dated October 14, 1994, on file with the Company." 3. Application of Agreement to After-Acquired Shares. All of the ------------------------------------------------- provisions of this Agreement shall apply to, and the term "Shares" as used herein shall include, all of the shares of Common Stock and Preferred Stock of the Company, whether issued before or after the Closing Date (as defined in the Stock and Warrant Purchase Agreement) and all securities issued as a replacement for the Shares or with respect to the Shares as a result of any stock dividend, stock split or other similar event. 4. Term of the Agreement. This Agreement shall terminate on the earlier --------------------- of (a) the consummation by the Company of any underwritten public offering of the Company's securities in which the gross proceeds to the Company equal or exceed $10,000,000 at a purchase price of 1 $3.52 per share (as adjusted for stock splits, stock dividends, reorganizations and the like), (b) the sale of the Company (through a merger, consolidation, sale of all or substantially all of its assets or stock), or (c) the effective time of the liquidation of the Company. 5. Binding Effect on Transferees. This Agreement and all of the terms, ----------------------------- covenants, and conditions herein contained, shall be binding upon and inure to the benefit of all of the parties hereto and their respective transferees, successors, heirs, executors, administrators and assigns. A condition precedent to the transfer of any of the Common Stock of the Company to any third party by Crane is that the transferee shall become a party to this Agreement and shall execute any and all instruments, and take all other actions, necessary to carry out the purposes of this Agreement. Notwithstanding the foregoing, this Agreement shall not bind any transferee of Crane that is a not-for-profit charitable organization, provided, however, that the foregoing exception shall -------- ------- no longer apply following the transfer by Crane of an aggregate of up to 257,000 of the Company's common stock by Crane to not-for-profit charitable organizations. 6. Severability. Wherever there is any conflict between any provision of ------------ this Agreement and statute, law, regulation or judicial precedent, the latter shall prevail, but in such event the provisions of this Agreement thus affected shall be curtailed and limited only to the extent necessary to bring it within the requirement of the law. In the event that any part, section, paragraph, or clause of this Agreement shall be held by a court of proper jurisdiction to be indefinite, invalid or otherwise unenforceable, the entire Agreement shall not fail on account thereof, but the balance of the Agreement shall continue in full force and effect unless such construction would clearly be contrary to the intentions of the parties. 7. Miscellaneous. ------------- (a) Waivers and Amendments. With the written consent of Crane, the ---------------------- holders of a majority of the Series A Preferred Stock purchased by the Purchasers and the Company, this Agreement may be amended and the obligations of Crane under this Agreement may be waived (either generally or in a particular instance, either retroactively or prospectively, and either for a specified period of time or indefinitely). (b) Governing Law. This Agreement shall be executed and entered into ------------- in the State of Delaware and is to be governed by and interpreted under the laws of the that state. (c) Entire Agreement. This Agreement constitutes the entire ---------------- agreement between the parties with respect to the matters referred to herein, and no prior or contemporaneous agreement or understanding shall be effective for any purpose. (d) Heading. The paragraph headings herein have been inserted for ------- convenience only, and are not intended to restrict, construe, or modify in any manner any of the terms and provisions hereof. (e) Counterparts. This Agreement may be executed in any number of ------------ counterparts, each of which shall be an original, but all of which together shall constitute one instrument. 2 (f) Delays or Omissions. It is agreed that no delay or omission to ------------------- exercise any right, power or remedy accruing to any party hereto, upon any breach or default of any other party hereto shall impair such right, power or remedy, nor shall it be construed to be a waiver of any such breach or default, or any acquiescence herein, or of or in any similar breach or default thereafter occurring. It is further agreed that any waiver, permit, consent or approval of any kind or character on the part of the party hereto of any breach or default under this Agreement, or any waiver of any provisions or conditions of this Agreement must be in writing and shall be effective only to the extent specifically set forth in such writing and that all remedies, either under this Agreement, or by law or otherwise afforded to such party, shall be cumulative and not alternative. (g) Specific Performance. The parties will be entitled to enforce -------------------- their rights under this Agreement specifically (without posting a bond or other security), to recover damages by reason of any breach of any provision of this agreement and to exercise all other rights existing in their favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and any party may in its sole discretion apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive relief in order to enforce or prevent any violation of the provisions of this Agreement. (h) Dispute Resolution. The parties acknowledge and agree that time ------------------ is of the essence in resolving any dispute that may arise in connection with this Agreement. Except as set forth herein, any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be settled by binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"). The expenses of the arbitration, including the arbitrator's fees, expert witness fees, and attorneys' fees, may be awarded to the prevailing party, in the discretion of the arbitrator, or may be apportioned between the parties in any manner deemed appropriate by the arbitrator. Unless and until the arbitrator decides that one party is to pay for all (or a share) of such expenses, the Company shall pay all reasonable expenses, including legal and accounting fees and costs arising in connection with enforcement of this Agreement or the Collateral Agreements. The parties shall keep confidential the decision of the arbitrator. Notwithstanding the foregoing, the parties may disclose information about such decision to persons who have a need to know, such as directors, trustees, management employees, witnesses, experts, investors, attorneys, lenders, insurers, and others who may be affected. Once the arbitration award has become final, if the arbitration award is not promptly satisfied, then these confidentiality provisions shall no longer be applicable. Notwithstanding the foregoing, any party may seek equitable 3 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. COMPS INFOSYSTEMS, INC. By:__________________________________________ Title:_______________________________________ _____________________________________________ Christopher A. Crane, in his individual capacity PURCHASERS: SUMMIT VENTURES III, L.P. By: Summit Partners III, L.P. General Partner By: Stamps, Woodsum & Co. III, General Partner By:_____________________________________ General Partner SUMMIT INVESTORS II, L.P. By:__________________________________________ General Partner 4 EXHIBIT J Form of Opinion of Counsel October 14, 1994 Summit Ventures III, L.P. Summit Investors II, L.P. 409 Hamilton Avenue, Suite 200 Palo Alto, California 94301 Re: COMPS InfoSystems, Inc.: 4,270,336 Shares of Series A Preferred ---------------------------------------------------------------- Stock and 379,869 Warrants to Purchase Shares of Class B Common --------------------------------------------------------------- Stock ----- Ladies and Gentlemen: We have acted as counsel to COMPS InfoSystems, Inc., a Delaware corporation (the "Company"), in connection with the sale to Summit Ventures III, L.P. and Summit Investors II, L.P. (together, "Summit") on the date hereof by the Company of 4,270,336 shares (the "Shares"), of Series A Preferred Stock of the Company, par value $.01 per share (the "Preferred Stock"), and warrants (the `Warrants'), to purchase 379,869 shares of the Class B Common Stock of the Company, par value $.01 per share (the "Class B Common Stock"), pursuant to that certain Stock and Warrant Purchase Agreement dated as of October 14, 1994 (the "Agreement") among Summit and the Company. This opinion is being rendered to you pursuant to Section 5.1(i) of the Agreement. Capitalized terms used in the Agreement, used herein, and not otherwise defined herein shall have the meanings given them in the Agreement. As such counsel, we have made such legal and factual examinations and inquiries as we have deemed necessary or appropriate for purposes of this opinion, except where a statement is qualified as to knowledge or awareness, in which case we have made no or limited inquiry as specified below. We have examined, among other things, the following: (a) The Agreement; (b) The Voting Agreement, the Warrants, the Right of First Refusal and Co-Sale Agreement, and the Investors Right Agreement, each between Summit and the Company and each dated as of October 14, 1994 and the Shareholders' Buy-out and Voting Agreement among Summit, the Company and the Shareholders named therein, dated as of October 14, 1994; (c) The notes, loan agreements, mortgages, deeds of trust, security agreements and other written agreements and instruments creating, evidencing or securing indebtedness of the Company for borrowed money, identified to us by an officer of the Summit Ventures III, L.P. Summit Investors II, L.P. October 14, 1994 Page 2 Company as material to the Company, and the other agreements listed on Exhibit H to the Agreement (the "Material Agreements"); (d) The Restated Certificate of Incorporation (the "Restated Certificate") and Bylaws of the Company (together, the "Governing Documents"); (e) Court and administrative orders, writs, judgments, injunctions and decrees specifically directed to the Company and identified to us by an officer of the Company as material to the Company (the "Court Orders"); (f) Records of the Company with respect to the issuance and transfer of capital stock and options; (g) Minutes of the meetings of the Board of Directors and Stockholders of the Company and various written consents provided to us by the officers of the Company; (h) A certificate of good standing from the Secretary of State of Delaware; (i) A certificate of good standing from the Secretary of State of California; and (j) A certificate from certain of the Company's officers as of the date hereof. (k) The Agreement and Plan of Merger between the Company and Business Real Estate Information Corp.. a California corporation ("BREIC"), dated as of September 29, 1994 (the "Merger Agreement"), relating to the statutory merger of BREIC with the Company on the terms and conditions set forth in the Merger Agreement (the "Merger"); and (l) The Certificate of Ownership and Merger of BREIC into the Company, dated September 29, 1994 (the "Merger Certificate"). The documents described in subsections (a) - (b) above are referred to herein collectively as the "Documents." In such examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, and the conformity to authentic original documents of all documents submitted to us as copies. In rendering this opinion, we have relied on and assumed the correctness and completeness of certificates of government officials and reports of professional filing service companies. As to questions of fact, we have been furnished with, and with your consent have exclusively relied upon, certificates of officers and representatives of the Company. In addition, we assumed that the representations and warranties of Summit set forth in the Documents are true and correct as of the date hereof, including without limitation the representation that each of the Purchasers is an "accredited investor" as defined under Regulation D pursuant to the Securities Act of 1933, as amended (the "Act"). Summit Ventures III, L.P. Summit Investors II, L.P. October 14, 1994 Page 3 To the extent that the obligations of the Company may be dependent upon such matters, we assume for purposes of this opinion that: all parties to the Documents other than the Company have complied with any applicable requirement to file returns and pay taxes under the Franchise Tax Law of the State of California; all parties to the Documents other than the Company are duly organized, validly existing and in good standing under the laws of their respective jurisdictions of organization; all parties to the Documents other than the Company have the requisite power and authority to execute and deliver the Documents and to perform their respective obligations under the Documents to which they are a party; and the Documents to which such parties other than the Company are a party have been duly authorized, executed and delivered by such parties and constitute their legally valid and binding obligations, enforceable against them in accordance with their terms. We express no opinion as to compliance by all parties to the Documents other than the Company with any state or federal laws or regulations applicable to the subject transactions because of the nature of their business. Where statements in our opinion are qualified by the term "material," those statements involve judgments and opinions as to the materiality or lack of materiality of any matter to the Company or its business, prospects, assets or financial condition, which are entirely those of the Company and its officers, after having been advised by us as to the legal effect of such matters; however, such opinions and judgments are not known by us to be incorrect. Whenever a statement herein is qualified by `to the best of our knowledge" or a similar phrase, it is intended to indicate that those attorneys in this firm who have rendered legal services in connection with the sale of the Shares and the Warrants do not have current actual knowledge of the inaccuracy of such statement. However, except as otherwise expressly indicated, we have not undertaken any independent investigation to determine the accuracy of any such statement, and no inference that we have any knowledge of any matters pertaining to such statement should be drawn from our representation of the Company. The opinions hereinafter expressed below are subject to the following qualifications: (a) Our opinion is qualified and no opinion is given to the extent that the enforceability of any agreement entered into by the Company, including the Documents, may be limited by, or such agreements and the transactions contemplated thereby may be subject to or affected by, the effect of general principles of equity, including without limitation, concepts of materiality, reasonableness, good faith and fair dealing and the possible unavailability of specific performance or injunctive relief (regardless of whether considered in a proceeding in equity or at law), or that may otherwise contravene public policy; (b) Our opinion is qualified and no opinion is given to the extent that the enforceability of any agreement entered into by the Company, including the Documents, may be limited by, or such agreements and the transactions contemplated thereby may be subject to or affected by: (i) the effect of bankruptcy, reorganization, insolvency, liquidation, readjustment of debt, arrangement, moratorium or other similar laws now or hereinafter in effect relating to or Summit Ventures III, L.P. Summit Investors II, L.P. October 14, 1994 Page 4 affecting the rights of creditors or (ii) any other laws or statutes which modify, affect or invalidate any remedial, contribution or indemnification provisions set forth in such agreements; (c) We express no opinion with respect to the enforceability of Section II(F) of the Investors Rights Agreement; (d) Our opinion is qualified and no opinion is given to the extent that certain rights, remedies and waivers contained in the Documents may be limited or rendered ineffective by applicable California laws or judicial decisions governing such provisions, but such laws or judicial decisions do not render the Documents invalid or unenforceable as a whole; (e) We express no opinion as to the Company's compliance with the securities laws, rules and regulations of any state other than California, or with the antifraud provisions of state (including California) and federal laws, rules and regulations concerning the issuance of securities; (f) We express no opinion as to the enforceability of any of the agreements (other than the Documents) attached as exhibits to the Agreement; (g) We are opining herein as to the effect on the subject transaction only of the federal laws of the United States, the internal laws of the State of California and the General Corporation Law of Delaware, and we express no opinion with respect to the applicability thereto, or the effect thereon, of the laws of any other jurisdiction or in the case of Delaware, any other laws, or as to any matters of municipal law or the laws of any other local agency within any state; (h) Our opinion is limited by the effect of and subject to any disclosures or exceptions contained in or referred to in the Documents, including, without limitation, those contained in the Officer's Certificate delivered by the Company at the Closing pursuant to the Agreement; (i) We express no opinion as to matters concerning intellectual property, (including, without limitation, patents, trademarks, maskworks, trade secrets and copyrights), real estate or employment matters; (j) We have assumed that there are no agreements, contracts, understandings or negotiations among the parties to any agreement as to which we are required to opine, that would modify the terms of such agreements or the respective rights or obligations of the parties thereunder; (k) We express no opinion as to compliance with the antitrust provisions of federal or state statutory or common law; (1) With respect to our opinion in paragraph 1, we have relied solely upon certificates (or the verbal acknowledgement) of the Secretary of State of Delaware to the effect that the Company is duly incorporated and in good standing under the laws of the Delaware. Summit Ventures III, L.P. Summit Investors II, L.P. October 14, 1994 Page 5 Based upon and subject to the foregoing, it is our opinion that, as of the date hereof: 1. The Company has been duly incorporated and is validly existing and in good standing under the laws of the State of Delaware with corporate power and authority to own its properties and to conduct its business. Based solely on certificates from public officials, we confirm that the Company is qualified to do business in California. 2. To our knowledge, the Company does not control, directly or indirectly, any other corporation, partnership, joint venture or business entity. 3. The Company has the corporate power to execute and deliver the Documents and to consummate the transactions contemplated thereby. The execution and delivery by the Company of the Documents and the consummation of the transactions contemplated thereby have been duly authorized by all necessary corporate action on the part of the Company, including all necessary stockholder approvals. Each of the Documents has been duly executed and delivered by the Company, and constitutes a legally valid and binding obligation of the Company, enforceable against the Company in accordance with its terms. 4. The authorized capital stock of the Company is 25,000,000 shares of Common Stock, par value $.01 per share (the "Common Stock") and 5,000,000 shares of Preferred Stock. The first series of common stock is comprised of 22,500,000 shares designated "Clan A Common Stock". The second series of common stock is comprised of 2,500,000 shares designated "Class B Common Stock". Immediately prior to the Closing (but after the filing of the Restated Certificate), there were issued and outstanding 6,482,000 shares of Class A Common Stock, no shares of Class B Common Stock, and no shares of Preferred Stock. The rights of the Class A Common Stock are as set forth in the Restated Certificate. All issued and outstanding shares of Class A Common Stock have been duly authorized and validly issued are fully paid and nonassessable and, to our knowledge, are free of any preemptive rights contained in the Governing Documents of the Company. The issuance of the outstanding shares of Class A Common Stock did not, to our knowledge, require any consents, approvals, authorizations, registrations or filings by the Company under any Federal, California or Delaware statute, rule or regulation applicable to the Company, except such as have been or will be obtained or made. To our knowledge, except for (i) the rights, preferences and privileges of the Class B Common Stock and the Preferred Stock as set forth in the Restated Certificate of Incorporation, a certified copy of which is being provided to you at the Closing, (ii) the rights set forth in the Agreement and the exhibits thereto, (iii) the shares of Class B Common Stock issuable upon the exercise of outstanding stock options under the Company's Stock Option Plan, and (iv) the Warrants issued to you, there are no outstanding rights, options, warrants, conversion rights or agreements for the purchase or acquisition from the Company of any shares of its capital stock. 5. The Class A Common Stock issuable upon conversion of the Shares and conversion of the Class B Common Stock (including the Class B Common Stock issuable upon exercise of the Warrants) has been duly and validly reserved. The Class B Common Stock issuable upon exercise of the Warrants has been duly and validly reserved. The Shares, the Class Summit Ventures III, L.P. Summit Investors II, L.P. October 14, 1994 Page 6 A Common Stock issuable upon conversion of the Shares and upon conversion of the Class B Common Stock, and the Class B Common Stock issuable upon exercise of the Warrants, when issued in compliance with the provisions of the Company's Restated Certificate or the provisions of the Warrants, will be validly issued, fully paid and nonassessable. To our knowledge, (i) upon the issuance and delivery by the Company of the Shares and payment by the Purchasers therefor in accordance with the terms of the Agreement, the Purchasers will acquire such Shares free of any lien, encumbrance or restriction on transfer (except for any transfer restrictions arising under federal or state securities laws or any lien, encumbrance or transfer restrictions created by the Purchasers) and (ii) upon the issuance and delivery by the Company of the Warrants and payment by the Purchasers therefor in accordance with the terms of the Agreement, the Purchasers will acquire such Warrants free of any lien, encumbrance or restriction on transfer (except for any transfer restrictions arising under federal or state securities laws or any lien, encumbrance or transfer restrictions created by the Purchasers). To our knowledge, except as set forth in the Agreement and the exhibits thereto, no person has any preemptive rights or any right of first refusal in connection with the issuance of the Shares or any future issuances of securities by the Company other than those held by the Purchasers. 6. The execution and delivery of the Documents do not: (i) to our knowledge, violate any federal, California or Delaware statute, rule or regulation applicable to the Company, (ii) violate the provisions of the Governing Documents of the Company or, (iii) to our knowledge, conflict with or constitute a material default under the Material Agreements or the Court Orders. 7. The execution and delivery of the Documents and the issuance and sale of the Shares and the Warrants do not, to our knowledge, require any consents, approvals, authorizations, registrations, declarations or filings by the Company under any federal, California or Delaware statute, rule or regulation applicable to the Company, except such as have been or will be obtained. 8. To our knowledge, except as set forth in the Agreement or the exhibits thereto, there are no actions, proceedings or investigations pending against the Company, nor has the Company received any threat thereof, which questions the validity of the Documents or the right of the Company to enter into the Documents that, if adversely decided, would have a material adverse effect upon the business or financial condition of the Company taken as a whole. 9. The offer, sale and issuance pursuant to the terms of the Agreement of the Shares and the Warrants is exempt (i) from the registration requirements of Section 5 of the Act, and (ii) from the qualification requirements of the Corporate Securities Law of the State of California (the "California Securities Law") pursuant to Section 25102 (f) of the California Securities Law; and, under the Act and the California Securities Law as they presently exist, the issuance of the Class A Common Stock issuable upon conversion of the Shares and upon conversion of the Class B Common Stock, and of the issuance of the Class B Common Stock issuable upon exercise of the Warrants, when issued in conformity with the terms of the Restated Certificate, will be exempt from such registration and qualification requirements. Summit Ventures III, L.P. Summit Investors II, L.P. October 14, 1994 Page 7 10. Upon the filing of the Merger Certificate with the Secretary of State of Delaware, the Merger shall have been duly consummated in accordance with the General Corporation Law of the State of Delaware with the effect provided therein and in Article I of the Merger Agreement. This opinion is rendered only to you and is solely for your benefit in connection with the transactions covered hereby. This opinion may not be relied upon by you for any other purpose, or furnished to, quoted to or relied upon by any other person, firm or corporation for any purpose, without our prior written consent. Very truly yours, EX-10.3 8 STOCK AND WARRANT PURCHASE AGMT DATED 2/9/98 EXHIBIT 10.3 COMPS INFOSYSTEMS, INC. STOCK AND WARRANT PURCHASE AGREEMENT THIS AGREEMENT (the "Agreement") is made as of February 9, 1998, by and among, severally and not jointly, COMPS InfoSystems, Inc., a Delaware corporation (the "Company"), Summit Ventures III, L.P., a Delaware limited partnership ("Summit III"), Summit Investors II, L.P., a Delaware limited partnership ("Summit II," and collectively with Summit III, "Summit"), Christopher A. Crane ("Crane") and Merrill Oster ("Oster," and collectively with Crane and Summit, the "Purchasers," and individually, a "Purchaser"). The parties hereby agree as follows: 1. Sale and Issuance of the Shares and Warrants. -------------------------------------------- 1.1. Sale and Issuance of the Series B Preferred Shares. Subject to --------------------------------------------------- the terms and conditions hereof, the Company will issue and sell to each Purchaser and each Purchaser will purchase the number of shares of the Company's Series B Preferred Stock (the "Shares") specified opposite the Purchaser's name as set forth in the Schedule of Purchasers attached hereto as Exhibit A. at a price of $1.80310 per Share. 1.2. Issuance of Warrants. In consideration for the purchase by the -------------------- Purchasers of the Shares, the Company will issue to each of Summit III, Summit II and Oster a warrant in the form attached hereto as Exhibit B-1 and to Crane a ----------- warrant in the form attached hereto as Exhibit B-2 (individually, a "Warrant" ----------- and collectively, the "Warrants"), to purchase up to the number and type of shares of the Company's Common Stock (the "Warrant Shares") set forth opposite such Purchaser's name on Exhibit A at an exercise price of $.01 per share. --------- 2. Closing Date; Delivery. ---------------------- 2.1. Closing Date. ------------ (a) Purchase and Sale. The closing of the purchase and sale of ----------------- an aggregate of 637,790 Shares and of the issuance of the Warrants to purchase 306,097 shares of Class B Common Stock and 37,329 shares of Class A Common Stock shall be held at the offices of Gray Cary Ware & Freidenrich LLP at 10: 00 a.m. on February 9, 1998, or at such other time and place as the Company and the Purchasers may agree in writing. (b) Closing. The closing referred to in Subsection (a) above is ------- hereinafter referred to as the "Closing" and the date of the Closing is hereinafter referred to as the "Closing Date". 2.2. Delivery. Subject to the terms of this Agreement, at the Closing -------- the Company will deliver to each Purchaser a certificate representing the Shares to be purchased by and the Warrant to be issued to such Purchaser from the Company, against payment of the purchase price for the Shares by a check or checks payable to the order of the Company, or by wire transfer. 3. Representations and Warranties of the Company and Crane. The Company ------------------------------------------------------- and Crane hereby represent and warrant to Summit and Oster that except as set forth on a Schedule of Exceptions attached hereto as Exhibit C, which exceptions --------- shall be deemed to be representations and warranties as if made hereunder: 3.1. Organization and Standing: Certificate and By-laws. The Company -------------------------------------------------- is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its businesses as now conducted and as proposed to be conducted. The Company is qualified or licensed to do business as a foreign corporation in all jurisdictions where such qualification or licensing is required, except where the failure to so qualify would not have a material adverse effect upon the Company. Complete copies of the Company's Restated Certificate of Incorporation (as defined in Section 3.5), By-laws, minutes and consents of stockholders and of the Board of Directors are available for inspection at the Company's offices and have been previously provided to special counsel for the Purchasers. 3.2. Corporate Power. The Company has now, or will have at the Closing --------------- Date, all requisite corporate power to enter into this Agreement, the Amended and Restated Investor Rights Agreement, in the form attached hereto as Exhibit D --------- (the "Amended and Restated Investor Rights Agreement"), the Amended and Restated Right of First Refusal and Co-Sale Agreement attached hereto as Exhibit E (the --------- "Amended and Restated Right of First Refusal and Co-Sale Agreement"), and the Amended and Restated Voting Agreement attached hereto as Exhibit F (the "Amended --------- and Restated Voting Agreement") (together, the "Collateral Agreements") and to sell and issue the Shares and Warrants and the Warrant Shares upon exercise of the Warrants and to issue the Company's Class A Common Stock upon conversion of the Shares. This Agreement and each of the Collateral Agreements is a valid and binding obligation of the Company enforceable in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, moratorium, and other laws of general application affecting the enforcement of creditors' rights. 3.3. Subsidiaries. The Company does not control, directly or ------------ indirectly, any other corporation, association or business entity. 3.4. Capitalization. As of the Closing, and after giving effect to -------------- the transactions contemplated in this Agreement, the authorized capital stock of the Company is 25,000,000 shares of Common Stock of which 22,500,000 shares are designated as Class A Common Stock and 2,500,000 shares are designated as Class B Common Stock and 5,000,000 shares of preferred stock ("Preferred Stock") of which 4,270,336 shares are designated as Series A Preferred Stock and 637,790 shares are designated as Series B Preferred Stock. As of the Closing, and after giving effect to the transactions contemplated in this Agreement, there are issued and outstanding 4,773,860 shares of the Company's Class A Common Stock, no shares of the Company's Class B Common Stock, 4,270,336 shares of the Company's Series A Preferred Stock and 637,790 shares of the Company's Series B Preferred Stock. All issued and outstanding shares have been duly authorized and validly issued, are fully paid and nonassessable, and were issued in compliance with all applicable state and federal laws concerning the issuance of securities. As of the Closing, and after giving effect to the transactions contemplated in this Agreement, there are (i) 1,719,909 shares of Class B Common 2 Stock reserved for issuance to the Company's officers, directors, employees and consultants pursuant to Company compensation plans, of which 884,750 represent shares subject to currently outstanding options, and (ii) 899,034 shares of Class B Common Stock and 37,329 shares of Class A Common Stock reserved for issuance to holders of the Warrants upon exercise of the warrants. The Company has provided the Purchasers with a complete and accurate list, as of immediately prior to the Closing, of all holders of any and all rights, options, warrants or conversion rights to purchase or acquire from the Company any of its capital stock, along with the number of shares of capital stock issuable upon exercise of such rights. Except for such rights, there are no outstanding rights, options, warrants, conversion rights or agreements for the purchase or acquisition from the Company of any shares of its capital stock. 3.5. Authorization. ------------- (a) Corporate Action. All corporate action on the part of the ---------------- Company, its officers, directors and stockholders necessary for the sale and issuance of the Shares and Warrants pursuant hereto, the issuance of the Warrant Shares upon the exercise of the Warrants, the issuance of the Class A Common Stock issuable upon conversion of the Shares and the performance of the Company's obligations hereunder and under each of the Collateral Agreements has been taken or will be taken prior to the Closing. The Company has duly reserved an aggregate of 306,097 shares of Class B Common Stock and 37,329 shares of Class A Common Stock for issuance upon exercise of the Warrants, and 637,790 shares of Class A Common Stock for issuance upon conversion of the Shares. (b) Valid Issuance. The Shares and Warrants, when issued in -------------- compliance with the provisions of this Agreement, the Warrant Shares, when issued in accordance with the terms of the Warrants and each of the Collateral Agreements, and the shares of Class A Common Stock issued upon conversion of the Shares when issued in accordance with the provisions of the Company's Restated Certificate of Incorporation, will be validly issued, My paid and nonassessable and will be free of any liens or encumbrances other than those created by the Purchasers; provided, however, that all such shares may be subject to restrictions on transfer under state and/or federal securities laws as set forth herein, and as may be required by future changes in such laws. The rights, preferences, privileges and restrictions of the Series B Preferred Stock are as set forth in the Restated Certificate of Incorporation, the form of which is attached hereto as Exhibit G (the "Restated Certificate of Incorporation"). --------- (c) No Preemptive Rights. No person has any right of first -------------------- refusal or any preemptive rights in connection with the issuance of the Shares or Warrants, the issuance of the Warrant Shares upon exercise of the Warrants, the issuance of the Class A Common Stock upon conversion of the Shares or any future issuances of securities by the Company other than those held by the Purchasers or those contemplated by the Collateral Agreements. 3.6. Patents, Trademarks, Etc. The Company owns and possesses or is ------------------------ licensed under all patents, patent applications, licenses, trademarks, trade names, brand names, inventions and copyrights employed in the operation of its business as now conducted and as proposed to be conducted, with no infringement of or conflict with the rights of others respecting any of the same. The operation of the Company's business as now conducted or as proposed to be conducted does not and will not infringe any patent or other proprietary rights of others 3 respecting any of the same. The Company is not obligated to make any payments by way of royalties, fees or otherwise to any owner, licensor of, or other claimant to any patent, trademark, trade name, copyright or other intangible asset, with respect to the use thereof or in connection with the conduct of its business, or otherwise. The Company has not received any communications alleging that it has violated or, by conducting its business as proposed, would violate any of the patents, trademarks, service marks, trade names, copyrights or trade secrets or other proprietary rights of any other person or entity, nor is the Company aware of any basis for the foregoing. 3.7. Compliance with Other Instruments, None Burdensome, Etc. The ------------------------------------------------------- Company is not in violation of any term of its Restated Certificate of Incorporation or By-laws, nor is the Company in violation of or in default in any material respect under the terms of any mortgage, indenture, contract, agreement, instrument, judgment or decree, the violation of which would have a material adverse effect on the Company as a whole, and is not in violation of any order, statute, rule or regulation applicable to the Company, the violation of which would have a material adverse effect on the Company. The execution, delivery and performance of and compliance with this Agreement and each of the Collateral Agreements, and the issuance and sale of the Shares and Warrants pursuant hereto or of the Warrant Shares pursuant to the terms of the Warrants, will not (a) result in any such violation, or (b) be in conflict with or constitute a default under any such term, or (c) result in the creation of any mortgage, pledge, lien, encumbrance or charge upon any of the properties or assets of the Company pursuant to any such term. To the best knowledge of the Company, there is no such term which materially adversely affects, or in the future may materially adversely affect, the business, prospects, condition, affairs or operations of the Company or any of its properties or assets. 3.8. Proprietary Agreements, Employees. Each employee of the Company --------------------------------- has executed an agreement regarding confidentiality and proprietary information, the current form of which has been provided to special counsel to the Purchasers. The Company is not aware that any of its employees is in violation thereof and will use its best efforts to prevent any such violation. The Company is not aware that any of its employees is obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, that would interfere with the use of his or her best efforts to promote the interests of the Company or that would conflict with the Company's business as conducted or as proposed to be conducted or that would prevent any such employee from assigning inventions to the Company. Neither the execution nor delivery of this Agreement or the Collateral Agreements, nor the carrying on of the Company's business as proposed, will, to the Company's knowledge, conflict with or result in a breach of the terms, conditions or provisions of, or constitute a default under, any contract, covenant or instrument under which any of such employees is now obligated. The Company does not believe that it is or will be necessary for the Company to utilize any inventions of any of its employees (or people it currently intends to hire) made prior to their employment by the Company. 3.9. Litigation, Etc. There is no action, proceeding or investigation --------------- pending against the Company or its officers, directors or stockholders, or to the best of the Company's knowledge, against employees or consultants of the Company (or, to the best of the Company's knowledge, any basis therefor or threat thereof): (1) which might result, either individually or in the aggregate, in (a) any material adverse change in the business, prospects, conditions, affairs or 4 operations of the Company or in any of its properties or assets, or (b) any material impairment of the right or ability of the Company to carry on its business as now conducted or as proposed to be conducted, or (c) any material liability on the part of the Company; or (2) which questions the validity of this Agreement, the Collateral Agreements or any action taken or to be taken in connection herewith or thereunder, including in each case, without limitation, actions pending or threatened involving the prior employment of any of the Company's employees, the use in connection with the Company's business of any information or techniques allegedly proprietary to any of its former employees, or their obligations under any agreements with prior employers. The Company is not a party to or subject to the provisions of any order, writ, injunction, judgment or decree of any court or government agency or instrumentality. There is no action, suit, proceeding or investigation by the Company currently pending or which the Company currently intends to initiate. 3.10. Governmental Consent, Etc. No consent. approval or ------------------------------------- authorization of or designation, declaration or filing with any governmental authority on the part of the Company is required in connection with: (a) the valid execution and delivery of this Agreement or either of the Collateral Agreements; or (b) the offer, sale or issuance of the Shares and Warrants, the issuance of the Warrant Shares upon exercise of the Warrants, or the issuance of the shares of Common Stock issuable upon conversion of the Preferred Stock or (c) the obtaining of the consents, permits and waivers specified in Subsection 5. I (b) hereof, except the filing of the Restated Articles and, if required, filings or qualifications under the California Corporate Securities Law of 1968, as amended (the "California Law"), or other applicable blue sky laws, which filings or qualifications, if required, will have been timely filed or obtained after the sale of the Shares and Warrants. 3.11. Offering. In reliance in part on the representations and -------- warranties of the Purchasers in Section 4 hereof, the offer, sale and issuance of the Shares and Warrants in conformity with the terms of this Agreement will not result in a violation of the requirements of Section 5 of the Securities Act of 1933, as amended (the "Securities Act") or the qualification or registration requirements of the California Law or other applicable blue sky laws. 3.12. Taxes. The Company has filed all tax returns that are required ----- to have been filed with appropriate federal, state, county and local governmental agencies or instrumentalities, except where the failure to do so would not have a material adverse effect upon the Company, taken as a whole. The Company has paid or established reserves for all income, franchise and other taxes, assessments, governmental charges, penalties, interest and fines due and payable by them on or before the Closing. There is no pending dispute with any taxing authority relating to any of such returns and the Company has no knowledge of any proposed liability for any tax to be imposed upon the properties or assets of the Company for which there is not an adequate reserve reflected in the Financial Statements (as defined below). 3.13. Title. The Company owns its property and assets, including the ----- properties and assets reflected in the Financial Statements, free and clear of all liens, mortgages, loans or encumbrances except liens for current taxes, and such encumbrances and liens which arise in the ordinary course of business and do not materially impair the Company's ownership or use of such property or assets. With respect to the property and assets leased by the Company, the 5 Company is in compliance with such leases and, to the best of the Company's knowledge, holds valid leasehold interests free and clear of any liens, claims or encumbrances. 3.14. Material Contracts and Commitments. All of the contracts, ---------------------------------- mortgages, indentures, agreements, instruments and transactions to which the Company is a party or by which it is bound (including purchase orders to the Company or placed by the Company) which involve obligations of, or payments to, the Company in excess of Twenty-Five Thousand Dollars ($25,000), excluding subscription and license agreements entered into in the ordinary course of the Company's business, and all agreements between the Company and its stockholders, officers, directors, consultants and employees are either (i) attached as exhibits to this Agreement, or (ii) set forth on the list attached hereto as Exhibit H (the "Contracts"), copies of which have been delivered to special counsel to the Purchasers. All of the Contracts are valid, binding and in full force and effect and enforceable by the Company in accordance with their respective terms in ail material respects, subject to the effect of applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application relating to or affecting enforcement of creditors' rights and rules or laws concerning equitable remedies. The Company is not in material default under any of such Contracts. To the best of the Company's knowledge, no other party to any of the Contracts is in material default thereunder. 3.15. Financial Statements. The Company has delivered to each -------------------- Purchaser its audited balance sheets as of December 31, 1995 and December 31, 1996 and its unaudited balance sheet as of November 30, 1997 (the "Balance Sheets") and its audited consolidated income statements and cash flow statements for the years ended December 31, 1995 and December 31, 1996 and its unaudited consolidated income statement and cash flow statement for the eleven month period ended November 30, 1997 (the above financial statements are hereinafter collectively referred to as the "Financial Statements"). The Financial Statements are complete and correct in all material respects and have been prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the relevant period. The Financial Statements accurately set out and describe the financial condition and operating results of the Company as of the date, and during the period, indicated therein. Except as set forth in the Financial Statements, the Company has no liabilities of any nature (matured or unmatured, fixed or contingent), other than (i) liabilities incurred in the ordinary course of business subsequent to November 30, 1997, except for the equipment leasing for an amount equal to $303,000 from Venture Lending & Leasing, Inc., and (ii) obligations under contracts and commitments incurred in the ordinary course of business and not required under generally accepted accounting principles to be reflected in the Financial Statements, which, individually or in the aggregate, are not material to the financial condition or operating results of the Company. The Company maintains and will continue to maintain a standard system of accounting established and :administered in accordance with generally accepted accounting principles. 3.16. Absence of Changes. Since December 31, 1996: (a) the Company ------------------ has not entered into any transaction which was not in the ordinary course of business, however, the Company notes that it did enter into an equipment leasing agreement with Venture Lending & Leasing, Inc. for $746,000, which agreement the Company considers to be in the ordinary course of business, (b) there has been no material adverse change in the condition (financial or otherwise) of the business, property, assets or liabilities of the Company other than changes in the ordinary course of its business, none of which, individually or in the aggregate, has been 6 materially adverse, (c) there has been no damage to, destruction of or loss of physical property (whether or not covered by insurance) materially and adversely affecting the assets, prospects, financial condition, operating results, business or operations of the Company, (d) the Company has not declared or paid any dividend or made any distribution on its stock, or redeemed, purchased or otherwise acquired any of its stock, (e) the Company has not materially changed any compensation arrangement or agreement with any of its key employees or executive officers, or materially changed the rate of pay of its employees as a group, (f) the Company has not received notice that there has been a cancellation of an order for the Company's products or a loss of a customer of the Company, the cancellation or loss of which would materially adversely affect the business of the Company, (g) the Company has not changed or amended any material contract by which the Company or any of its assets are bound or subject, except as contemplated by this Agreement, (h) there has been no resignation or termination of employment of any key officer or employee of the Company and the Company does not know of any impending resignation or termination of employment of any such officer or employee that if consummated would have a material adverse effect on the business of the Company, (i) there has been no labor dispute involving the Company or its employees and none is pending or, to the best of the Company's knowledge, threatened, (j) there has been no change, except in the ordinary course of business, in the material contingent obligations of the Company (nor in any contingent obligation of the Company regarding any director, shareholder or key employee or officer of the Company) by way of guaranty, endorsement, indemnity, warranty or otherwise, (k) there have been no loans made by the Company to any of its employees, officers or directors other than travel advances and other advances made in the ordinary course of business, (1) there has been no waiver by the Company of a valuable right or of a material debt owing to it, (m) there has not been any satisfaction or discharge of any lien, claims or encumbrance or any payment of any obligation by the Company, except in the ordinary course of business and which is not material to the assets, properties, financial condition, operating results or business of the Company, and (n) to the best of the knowledge of the Company, there has been no other event or condition of any character pertaining to and materially adversely affecting the assets or business of the Company. 3.17. Outstanding Indebtedness. Except as disclosed in the Balance ------------------------ Sheets, the Company has no indebtedness for borrowed money which it has directly or indirectly created, incurred, assumed or guaranteed, or with respect to which it has otherwise become liable, directly or indirectly. 3.18. Registration Rights. Other than as granted pursuant to the ------------------- Amended and Restated Investor Rights Agreement and the Venture Lending and Leasing, Inc. warrant dated September 24, 1996, the Company has not granted or agreed to grant any rights to register, as that term is defined in the Amended and Restated Investor Rights Agreement, any of the Company's presently outstanding securities or any of its securities that may hereafter be issued. 3.19. Certain Transactions. Except the Company's leasing of space in -------------------- the building currently occupied by the Company at 9888 Carroll Centre Road, San Diego, California from COMPS Plaza Associates, a California limited partnership, the Company is not indebted, directly or indirectly, to any of its officers, directors or stockholders or to their spouses or children, in any amount whatsoever; and none of said officers, directors or, to the best of the Company's knowledge, stockholders, or any member of their immediate families, are indebted to the Company or have any direct or indirect ownership interest in any firm or corporation with 7 which the Company is affiliated or with which the Company has a business relationship (except as a holder of securities of a corporation whose securities are publicly traded and which is subject to the reporting requirements of the Securities Exchange Act of 1934, to the extent of owning not more than two percent (2%) of the issued and outstanding securities of such corporation). No such officer, director or stockholder, or any member of their immediate families, is, directly or indirectly, interested in any material contract with the Company. The Company is not guarantor or indemnitor of any indebtedness of any other person, firm or corporation. 3.20. Corporate Documents; Minute Books. Except for amendments --------------------------------- necessary to satisfy representations and warranties or conditions contained herein (the form of which amendments has been approved by the Purchaser), the Restated Certificate of Incorporation and By-laws of the Company are in the form previously provided to special counsel to the Purchaser. The minute books of the Company previously provided to special counsel to the Purchasers contain a complete summary of all meetings and corporate actions of directors and shareholders since the time of incorporation of the Company. 3.21. Employee Benefit Plans. With the exception of a 401(k) plan, ---------------------- the Company does not have any "employee benefit plan" as defined in the Employee Retirement Income Security Act of 1974, as amended. 3.22. Real Property Holding Corporation. The Company is not a "real --------------------------------- property holding corporation" within the meaning of Section 897(c)(2) of the United States Internal Revenue Code of 1986, as amended. 3.23. Qualified Small Business. The Company is a "qualified small ------------------------ business" within the meaning of Section 1202(d) of the Internal Revenue Code of 1986, as amended, as of the date of issuance of the Shares. The Company will use reasonable efforts to comply with the reporting and recordkeeping requirements of Section 1202 and any regulations promulgated thereunder if and for so long as it appears to the Company that the Purchasers may be able to obtain the benefits of Section 1202 and any such regulations. 3.24. Disclosure. No representation or warranty by the Company in ---------- this Agreement, or in any document or certificate furnished or to be furnished to the Purchasers pursuant hereto or in connection with the transactions contemplated hereby, when taken together, contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact necessary to make the statements made herein and therein, in the light of the circumstances under which they were made, not misleading; provided, however, the with regard to the operating projections which have been delivered to the Purchaser, the Company represents only that such projections were prepared in good faith and that the Company reasonably believes there is a reasonable basis for such projections. 8 4. Representations and Warranties of Purchasers and Restrictions on ---------------------------------------------------------------- Transfer Imposed by the Securities Act. - -------------------------------------- 4.1. Representations and Warranties by the Purchaser. Each Purchaser ----------------------------------------------- represents and warrants to the Company as of the date hereof and as of the Closing Date as follows: (a) Investment Intent. This Agreement is made with the ----------------- Purchasers in reliance upon their representation to the Company, evidenced by each Purchaser's execution of this Agreement, that each Purchaser is acquiring the Shares and Warrants, and will acquire the Warrant Shares issuable upon exercise of the Warrants and the Class A Common Stock issuable upon conversion of Shares (collectively the "Securities") for investment for such Purchaser's own account, not as nominee or agent, for investment and not with a view to, or for resale in connection with, any distribution or public offering thereof within the meaning of the Securities Act and the California Law. Each Purchaser has the full right, power and authority to enter into and perform this Agreement and the Collateral Agreements and this Agreement and each of the Collateral Agreements constitute valid and binding obligations upon it. (b) Shares Not Registered. Each Purchaser understands and --------------------- acknowledges that the offering of the Securities pursuant to this Agreement will not be registered under the Securities Act or qualified under the California Law on the grounds that the offering and sale of securities contemplated by this Agreement are exempt from registration under the Securities Act and exempt from qualification pursuant to Section 25102(f) of the California Law, and that the Company's reliance upon such exemptions is predicated upon such Purchaser's representations set forth in this Agreement. (c) No Transfer. Each Purchaser covenants that in no event will ----------- such Purchaser dispose of any of the Securities (other than in conjunction with an effective registration statement for the Securities under the Securities Act or in compliance with Rule 144 promulgated under the Securities Act) unless and until (i) such Purchaser shall have notified the Company of the proposed disposition and shall have furnished the Company with a statement of the circumstances surrounding the proposed disposition, and (ii) if reasonably requested by the Company, such Purchaser shall have furnished the Company with an opinion of counsel satisfactory in form and substance to the Company to the effect that (x) such disposition will not require registration under the Securities Act and (y) appropriate action necessary for compliance with the Securities Act, the California Law and any other applicable state, local or foreign law has been taken. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144, other than opinions with regard to sales under Rule 144(k) as stated in Section 4.3 of this Agreement. (d) Permitted Transfers. Notwithstanding the provisions of ------------------- Subsection (c) above, no registration statement or opinion of counsel shall be necessary for a transfer by a Purchaser which is a partnership to a partner of such partnership or a former partner of such partnership who leaves such partnership after the date hereof, or to the estate of any such partner or former partner or the transfer by gift, will or intestate succession of any partner to his spouse or lineal descendants or ancestors, if the transferee agrees in writing to be bound by the terms of this Agreement to the same extent as if he were an original Purchaser hereunder. 9 (e) Knowledge and Experience. Each Purchaser represents that it ------------------------ (i) has such knowledge and experience In financial and business matters as to be capable of evaluating the merits and risks of such Purchaser's prospective investment in the Securities; (ii) has the ability to bear the economic risks of such Purchaser's prospective investment; (iii) has been furnished with and has had access to such information as such Purchaser has considered necessary to make a determination as to the purchase of the Securities; (iv) has had all questions which have been asked by such Purchaser satisfactorily answered by the Company; and (v) has not been offered the Securities by any form of advertisement, article, notice or other communication published in any newspaper, magazine, or similar media or broadcast over television or radio, or any seminar or meeting whose attendees have been invited by any such media. (f) Accredited Investor. Each Purchaser is an "accredited ------------------- investor" within the meaning of Securities and Exchange Commission ("SEC") Rule 501 of D, as presently in effect. (g) Not Organized to Purchase. The Purchaser has not been ------------------------- organized for the purpose of purchasing the Securities. (h) Holding Requirements. Each Purchaser understands that if the -------------------- Company does not (i) register its Common Stock with the SEC pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), (ii) become subject to Section 15(d) of the Exchange Act, (iii) supply information pursuant to Rule 15c2-11 thereunder, or (iv) have a registration statement covering the Securities (or a filing pursuant to the exemption from registration under Regulation A of the Securities Act covering the Securities) under the Securities Act in effect when it desires to sell the Securities, such Purchaser may be required to hold the Securities for an indeterminate period. Each Purchaser also understands that any sale of the Securities that might be made by such Purchaser in reliance upon Rule 144 under the Securities Act may be made only in limited amounts in accordance with the terms and conditions of that rule. (i) Legends. Each certificate representing the Securities may be ------- endorsed with the following legends: (i) Federal Legend. THE SECURITIES REPRESENTED BY THIS -------------- CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT OR (ii) IN COMPLIANCE WITH RULE 144, OR (iii) PURSUANT TO AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION. (ii) Other Legends. Any other legends required by the Law or ------------- other applicable state blue sky laws. 10 The Company need not register a transfer of legended Securities, and may also instruct its transfer agent not to register the transfer of the Securities, unless the conditions specified in each of the foregoing legends are satisfied. 4.2. Removal of Legend and Transfer Restrictions. Any legend endorsed ------------------------------------------- on a certificate pursuant to Subsection 4.2(a) and the stop transfer instructions with respect to such legended Securities shall be removed, and the Company shall issue a certificate without such legend to the holder of such Securities if such Securities are registered under the Securities Act and a prospectus meeting the requirements of Section 10 of the Securities Act is available or if such holder satisfies the requirements of Rule 144(k) and, where reasonably deemed necessary by the Company, provides the Company with an opinion of counsel for such holder of the Securities, reasonably satisfactory to the Company, to the effect that (i) such holder, meets the requirements of Rule 144(k) or (ii) a public sale, transfer or assignment of such Securities may be made without registration. 4.3. Rule 144. Each Purchaser is aware of the adoption of Rule 144 by -------- the SEC promulgated under the Securities Act, which permits limited public resales of securities acquired in a nonpublic offering, subject to the satisfaction of certain conditions. Each Purchaser understands that under Rule 144, the conditions include, among other things: the availability of certain current public information about the issuer and the resale occurring not less than two years after the party has purchased and paid for the securities to be sold. 5. Conditions to Closing. --------------------- 5.1. Conditions to Purchasers' Obligations. The obligation of each ------------------------------------- Purchaser to purchase the Shares at the Closing is subject to the fulfillment to its satisfaction, on or prior to the Closing Date, of the following conditions, any of which may be waived in accordance with the provisions of Subsection 8.1 hereof: (a) Representations and Warranties Correct; Performance of ------------------------------------------------------ Obligations. The representations and warranties made by the Company in Section 3 - ----------- hereof shall be true and correct when made, and shall be true and correct in all material respects on the Closing Date with the same force and effect as if they had been made on and as of said date. The Company's business and assets shall not have been adversely affected in any material way prior to the Closing Date. The Company shall have performed in all material respects all obligations and conditions herein required to be performed or observed by it on or prior to the Closing Date. (b) Consents and Waivers. The Company shall have obtained in a -------------------- timely fashion any and all consents, permits and waivers necessary or appropriate for consummation of the transactions contemplated by this Agreement. (c) Filing of the Restated Certificate of Incorporation. The --------------------------------------------------- Restated Certificate of Incorporation shall have been filed with the Delaware Secretary of State. (d) Amended and Restated Investor Rights Agreement. The Company ---------------------------------------------- and each Purchaser shall have executed and delivered the Amended and Restated Investor Rights Agreement in the form attached as Exhibit D hereto. --------- 11 (e) Amended and Restated Right of First Refusal and Co-Sale ------------------------------------------------------- Agreement. The Company, the Purchasers and the Stockholders shall have executed - --------- and delivered the Amended and Restated Right of First Refusal and Co-Sale Agreement in the form attached as Exhibit E hereto. --------- (f) Amended and Restated Voting Agreement. The Purchasers and ------------------------------------- the Company shall have executed and delivered the Amended and Restated Voting Agreement in the form attached as Exhibit F. --------- (g) Compliance Certificate. The Company shall have delivered a ---------------------- Certificate, executed by the President of the Company, dated the Closing Date, certifying to the fulfillment of the conditions specified in Subsections (a), (b) and (c) of this section 5. 1. (h) Opinion of Counsel. The Purchasers shall have received an ------------------ opinion from the Company's counsel in substantially the form attached hereto as Exhibit I. - --------- 5.2. Conditions to Obligations of the Company. The Company's ---------------------------------------- obligation to sell and issue the Shares and Warrants at the Closing is subject to the fulfillment to the satisfaction of the Company on or prior to the Closing Date of the following conditions, any of which may be waived by the Company: (a) Representations and Warranties Correct. The representations -------------------------------------- and warranties made by each Purchaser in Section 4 hereof shall be true and correct when made, and shall be true and correct on the Closing Date with the same force and effect as if they had been made on and as of said date. (b) Conditions Fulfilled. The conditions set forth in -------------------- Subsections (b) and (c) of Section 5.1 shall have been fulfilled. 6. Covenants of the Company. The Company hereby covenants and agrees as ------------------------ follows: 6.1. Financial Information. Until the first to occur of (a) the date -------------------- on which the Company is required to file a report with the SEC pursuant to Section 13(a) of the Exchange Act, by reason of the Company having registered any of its securities pursuant to Section 12(g) of the Exchange Act or (b) quotations for the Common Stock of the Company are reported by the automated quotations system operated by the National Association of Securities Dealers, Inc. or by an equivalent quotations system or (c) shares of the Common Stock of the Company are listed on a national securities exchange registered under Section 6 of the Exchange Act, the Company will furnish to each Purchaser: (a) as soon as practicable after the end of each fiscal year, and in any event within 150 days thereafter, consolidated balance sheets of the Company and its subsidiaries, if any, as at the end of such fiscal year, and consolidated statements of operations and consolidated statements of cash flow of the Company and its subsidiaries, if any, for such year, prepared in accordance with generally accepted accounting principles, all in reasonable detail and certified by a "Big Six" accounting firm selected by the Board of Directors, and 12 (b) as soon as practicable after the end of each month, and in any event within 30 days thereafter, consolidated balance sheets of the Company and its subsidiaries, if any, as of the end of such month, and consolidated statements of income and consolidated cash flow statements, for such month and for the current fiscal year to date, prepared in accordance with generally accepted accounting principles (except for required footnotes), all in reasonable detail and signed, subject to changes resulting from year-end audit adjustments, by the principal financial officer or chief executive officer of the Company, and (c) as soon as practicable after its adoption or approval by the Company's Board of Directors, but not later than the commencement of such fiscal year, an annual budget and operating plan for each fiscal year which shall include monthly capital and operating expense budgets, cash flow statements, projected balance sheets and profit and loss projections for each such month and for the end of the year, itemized in such detail as the Board of Directors may reasonably determine. Each Purchaser agrees not to disclose the information provided it pursuant to this Section to any person, real or legal, except as provided or authorized herein. The Purchasers may disclose such information to persons who have a need to know, such as limited partners, directors, trustees, management employees, witnesses, experts, investors, attorneys, lenders, and insurers. Notwithstanding the foregoing, the Purchasers may disclose such information pursuant to the requirement of a governmental agency or operation of law, provided that the Purchasers are obligated to use reasonable efforts to prevent disclosure under such circumstances 6.2. Conflicts of Interests. The Company shall use its best efforts ---------------------- to ensure that the Company's employees, during the term of their employment with the Company, do not engage in activities which would result in a conflict of interest with the Company. The Company's obligations hereunder include, but are not limited to, requiring that the Company's fulltime employees devote their primary productive time, ability and attention to the business of the Company (provided, however, the Company's employees may engage in other professional activity if such activity does not materially interfere with their obligations to the Company), requiring that the Company's employees enter into agreements regarding proprietary information and confidentiality and preventing the Company's employees from engaging or participating in any business that is in competition with the business of the Company while employed by the Company. 6.3. Proprietary Agreements. The Company will use its best efforts to ---------------------- prevent any employee from violating the confidentiality and proprietary information agreement entered into between the Company and each of its employees. 6.4. Future Stock Issuances. The Company will not issue any shares of ---------------------- Common Stock (or grant any options, warrants or other rights to purchase the same) to any employee, officer, director, consultant or equipment lessor (i) except pursuant to written agreements which provide for vesting over a period of at least forty-eight (48) months (with the initial vesting date to occur at least after twelve (12) months) and a right of first refusal in favor of the Company in the event of any proposed transfer, or (ii) if such issuance or grant causes the aggregate number of shares of Common Stock issued and granted to the Company's employees, officers, directors, consultants or equipment lessors to exceed 1,719,909; provided further that no ---------------- 13 more than 225,000 shares of Common Stock (or options, warrants or other rights to purchase the same) may be granted to employees, officers, directors or consultants or equipment lessors of the Company who are employed, elected or retained by the Company as of the date of this Agreement, unless such issuance or grant is approved by the Purchasers holding a majority of the Shares. 6.5. Use of Proceeds. The proceeds shall be used for working capital --------------- purposes. 6.6. Inspection Rights. Each Purchaser shall have the right to visit ----------------- and inspect any of the properties of the Company or any of its subsidiaries, and to discuss the affairs, finances and accounts of the Company or any of its subsidiaries with its officers, all at such reasonable times and as often as may be reasonably requested; provided, however, that the Company shall not be obligated under this Section 6.6 with respect to a competitor of the Company or with respect to information which the Board of Directors determines in good faith is confidential and should not, therefore be disclosed. 6.7. Reservation of Common Stock. The Company will at all times --------------------------- reserve and keep available, solely for issuance and delivery upon the conversion of the Shares and exercise of the Warrants, all Class A and Class B Common Stock issuable from time to time upon such conversion or exercise. 6.8. Dealings with Affiliates and Others. Except the Company's ----------------------------------- leasing of space in the building currently occupied by the Company at 9888 Carroll Centre Road, San Diego, California from COMPS Plaza Associates, a California limited partnership, the Company will not enter into any transaction including, without limitation, any loans or extensions of credit or royalty agreements, with any officer or director of the Company or any subsidiary or holder of any class of capital stock of the Company, or any member of their respective immediate families or any corporation or other entity directly or indirectly controlled by one or more of such officers, directors or stockholders or members of their immediate families (other than any such transactions in the ordinary course of business which are in an amount not in excess of $25,000) unless such transaction is approved in advance by a majority of the members of the Board of Directors who are disinterested with respect to that transaction. 6.9. Termination of Covenants. All covenants of the Company contained ------------------------ in Section 6 of this Agreement shall expire and terminate as to each Purchaser after the time of effectiveness of the Company's first underwritten public offering registered under the Securities Act. 7. Dispute Resolution. ------------------ 7.1. Arbitration. The parties acknowledge and agree that time is of the essence in resolving any dispute that may arise in connection with this Agreement. Except as set forth herein, any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be settled by binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"). The expenses of the arbitration, including the arbitrator's fees, expert witness fees, and attorney's fees, may be awarded to the prevailing party, in the 14 discretion of the arbitrator, or may be apportioned between the parties in any manner deemed appropriate by the arbitrator. Unless and until the arbitrator decides that one party is to pay for all (or a share) of such expenses, the Company shall pay all reasonable expenses, including legal and accounting fees and costs arising in connection with enforcement of this Agreement or the Collateral Agreements. The parties shall keep confidential the decision of the arbitrator. Notwithstanding the foregoing the parties may disclose information about such decision to persons who have a need to know, such as limited partners, directors, trustees, management employees, witnesses, experts, investors, attorneys, lenders, insurers, and others who may be affected. Additionally, if a party has stock which is publicly traded, the party may make such disclosures as are required by applicable securities laws. Once the arbitration award has become final, if the arbitration award is not promptly satisfied, then these confidentiality provisions shall no longer be applicable. 7.2. Specific Performance. Notwithstanding Section 7.1 hereof, the -------------------- parties will be entitled to enforce their rights under this Agreement specifically (without posting a bond or other security). The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and any party may in its sole discretion apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive relief in order to enforce or prevent any violation of the provisions of this Agreement. 8. Miscellaneous. ------------- 8.1. Waivers and Amendments. With the written consent of the Company ---------------------- and the record holders of at least a majority of the Shares, the obligations of the Company and Purchasers under this Agreement may be waived or amended (either generally or in a particular instance). Upon the effectuation of each such waiver or amendment, the Company shall promptly give written notice thereof to the record holders of the Shares who have not previously consented thereto in writing. Except to the extent provided in this Subsection 8.1, this Agreement or any provision hereof may be amended, waived, discharged or terminated only by a statement in writing signed by the party against which enforcement of the amendment, waiver, discharge or termination is sought. 8.2. Governing Law. This Agreement shall be governed in all respects ------------- by the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely within California. 8.3. Survival. The representations, warranties, covenants and -------- agreements made herein shall survive the Closing, notwithstanding any investigation made by the Purchaser. All statements as to factual matters contained in any certificate or other instrument delivered by or on behalf of the Company pursuant hereto or in connection with the transactions contemplated hereby shall be deemed to be representations and warranties by the Company hereunder as of the date of such certificate or instrument. 8.4. Successors and Assigns. Except as otherwise expressly provided ---------------------- herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors and administrators of the parties hereto. 15 8.5. Entire Agreement. This Agreement and the Collateral Agreements ---------------- and other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof and they supersede, merge and render void every other prior written and/or oral understanding or agreement among or between the parties hereto. 8.6. Notices, Etc. All notices and other communications required or ------------ permitted hereunder shall be in writing and shall be delivered personally, mailed by first class mail, postage prepaid, or delivered by courier or overnight delivery, addressed (a) if to a Purchaser, at such Purchaser's address set forth in the Schedule of Purchasers, or at such other address as such Purchaser shall have furnished to the Company in writing or (b) if to the Company, at its address set forth at the beginning of this Agreement, or at such other address as the Company shall have furnished to each Purchaser in writing. Notices that are mailed shall be deemed received five (5) days after deposit in the United States mail. 8.7. Severability. In case any provision of this Agreement shall be ------------ found by a court of law to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions of this Agreement shall not in any way be affected or impaired thereby. 8.8. Finder's Fees and Other Fees. ---------------------------- (a) The Company (i) represents and warrants that it has retained no finder or broker in connection with the transactions contemplated by this Agreement and, (ii) hereby agrees to indemnify and to hold Purchasers harmless from and against any liability for commission or compensation in the nature of a finder's fee to any broker or other person or firm (and the costs and expenses of defending against such liability or asserted liability) for which the Company, or any of its employees or representatives, is responsible. (b) Each Purchaser (i) represents and warrants that it has retained no finder or broker in connection with the transactions contemplated by this Agreement and (ii) hereby agrees to indemnify and to hold the Company harmless from and against any liability for any commission or compensation in the nature of a finder's fee to any broker or other person or firm (and the costs and expenses of defending against such liability or asserted liability) for which Purchaser, or any of its employees or representatives, are responsible. 8.9. Expenses. The Company and the Purchasers shall each bear their -------- own expenses and legal fees in connection with the consummation of this transaction; provided, however, that the Company will pay the reasonable fees of one special counsel for the Purchaser, together with disbursements and expenses incurred by special counsel in connection with all transactions leading up to and including the Closing. Upon and following the Closing, and subject to the provisions of Section 7 hereof, the Company shall pay all reasonable expenses, including legal and accounting fees and costs arising in connection with enforcement of this Agreement or the Collateral Agreements. 8.10. Titles and Subtitles. The titles of the sections and -------------------- subsections of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement. 16 8.11. Counterparts. This Agreement may be executed in any number of ------------ counterparts, each of which shall be an original, but all of which together shall constitute one instrument. 8.12. Delays or Omissions. No delay or omission to exercise any right, ------------------- power or remedy accruing to the Company or to any holder of any securities issued or to be issued hereunder shall impair any such right, power or remedy of the Company or such holder, nor shall it be construed to be a waiver of any breach or default under this Agreement, or an acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any delay or omission to exercise any right, power or remedy or any waiver of any single breach or default be deemed a waiver of any other right, power or remedy or breach or default theretofore or thereafter occurring. All remedies, either under this Agreement, or by law otherwise afforded to the Company or any holder, shall be cumulative and not alternative. 8.13. Publicity. The Company and each of the Purchasers agree that --------- they will not issue any press release or other public announcement regarding the execution of this Agreement and the closing of the transactions contemplated hereunder, without the prior written consent of the other parties to this Agreement. 17 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above. COMPS INFOSYSTEMS, INC. By: /s/ Christopher A. Crane ------------------------------------- Christopher A. Crane President SUMMIT VENTURES III, L.P. By: Summit Partners III L.P., its General Partner By: Stamps, Woodsum & Co., III its General Partner By: /s/ Gregory M. Avis ------------------------------------ Gregory M. Avis, General Partner SUMMIT INVESTORS II, L.P. By: /s/ Gregory M. Avis ------------------------------------ Gregory M. Avis, General Partner Christopher A. Crane /s/ Christopher A. Crane ----------------------------------------- Christopher A. Crane Merrill Oster /s/ Merrill Oster ----------------------------------------- Merrill Oster EXHIBIT A Schedule of Purchasers
Series B Preferred Shares Subject to ------------------ ----------------- Stock Warrants Purchase Price ----- -------- -------------- Summit Ventures III, L.P. 543,508 292,658 shares of $ 980,000 499 Hamilton Ave., Suite 200 Class B (non-voting) Palo Alto, CA 94301 Common Stock Attention: Greg Avis - -------------------- Summit Investors II, L.P. 11,092 5,973 shares of $ 20,000 499 Hamilton Ave., Suite 200 Class B (non-voting) Palo Alto, CA 94301 Common Stock Attention: Greg Avis - -------------------- Christopher A. Crane 69,325 37,329 shares of $ 125,000 c/o COMPS InfoSystems, Inc. Class A (voting) 9888 Carroll Centre Rd., Suite 100 Common Stock San Diego, CA 92126-4581 Merrill Oster 13,865 7,466 shares of $ 25,000 c/o COMPS InfoSystems, Inc. Class B (non-voting) 9888 Carroll Centre Rd., Suite 100 Common Stock San Diego, CA 92126-4581 Totals: 637,790 $1,150,000.00
EXHIBIT B-1 Form of Summit/Oster Warrant THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT OR (ii) IN COMPLIANCE WITH RULE 144; OR (iii) PURSUANT TO AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION. Warrant No. W-5 CLASS B COMMON STOCK WARRANT OF COMPS INFOSYSTEMS, INC. ----------------------- THIS CERTIFIES THAT, for value received, Summit Ventures III, L.P. (the "Holder") is entitled to subscribe for and to purchase from COMPS INFOSYSTEMS, INC., a Delaware corporation (the "Company"), 292,658 shares of the non-voting Class B Common Stock of the Company, at the price per share set forth in Section 1 hereof, payable in cash or check (such price being referred to herein as the "Exercise Price" and subject to adjustment as set forth Section 2 below), at any time or from time to time following the occurrence of any of the events described in Section 3 hereof and during the term as set forth below. 1. Exercise Price. The Exercise Price shall be $.01 per share. -------------- 2. Adjustments for Subdivisions, Dividends, Combinations or -------------------------------------------------------- Consolidation of Common Stock. - ----------------------------- a. Subdivisions, Dividends. Consolidations. In the event (i) the --------------------------------------- outstanding shares of the Class B Common Stock shall be increased (by stock split, stock dividend or otherwise), into a greater number of shares of Class B Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such increase, be proportionately decreased; and (ii) the outstanding shares of Class B Common Stock shall be decreased, by reclassification or otherwise, into a lesser number of shares of Class B Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such decrease, be proportionately increased. In the event that the Exercise Price is adjusted pursuant to this Subsection, the number of shares of Class B Common Stock issuable pursuant to this Warrant shall be increased or decreased to a number determined by multiplying (1) the number of shares of Class B Common Stock issuable pursuant to this Warrant immediately prior to the adjustment by (2) a fraction, the numerator of which shall equal the Exercise Price in effect immediately prior to the adjustment and the denominator of which shall equal the Exercise Price in effect immediately after the adjustment. b. Reclassification, Reorganization and Consolidation In case of -------------------------------------------------- any reclassification, capital reorganization or change in the Class B Common Stock of the Company (other than as a result of a subdivision, combination or stock dividend provided for in Section 1 2(a) above), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the holder of this Warrant, so that the holder of this Warrant shall have the right, commencing upon the times set forth in Section 3, and prior to the expiration of this Warrant, to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization or change by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such reclassification, reorganization or change. In any such case appropriate provisions shall be made with respect to the rights and interests of the holder of this Warrant so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per share payable hereunder, provided the aggregate purchase price shall remain the same. c. Conversion of Class B Common Stock. If at any time prior to the ---------------------------------- expiration of this Warrant, all of the Company's then outstanding Class B Common Stock is converted into shares of the Company's Class A Common Stock, then this Warrant shall immediately become exercisable for that number of shares of Class A Common Stock receivable upon conversion by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such conversion, and the Exercise Price shall be immediately adjusted to equal the quotient obtained by dividing (x) the aggregate Exercise Price of the maximum number of shares of Class B Common Stock for which this Warrant was exercisable immediately prior to such conversion, by (y) the number of shares of Class A Common Stock for which this Warrant is exercisable immediately after such conversion. After any such conversion, all references herein to Class B Common Stock shall be deemed to be references to Common Stock. d. Notice of Adjustment. When any adjustment is required to be -------------------- made in the number or kind of shares purchasable upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the number of shares of Common Stock or other securities or property thereafter purchasable upon exercise of the Warrant. 3. Exercise of Warrant. This Warrant may be exercised in whole or in ------------------- part, commencing (i) one day prior to the earlier of the closing or the effective time of a "Liquidity Event," as defined herein; or, (ii) if earlier, October 14, 2001, by the surrender of this Warrant and payment to the Company by cash or check of the Exercise Price for all of the Shares purchased. The Company shall, within ten (10) days after such delivery, (a) prepare and issue a certificate for the Shares purchased in the name of the Holder of this Warrant, or as such Holder may direct (subject to the restrictions upon transfer contained herein and upon payment by such Holder hereof of any applicable transfer taxes) and (b) prepare and issue a new warrant of like terms if this Warrant is exercised for less than all of the Shares subject hereto. "Liquidity Event" shall mean (i) an acquisition, consolidation or merger of the Company with or into any other corporation or corporations unless the stockholders of the Company prior to such transaction directly or indirectly own more than fifty percent (50%) of the voting stock of the surviving or acquiring corporation or corporations; (ii) the sale, transfer or other disposition of all or substantially all of the assets of the Company to a person other than a corporation or partnership 2 controlled by the Company or its stockholders; (iii) the effectuation by the Company of a transaction or series of related transactions in which more than fifty percent (50%) of the outstanding voting power of the Company prior to such transaction or series of related transactions, is disposed of; and (iv) the closing of the sale of the Company's securities pursuant to an underwritten public offering. a. Net Issue Exercise. Notwithstanding any provisions herein to the ------------------ contrary, in lieu of exercising this Warrant for cash, the Holder may elect to receive shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company together with a properly endorsed notice of exercise and notice of such election in which event the Company shall issue to the Holder a number of shares of Class B Common Stock computed using the following formula: Y(A-B) ------ X = A Where X = the number of shares of Class B Common Stock to be issued to the Holder, Y = the number of shares of Class B Common Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being canceled (at the date of such calculation), A = the fair market value of one share of the Company's Class A Common Stock (at the date of such calculation), and B = the Exercise Price (as adjusted to the date of such calculation). For purposes of the above calculation, fair market value of one share of Class A Common Stock shall be determined by the Company's Board of Directors in good faith; provided, however, that where there exists a public market for the Company's Class A Common Stock at the time of such exercise, fair market value shall mean the average over the preceding twenty (20) trading days (or such fewer number of days as such public market has existed) of the mean of the high closing bid and asked prices on the over-the-counter market as reported by Nasdaq, or if then traded on a national securities exchange or the Nasdaq National Market, the average over the preceding twenty (20) trading days (or such fewer number of days as the Class A Common Stock has been so traded) of the mean of the high and low prices on the principal national securities exchange or the National Market on which it is so traded. Notwithstanding the foregoing, in the event the Warrant is exercised in connection with the Company's initial public offering of Common Stock, the fair market value per share shall be the per share offering price to the public of the Company's initial public offering. 4. Term of Warrant. This Warrant expires and shall no --------------- longer be exercisable as of 11:59 p.m. Pacific standard time, February 6, 2008, and shall be void thereafter. 5. Conditions to Exercise of Warrant or Transfer of the Shares. It ----------------------------------------------------------- shall be a condition to any exercise of this Warrant that the Company shall have received, at the time of is such exercise, a representation in writing that the Shares being issued upon such exercise are 3 being acquired for investment and not with a view to any sale or distribution thereof, or a statement of the pertinent facts covering any proposed distribution thereof. It shall be a condition to any transfer of any or all of the Shares issued upon exercise of this Warrant, other than a transfer registered under the Securities Act of 1933, as amended (the "Act"), that the Company shall have received a legal opinion, in form and substance reasonably satisfactory to the Company and its counsel, reciting the pertinent circumstances surrounding the proposed transfer and stating that such transfer is exempt from the prospectus and the registration requirement of the Act. Each certificate evidencing the Shares issued upon exercise of this Warrant, or upon any transfer of such shares (other than a transfer registered under the Act or any subsequent transfer of shares so registered) shall, at the option of the Company, contain a legend, in form and substance satisfactory to the Company and its counsel, restricting the transfer of such shares to sales or other dispositions exempt from the requirements of the Act. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144, other than opinions with regard to sales under Rule 144(k). 6. Fractional Shares. This Warrant shall in no event be exercisable for ----------------- fractional shares, and in lieu thereof, the number of shares which would otherwise be purchased under this Warrant shall be rounded up to the nearest whole share of Common Stock. 7. Miscellaneous. ------------- a. The Company covenants that it will at all times reserve and keep available, solely for the purpose of issuance upon the exercise hereof, a sufficient number of shares of Class A or Class B Common Stock, as applicable, to permit the exercise hereof in full. Such shares when issued in compliance with the provisions of this Warrant and the Certificate of Incorporation, as amended, will be duly authorized, validly issued, fully paid and nonassessable. b. The terms of this Warrant shall be binding upon and shall inure to the benefit of any successors or assigns of the Holder hereof and of the Shares issued or issuable upon the exercise hereto. c. The Holder, as such, shall not be entitled to vote or receive dividends or be deemed to be a shareholder of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, as such, any rights of a shareholder of the Company or any right to vote, give or withhold consent to any corporate action, receive notice of meetings, receive dividends or subscription rights, or otherwise. d. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to the foregoing terms and conditions. e. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction, upon delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation, upon surrender and cancellation of such Warrant, the Company at its expense will execute and deliver, in lieu thereof, a new Warrant of like date and tenor. 4 f. This Warrant shall be governed by the internal laws of the State of California. IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized officer. Dated: February __ 1998 COMPS INFOSYSTEMS, INC. By: ____________________________ Christopher A. Crane President 5 EXHIBIT B-2 Form of Crane Warrant THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT OR (ii) IN COMPLIANCE WITH RULE 144, OR (iii) PURSUANT TO AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION. Warrant No. W-A1 CLASS A COMMON STOCK WARRANT OF COMPS INFOSYSTEMS, INC. ----------------------- THIS CERTIFIES THAT, for value received, Christopher A. Crane (the "Holder") is entitled to subscribe for and to purchase from COMPS INFOSYSTEMS INC., a Delaware corporation (the "Company"), 37,329 shares of the voting Class A Common Stock of the Company, at the price per share set forth in Section 1 hereof payable in cash or check (such price being referred to herein as the "Exercise Price" and subject to adjustment as set forth Section 2 below), at any time or from time to time following the date hereof and during the term as set forth below. 1. Exercise Price. The Exercise Price shall be $.01 per share. -------------- 2. Adjustments for Subdivisions, Dividends, Combinations or Consolidation ---------------------------------------------------------------------- of Common Stock. - --------------- a. Subdivisions, Dividends, Consolidations. In the event (i) the --------------------------------------- outstanding shares of the Class A Common Stock shall be increased (by stock split, stock dividend or otherwise), into a greater number of shares of Class A Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such increase, be proportionately decreased, and (ii) the outstanding shares of Class A Common Stock shall be decreased, by reclassification or otherwise, into a lesser number of shares of Class A Common Stock, the Exercise Price then in effect shall concurrently with the effectiveness of such decrease, be proportionately increased. In the event that the Exercise Price is adjusted pursuant to this Subsection, the number of shares of Class A Common Stock issuable pursuant to this Warrant shall be increased or decreased to a number determined by multiplying (1) the number of shares of Class A Common Stock issuable pursuant to this Warrant immediately prior to the adjustment by (2) a fraction, the numerator of which shall equal the Exercise Price in effect immediately prior to the adjustment and the denominator of which shall equal the Exercise Price in effect immediately after the adjustment. b. Reclassification. Reorganization and Consolidation. In case of -------------------------------------------------- any reclassification, capital reorganization or change in the Class A Common Stock of the Company (other than as a result of a subdivision, combination or stock dividend provided for in Section 1 2(a) above), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the holder of this Warrant, so that the holder of this Warrant shall have the right, prior to the expiration of this Warrant, to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization or change by a holder of the same number of shares of Class A Common Stock as were subject to this Warrant immediately prior to such reclassification, reorganization or change. In any such case appropriate provisions shall be made with respect to the rights and interests of the holder of this Warrant so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per share payable hereunder, provided the aggregate purchase price shall remain the same. c. Notice of Adjustment. When any adjustment is required to be made -------------------- in the number or kind of shares purchasable upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the number of shares of Common Stock or other securities or property thereafter purchasable upon exercise of the Warrant. 3 Exercise of Warrant. The Holder may exercise this Warrant in whole or ------------------- in part by its surrender to the Company and payment to the Company by cash or check of the Exercise Price for all of the Shares purchased. The Company, shall within ten (10) days after such delivery, (a) prepare and issue a certificate for the Shares purchased in the name of the Holder of this Warrant, or as such Holder may direct (subject to the restrictions upon transfer contained herein and upon payment by such Holder hereof of any applicable transfer taxes) and (b) prepare and issue a new warrant of like terms if this Warrant is exercised for less than all of the Shares subject hereto. a. Net Issue Exercise. Notwithstanding any provisions herein to the ------------------ contrary, in lieu of exercising this Warrant for cash, the Holder may elect to receive shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company together with a property endorsed notice of exercise and notice of such election in which event the Company shall issue to the Holder a number of shares of Class A Common Stock computed using the following formula: Y(A-B) ------ X = A Where X = the number of shares of Class A Common Stock to be issued to the Holder, Y = the number of shares of Class A Common Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being canceled (at the date of such calculation), 2 A = the fair market value of one share of the Company's Class A Common Stock (at the date of such calculation), and B = the Exercise Price (as adjusted to the date of such calculation). For purposes of the above calculation, fair market value of one share of Class A Common Stock shall be determined by the Company's Board of Directors in good faith; provided, however. that where there exists a public market for the Company's Class A Common Stock at the time of such exercise, fair market value shall mean the average over the preceding twenty (20) trading days (or such fewer number of days as such public market has existed) of the mean of the high closing bid and asked prices on the over-the-counter market as reported by Nasdaq, or if then traded on a national securities exchange or the Nasdaq National Market, the average over the preceding twenty (20) trading days (or such fewer number of days as the Class A Common Stock has been so traded) of the mean of the high and low prices on the principal national securities exchange or the National Market on which it is so traded. Notwithstanding the foregoing, in the event the Warrant is exercised in connection with the Company's initial public offering of Common Stock, the fair market value per share shall be the per share offering price to the public of the Company's initial public offering. 4. Term of Warrant. This Warrant expires and shall no longer be --------------- exercisable as of 11:59 p.m. Pacific standard time, February 6, 2008, and shall be void thereafter. 5. Conditions to Exercise of Warrant or Transfer of the Shares. It ----------------------------------------------------------- shall be a condition to any exercise of this Warrant that the Company shall have received, at the time of such exercise, a representation in writing that the Shares being issued upon such exercise are being acquired for investment and not with a view to any sale or distribution thereof, or a statement of the pertinent facts covering any proposed distribution thereof. It shall be a condition to any transfer of any or all of the Shares issued upon exercise of this Warrant, other than a transfer registered under the Securities Act of 1933, as amended (the "Act"), that the Company shall have received a legal opinion, in form and substance reasonably satisfactory to the Company and its counsel, reciting the pertinent circumstances surrounding the proposed transfer and stating that such transfer is exempt from the prospectus and the registration requirement of the Act. Each certificate evidencing the Shares issued upon exercise of this Wanant, or upon any transfer of such shares (other than a transfer registered under the Act or any subsequent transfer of shares so registered) shall, at the option of the Company, contain a legend, in form and substance satisfactory to the Company and its counsel, restricting the transfer of such shares to sales or other dispositions exempt from the requirements of the Act. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144, other than opinions with regard to sales under Rule 144(k). 6. Fractional Shares. This Warrant shall in no event be exercisable for ----------------- fractional shares, and in lieu thereof, the number of shares which would otherwise be purchased under this Warrant shall be rounded up to the nearest whole share of Common Stock. 3 7. Miscellaneous. ------------- a. The Company covenants that it will at all times reserve and keep available, solely for the purpose of issuance upon the exercise hereof, a sufficient number of shares of Class A Common Stock to permit the exercise hereof in full. Such shares when issued in compliance with the provisions of this Warrant and the Certificate of Incorporation, as amended, will be duly authorized, validly issued, fully paid and nonassessable. b. The terms of this Warrant shall be binding upon and shall inure to the benefit of any successors or assigns of the Holder hereof and of the Shares issued or issuable upon the exercise hereto. c. The Holder, as such, shall not be entitled to vote or receive dividends or be deemed to be a shareholder of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, as such, any rights of a shareholder of the Company or any right to vote, give or withhold consent to any corporate action, receive notice of meetings, receive dividends or subscription rights, or otherwise. d. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to the foregoing terms and conditions. e. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction, upon delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation, upon surrender and cancellation of such Warrant, the Company at its expense will execute and deliver, in lieu thereof a new Warrant of like date and tenor. f. This Warrant shall be governed by the internal laws of the State of California. IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized officer. Dated: February ___, 1998 COMPS INFOSYSTEMS, INC. By: ____________________________ Robert C. Beasley Secretary 4 EXHIBIT C Schedule of Exceptions EXHIBIT C TO PURCHASE AGREEMENT ------------------------------- 3.1. Organization and Standing: Articles and Bylaws. The Company is ---------------------------------------------- intentionally not qualified to do business in Arizona, Colorado, Florida, Georgia, Illinois, Maryland, Massachusetts, Nevada, New York, Texas, Virginia, Washington and Washington, D.C. The Company believes that its failure to qualify in such states does not have a material adverse effect upon the Company. The Company intends to qualify the Delaware corporation to do business in such states as it deems necessary. 3.5 Authorization; Pre-emptive Right. Pursuant to the terms of a -------------------------------- Stockholder Buyout and Voting Agreement among Beasley, Crane and Summit, Crane and Summit have certain rights of first refusal with respect to Beasley's shares of Series A Common Stock. Pursuant to the terms of a Stockholder Voting Agreement among Merrill Oster and Crane, Crane has certain rights of first refusal with respect to Mr. Oster's shares of the Company's Stock. The Company has a right of first refusal with respect to the shares of Common Stock issuable upon the exercise of options under the Company's Stock Option Plan. 3.6 Patents, Trademarks. ------------------- 3.6.1. Infringement: The Company occasionally discovers minor ------------ infringement on its copyright (i.e., persons photocopying reports). Confronting infringers generally has been successful in causing them to cease. The Company has not had to file any suits in this regard. 3.6.2 Trademark Protection. The Company has trademark protection -------------------- on the name "COMPS," but has not obtained such protection on its full corporate name, "COMPS InfoSystems, Inc." 3.8 Proprietary Agreements: Employees: A list of the employees that have --------------------------------- not executed non-disclosure/confidentiality agreements is attached hereto as Exhibit 3.8. 3.9 Litigation, etc. There is no existing or threatened litigation . --------------- 3.13 Title. Venture Lending and Leasing, Inc. holds a first lien on all ----- assets as a result of a $3.0 million loan agreement the Company entered into in September 1996 in the ordinary course of business. 3.16 Absence of Changes ------------------ 3.16.1 Employees and Compensation. Employment agreements have been -------------------------- executed by all officers. The Company has entered into indemnification agreements with each of its officers and directors. See Exhibit "H" to Purchase Agreement. 3.16.2 Resignations, Terminations. The Company terminated three -------------------------- vice presidents - one in August 1996, one in September 1996, and one in January 1997. 3.17 Outstanding Indebtedness. Pursuant to that certain Loan Agreement ------------------------- dated September 24, 1996, the Company is indebted to Venture Lending & Leasing, Inc. in the amount of approximately $2,158,000 as of the Closing. 3.19 Certain Transactions. -------------------- 3.19.1 COMPS Plaza. Beasley has a 5% interest and Crane has a 55% ----------- ownership interest in COMPS Plaza Associates, L.P., which owns the building in which the Company leases space. Crane is the President of Alden Properties, Inc., the corporate general partner of COMPS Plaza Associates, L.P. The limited partnership purchased the building on September 16, 1994. Neither the Company nor Beasley nor Crane are guarantors on the debt on the building. 3.24 Disclosure: Projections. This representation does not apply to any ------------------------ post-1997 projections delivered to Purchaser. 2 Exhibit 3.8 ----------- COMPS InfoSystems, Inc. Employees with Whom the Company Does Not Have Confidentiality and Proprietary Information Agreements: Aspiras, Gloria* August, Caroline* Becker, Aaron* DeMonaco, Tracy* Donado, Cris* Fenton, Christopher* Hitch, Jeff* Larkin, Deb* Nelson, Lori* Pierce, Jeff* Prevo, Dan* Quindara, Belinda* Radovich, Marcella* Range1, Rudolfo* Reisinger, Lori* Ridley, Vicki* Ruiz, Rance* Ryan, Heather* Stevens, Mark* Watson, Laura* Whiles, Wendi* ________________ * Form of the agreement has been provided to Summit. It is anticipated that the actual agreements will be executed shortly after the closing. 3 EXHIBIT D Amended and Restated Investor Rights Agreement See Exhibit 10.1 to Registration Statement on Form S-1 EXHIBIT E Amended and Restated Right of First Refusal and Co-Sale Agreement AMENDED AND RESTATED RIGHT OF FIRST REFUSAL AND CO-SALE AGREEMENT This Amended and Restated Right of First Refusal and Co-Sale Agreement (the "Agreement") is made and entered into as of February 9, 1998, by and among COMPS Infosystems, Inc., a Delaware corporation (the "Company"), Christopher A. Crane, in his individual capacity ("Crane"), Summit Ventures III, L.P., a Delaware limited partnership ("Summit III") and Summit Investors II, L.P., a Delaware limited partnership ("Summit II," and collectively with Summit III, the "Purchasers"), and amends and restates in its entirety that certain Right of First Refusal and Co-Sale Agreement dated as of October 14, 1994 between the Purchasers, Crane and the Company (the "1994 Agreement"). RECITALS -------- WHEREAS, the Purchasers possess certain rights of first refusal and co-sale rights pursuant to the 1994 Agreement. WHEREAS, the Purchasers, Crane and the Company desire to amend and restate, in its entirety, the 1994 Agreement as set forth below. WHEREAS, Crane currently owns shares of the Company's Common Stock (the "Common Stock"), and intends to purchase shares of the Company's Series B Preferred Stock and warrants to purchase shares of the Company's Class A Common Stock pursuant to that certain Stock and Warrant Purchase Agreement entered into by and among the Company and the Purchasers dated of even date herewith (the "Stock and Warrant Purchase Agreement"). WHEREAS, the Purchasers currently own shares of the Company's Series A Preferred Stock and warrants to purchase shares of the Company's Class B Common Stock and intend to purchase from the Company shares of its Series B Preferred Stock and warrants to purchase additional shares of the Company's Class B Common Stock pursuant to the Stock and Warrant Purchase Agreement. WHEREAS, to induce the Purchasers to purchase such shares of stock and warrants from the Company, Crane has agreed to grant the Purchasers certain rights of first refusal and co-sale with respect to Common Stock currently owned by Crane and any other stock of the Company hereafter owned or acquired by Crane, all on the terms and conditions set forth in this Agreement. WHEREAS, the signatories hereto include holders of a majority of the Stock (as defined herein) held by the Purchasers immediately prior to the closing under the Stock and Warrant Purchase Agreement. AGREEMENT --------- NOW, THEREFORE. in consideration of the mutual promises and covenants set forth herein and further other consideration, the receipt and sufficiency of which hereby is 1 acknowledged, the Purchasers, Crane and the Company hereby agree that the 1994 Agreement shall be amended and restated in its entirety as follows: 1. Certain Definitions. For purposes of this Agreement, the following ------------------- terms have the following meanings: (a) "IPO" means the first underwritten sale of Company securities to --- the public pursuant to registration statement under the Securities Act of 1933, as amended, in which the gross proceeds to the Company equal or exceed $10,000,000. (b) "Purchasers' Share" means as to the Right of Co-Sale, the ratio ----------------- determined by dividing (A) the number of shares of Stock (as defined below) held by a Purchaser by (B) the number of shares of Stock held by all Purchasers plus the number of shares of Stock held by Crane. (c) "Offered Stock" means all Stock proposed to be Transferred by ------------- Crane. (d) "Right of Co-Sale" means the right of co-sale provided to the ---------------- Purchasers in Section 4 of this Agreement. (e) "Right of First Refusal" means the right of first refusal provided to the Purchasers in Section 3 of this Agreement. (f) "Stock" means and includes all shares of Common Stock issued and ----- outstanding at the relevant time plus (i) all shares of Common Stock that may be issued upon exercise of any options, warrants and other rights of any kind that are then exercisable, and (ii) all shares of Common Stock that may be issued upon conversion of (A) any convertible securities, including, without limitation, preferred stock and debt securities then outstanding, which are by their terms then convertible into or exchangeable for Common Stock or (B) any such convertible securities issuable upon exercise of options, warrants or other rights that are then exercisable. (g) "Transfer" means and includes any sale, assignment, encumbrance, -------- hypothecation, pledge, conveyance in trust, gift, transfer by bequest, devise or descent, or other transfer or disposition of any kind, including but not limited to transfers to receivers, levying creditors, trustees or receivers in bankruptcy proceedings or general assignees for the benefit of creditors, whether voluntary or by operation of law, directly or indirectly, except: (i) any bona fide pledge if the pledgee executes a counterpart copy of this Agreement and becomes bound thereby in the same manner as Crane; (ii) any transfers of Stock by Crane to Crane's spouse, lineal descendant or antecedent, father, mother, brother or sister of Crane, the adopted child or adopted grandchild of Crane, or the spouse of any child, adopted child, grandchild or adopted grandchild of Crane, or to a trust or trusts for the exclusive benefit of Crane or Crane's family members as described in this Section, or transfers of Stock by Crane by devise or descent, in all cases if the transferee or other recipient executes a counterpart copy of this Agreement and becomes bound thereby in the same manner as Crane; 2 (iii) any transfer of Stock by Crane made: (A) pursuant to a merger or consolidation of the Company with or into another corporation or corporations; (B) pursuant to the winding up and dissolution of the Company; (C) at, and pursuant to, the IPO; or (D) to a Purchaser pursuant to this Agreement; or (iv) any bona fide gift to not-for-profit organizations. 2. Notice of Proposed Transfer. Before Crane may effect any Transfer of --------------------------- any Stock. Crane must give at the same time to the Company and the Purchasers a written notice signed by Crane ("Crane's Notice") stating (a) Crane's bona fide intention to transfer such Offered Stock; (b) the number of shares of the Offered Stock; (c) the name, address and relationship, if any, to Crane of each proposed purchaser or other transferee; and (d) the bona fide cash price or, in reasonable detail, other consideration, per share for which Crane proposes to transfer such Offered Stock (the "Offered Price"). Upon the request of a Purchaser, Crane will promptly furnish such information, to the Purchasers, as may be reasonably requested to establish that the offer and proposed transferee are bona fide. 3. Right of First Refusal. ---------------------- (a) Purchasers' Right. With respect to any Transfer by Crane, the ----------------- Purchasers shall have the right of first refusal to purchase all or any part of the Offered Stock, exercisable as set forth in Subsection (b) hereof. (b) Exercise of Purchasers' Right of First Refusal. The Purchasers' ---------------------------------------------- Right of First Refusal may be exercised as follows: (i) Each Purchaser shall have the opportunity to purchase all or any part of its pro rata share of Offered Stock. A Purchaser's pro-rata share shall be determined by dividing the number of shares of Stock held by a Purchaser by the total number of shares of Stock held by all Purchasers. The Purchasers shall be entitled to apportion Offered Stock to be purchased among its partners and affiliates, provided that such Purchaser notifies Crane of such allocation, and provided that such allocation does not threaten the Company's ability to rely upon an exemption from the registration provisions of the Act or the qualification provisions of applicable blue-sky laws. In addition, a Purchaser shall be entitled to assign its rights under this Section 3 to the Company. (ii) If any Purchaser or its assignees desires to purchase all or any part of the Offered Stock, such Purchaser must, within the twenty (20) day period (the "Purchaser Refusal Period") commencing on the date of Crane's Notice, give written notice to Crane and to the Company of such Purchaser's election to purchase Offered Stock. In the event that any Purchaser elects not to purchase its pro-rata share of the Offered Stock, such shares may be purchased by the other Purchasers. (iii) Within ten (10) days after expiration of the Purchaser Refusal Period, the Company will give written notice (the "Purchasers' Expiration Notice") to Crane and to the Purchasers specifying either (A) that Offered Stock was subscribed by the Purchasers exercising their Rights of First Refusal or (B) that the Purchasers do not have the right to purchase any of the Offered Stock because the Purchasers did not timely exercise their Right of 3 First Refusal to purchase Offered Stock, in which case the Purchasers' Expiration Notice will specify each Purchaser's Share of the Offered Stock with respect to the Right of Co-Sale. (c) Purchase Price. The purchase price for the Offered Stock to be -------------- purchased by the Purchasers exercising their Right of First Refusal under this Agreement will be the Offered Price, but will be payable as set forth in Section 3(d) hereof. If the Offered Price includes consideration other than cash, the cash equivalent value of the non-cash consideration will be determined by the Board of Directors of the Company in good faith, which determination will be binding upon the Purchasers and Crane absent fraud or error. (d) Payment. Payment of the purchase price for the Offered Stock ------- purchased by a Purchaser exercising its Right of First Refusal will be made within seven (7) days after the date of the Purchaser's Expiration Notice. Payment of the purchase price will be made by the exercising Purchaser (i) in cash (by check), (ii) by cancellation of all or a portion of any outstanding indebtedness of Crane to the Purchaser or (iii) by any combination of the foregoing. (e) Rights as a Stockholder. If the Purchasers exercise their Rights ----------------------- of First Refusal to Purchase the Offered Stock, then, upon the date the notice of such exercise is given by the Company, Crane will have no further rights as a holder of the Offered Stock except the right to receive payment for the Offered Stock from the Purchasers in accordance with the terms of this Agreement, and Crane will forthwith cause all certificate(s) evidencing such Offered Stock to be surrendered to the Company for transfer to the Purchasers. (f) Crane's Right To Transfer. If the Purchasers have not elected to ------------------------- purchase all of the Offered Stock, then, subject to the Right of Co-Sale, Crane may transfer that portion of the Offered Stock permitted to be sold by Crane, to any person named as a purchaser or other transferee in Crane's Notice, at the Offered Price or at a higher price, provided that such transfer (i) is consummated within ninety (90) days after the date of Crane's Notice and (ii) is in accordance with all the terms of this Agreement. If the Offered Stock is not so transferred during such 90 day period, then Crane may not transfer any of such Offered Stock without complying again in full with the provisions of this Agreement. 4. Right of Co-Sale. ---------------- (a) Right of Co-Sale. If the Purchasers have waived or failed to ---------------- timely exercise their Rights of First Refusal, a Purchaser may transfer to the transferee proposed in Crane's Notice the Purchaser's Share of the Offered Stock, as such Share is specified in the Purchaser's Expiration Notice, by giving written notice to Crane, within ten (10) days after the date of the Purchaser's Expiration Notice, specifying the number of shares and type of Stock that the Purchaser desires to transfer to the transferee. (b) Consummation of Co-Sale. A Purchaser may exercise the Right of ----------------------- Co-Sale by delivering to Crane at the closing of the transfer of Offered Stock to such transferee (the "Closing") one or more certificates, properly endorsed for Transfer, representing such Stock to be Transferred by the Purchaser. At the Closing, such certificates or other instruments will be transferred and delivered to the transferee set forth la Crane's Notice in consummation of the transfer of the Offered Stock pursuant to the terms and conditions specified in such notice, and 4 Crane will remit, or will cause to be remitted, to the Purchaser within seven (7) days after such Closing that portion of the proceeds of the Transfer to which the Purchaser is entitled by reason of the Purchaser's participation in such transfer pursuant to the Right of Co-Sale. 5. Multiple Series, Class or Type of Stock. If the Offered Stock consists --------------------------------------- of more than one series or class or type of Stock, the Purchaser has the right to purchase or transfer hereunder, as the case may be, each such series, class or type; provided, however, that if, as to the Right of Co-Sale, the Purchaser does not hold any of such series, class, or type, and the proposed transferee is not willing, at the Closing, to purchase some other series, class or type of Stock from the Purchaser, or is unwilling to purchase any Stock from the Purchaser at the Closing, then the Purchaser will have the put right (.the "Put Right") set forth in Section 6(b) hereof 6. Refusal to Transfer; Put Right. (a) Refusal to Transfer. Any attempt by Crane to transfer any Stock ------------------- in violation of any provision of this Agreement will be void. The Company will not be required (i) to transfer on its books any Stock that has been sold, gifted or otherwise transferred in violation of this Agreement, or (ii) to treat as owner of such Stock, or to accord the right to vote or pay dividends to any purchaser, donee or other transferee to whom such Stock may have been so transferred. (b) Put Right. If Crane transfers any Stock in contravention of the --------- Purchasers' Right of Co-Sale under this Agreement (a "Prohibited Transfer"), or if the proposed transferee of Offered Stock desires to purchase only the class, series or type of stock offered by Crane or is unwilling to purchase any Stock from the Purchaser and the provisions of Section 5 hereof apply, the Purchaser may, by delivery of written notice to Crane (a "Put Notice") within ten (10) days after (i) the Closing as defined in Subsection 4(b) above, or (ii) the date on which the Purchaser becomes aware of the Prohibited Transfer or the terms thereof require Crane to purchase from the Purchaser for cash or such other consideration as Crane received in the Prohibited Transfer or at the Closing that number of shares of Stock (of the same class, series or type as transferred in the Prohibited Transfer or at the Closing if the Purchaser then owns Stock of such class, series or type; otherwise of Common Stock) having a purchase price equal to the aggregate purchase price the Purchaser would have received in the closing of such Prohibited Transfer if the Purchaser had elected to exercise its right of Co-Sale with respect thereto or in the Closing if the proposed transferee had been willing to purchase the Stock of the Purchaser. The closing of such sale to Crane will occur within seven (7) days after the date of the Purchaser's Put Notice to Crane. 7. Restrictive Legend and Stop-Transfer Orders. ------------------------------------------- (a) Right of First Refusal and Co-Sale Legend. Crane understands and ----------------------------------------- agrees that the Company will cause the legend set forth below, or a legend substantially equivalent thereto, to be placed upon any certificate(s) or other documents or instruments evidencing ownership of Stock by Crane: 5 THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RIGHTS OF FIRST REFUSAL AND RIGHTS OF CO-SALE AS SET FORTH IN AN AMENDED AND RESTATED RIGHT OF FIRST REFUSAL AND CO- SALE AGREEMENT DATED FEBRUARY 6,1998, ENTERED INTO BY THE HOLDER OF THESE SHARES, THE COMPANY AND CERTAIN STOCKHOLDERS OF THE COMPANY. A COPY OF SUCH AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY. SUCH RIGHTS OF FIRST REFUSAL AND RIGHTS OF CO-SALE ARE BINDING ON CERTAIN TRANSFEREES OF THESE SHARES. (b) Stop Transfer Instructions. Crane agrees, to ensure compliance -------------------------- with the restrictions referred to herein, that the Company may issue appropriate "stop transfer" certificates or instructions and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its records. 8. Termination and Waiver. ---------------------- (a) Termination. The Purchasers' Right of First Refusal and the Right ----------- of Co-Sale will terminate upon the earliest to occur of (i) the IPO, (ii) the dissolution of the Company, or (iii) the effective date of a consolidation or merger with or into another corporation as a result of which the stockholders of the Company prior to such transaction own less than 50% of the outstanding stock of the surviving corporation. (b) Waiver. The application of the Purchasers' Right of First Refusal ------ and/or the Right of Co-Sale as to any proposed Transfer by Crane of any Stock may be waived in advance of or after such transfer by the written agreement of the Purchasers. The Purchasers will have the absolute right to exercise or refrain from exercising any right or rights that such party may have by reason of this Agreement, including without limitation the right to purchase or participate in the sale of Offered Stock, and the Purchasers will not incur any liability to any other party hereto with respect to exercising or refraining from exercising any such right or rights. Any waiver by a party of its rights hereunder will be effective only if evidenced by a written instrument executed by such party or its authorized representative. 9. Miscellaneous Provisions. ------------------------ (a) Notice. Any notice required or permitted to be given to a party ------ pursuant to the provisions of this Agreement will be in writing and will be effective and deemed given under this Agreement on the earliest of (i) the date of personal delivery, or (ii) the date of deliver by facsimile, or (iii) the business day after deposit with a nationally-recognized courier or overnight service, including Express Mail, for United States deliveries or three (3) business days after such deposit for deliveries outside of the United States, or (iv) five (5) business days after deposit in the United States mail by registered or certified mail for United States deliveries. All notices not delivered personally or by facsimile will be sent with postage and other charges prepaid and properly addressed to the party to be notified at the address set forth below such party's signature on this Agreement or at such other address as such party may designate by ten (10) days advance written notice to the other parties hereto. All notices for delivery outside the 6 United States will be sent by facsimile, or by nationally recognized courier or overnight service, including Express Mail. Any notice given hereunder to more than one person will be deemed to have been given, for purposes of counting time periods hereunder, on the date given to the last party required to be given such notice. Notices to the Company will be marked to the attention of the President. (b) Binding on Successors and Assigns; Inclusion Within Certain ----------------------------------------------------------- Definitions. This Agreement, and the rights and obligations of the parties - ----------- hereunder will inure to the benefit of, and be binding upon, their respective successors, assigns, heirs, executors, administrators and legal representatives. Any permitted transferee of Crane who is required to become a party hereto will be considered "Crane" for purposes of this Agreement and any permitted transferee of Stock held by a Purchaser will be considered a "Purchaser" for purposes of this Agreement. (c) Severability. If any provision of this Agreement is held to be ------------ invalid, illegal or unenforceable in any respect, such provision will be enforced to the maximum extent possible and such invalidity, illegality or unenforceability will not affect any other provision of this Agreement, and this Agreement will be construed as if such invalid, illegal or unenforceable provision had (to the extent not enforceable) never been contained herein. (d) Amendment. This Agreement may be amended only by a written --------- instrument executed by the Company, the Purchasers holding a majority of the Stock then held by all Purchasers and Crane. (e) Continuity of Other Restrictions. Any Stock not purchased by a -------------------------------- Purchaser under their Right of First Refusal hereunder will continue to be subject to all other restrictions imposed upon such Stock by law, including any restrictions imposed under the Company's Articles of Incorporation or By-laws, or by agreement. (f) Governing Law. This Agreement will be governed by and construed ------------- in accordance with the laws of the State of California, excluding that body of law pertaining to conflict of laws. (g) Obligation of Company; Binding Nature of Exercise. The Company ------------------------------------------------- agrees to use its best efforts to enforce the terms of this Agreement, to inform Crane and the Purchasers of any breach hereof (to the extent the Company has knowledge thereof) and to use reasonable efforts to assist Crane and the Purchasers in the exercise of their rights and the performance of their obligations hereunder. Any exercise of the Right of First Refusal or Right of Co-Sale will be binding upon the party so exercising, and may not be withdrawn without the written consent of Crane, except that such exercise may be withdrawn unilaterally by the exercising party if there is any legal prohibition as to a party s consummation of its purchase or sale hereunder. (h) Counterparts. This Agreement may be executed in any number of ------------ counterparts, each of which when so executed and delivered will be deemed an original, and all such counterparts together will constitute one and the same instrument. (i) Entire Agreement. This Agreement constitutes the entire agreement ---------------- of the parties with respect to the specific subject matter hereof and supersedes in their entirety all other 7 agreements or understandings between or among the parties hereto with respect to such specific subject matter. (j) Conflict. In the event of any conflict between the terms of this -------- Agreement and the Company's Certificate of Incorporation, or its By-laws, the terms of the Company's Certificate of Incorporation, or its By-laws, as the case may be, will control. In the event of any conflict between the terms of this Agreement and any other agreement to which Crane is a party or by which Crane is bound, the terms of this Agreement will control. In the event of any conflict between the Company's books and records and this Agreement or any notice delivered hereunder, the Company's books and records will control absent fraud or error. (k) Dispute Resolution. The parties acknowledge and agree that time ------------------ is of the essence in resolving any dispute that may arise in connection with this Agreement. Except as set forth herein, any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be settled by binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"). The expenses of the arbitration, including the arbitrator's fees, expert witness fees, and attorney's fees, may be awarded to the prevailing party, in the discretion of the arbitrator, or may be apportioned between the parties in any manner deemed appropriate by the arbitrator. Unless and until the arbitrator decides that one party is to pay for all (or a share) of such expenses, the Company shall pay reasonable expenses, including legal and accounting fees and costs arising in connection with enforcement of this Agreement or the Collateral Agreements. The parties shall keep confidential the decision of the arbitrator, however, the parties may disclose information about such decision to persons who have a need to know, such as limited partners, directors, trustees, management employees, witnesses, experts, investors, attorneys, lenders, insurers, and others who may be directly affected. Once the arbitration award has become final, if the arbitration award is not promptly satisfied, then these confidentiality provisions shall no longer be applicable. Notwithstanding the foregoing, the parties will be entitled to enforce their rights under this Agreement specifically (without posting a bond or other security). The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and any party may in its sole discretion apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive relief in order to enforce or prevent any violation of the provisions of this Agreement. 8 IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the date first written above. COMPS INFOSYSTEMS, INC. By: __________________________________ Christopher A. Crane, President Address: 9888 Carroll Centre Road, Ste. 100 San Diego, California 92126-4581 (619) 578-3000 CHRISTOPHER A. CRANE ______________________________________ Christopher A. Crane, in his individual capacity Address: c/o COMPS Infosystems, Inc. 9888 Carroll Centre Road, Suite 100 San Diego, CA 92126-4581 (619) 578-3000 9 PURCHASERS: SUMMIT VENTURES III, L.P. By: Summit Partners III, L.P. its General Partner By: Stamps, Woodsum & Co. III, its General Partner By: _________________________________ Gregory M. Avis, General Partner SUMMIT INVESTORS II, L.P. By: _________________________________ Gregory M. Avis, General Partner Address 499 Hamilton Avenue, Suite 200 Palo Alto, CA 94301 (415) 321-1166 10 EXHIBIT F Amended and Restated Voting Agreement AMENDED AND RESTATED VOTING AGREEMENT THIS AMENDED AND RESTATED VOTING AGREEMENT (the "Agreement") is entered into as of February 9, 1998, by and among COMPS InfoSystems, Inc., a Delaware corporation (the "Company"), Christopher A. Crane ("Crane"), and the purchasers listed on the signature page attached hereto (the "Purchasers"). RECITALS -------- WHEREAS, the Purchasers, Crane and the Company are parties to a Voting Agreement dated as of October 14. 1994 (the " 1994 Agreement"). WHEREAS, the Purchasers, Crane and the Company desire to amend and restate, in its entirety, the 1994 Agreement as set forth below. WHEREAS, Crane is a holder of a majority of the Company's Common Stock and the Purchasers are the holders of all of the Company's Series A Preferred Stock. WHEREAS, as an inducement to the Purchasers to purchase the Series B Preferred Stock of the Company, Crane is executing this Agreement and as an inducement to Crane to execute this Agreement, the Purchasers are executing this Agreement. AGREEMENT --------- NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the Purchasers, Crane and the Company hereby agree that the 1994 Agreement shall be amended and restated as follows: 1. Voting of Shares. Until the termination of this Agreement in ---------------- accordance with Section 4 below, Crane will vote all shares then within his control of the equity securities of the Company with rights to vote in the election of the Company's directors, at any annual or special meeting of the stockholders of the Company, or in any action by written consent of the stockholders of the Company in order to cause and maintain the election to the Board of Directors of one director to be elected by the holders of the Company's Common Stock who is mutually acceptable to Crane and the Purchasers holding a majority of the outstanding Series A Preferred Stock and Series B Preferred Stock voting together as a single class. A nominee shall be deemed to be acceptable to the Purchasers if they have consented in writing to his or her election. 2. Legends on Stock Certificates. The certificates representing shares ----------------------------- held by Crane shall bear the following legend: "The shares represented by this certificate are subject to the limitations, restrictions and other terms and conditions of an Amended and Restated Voting Agreement dated February 9, 1998, on file with the Company." 1 3. Application of Agreement to After-Acquired Shares. All of the ------------------------------------------------- provisions of this Agreement shall apply to, and the term "Shares" as used herein shall include, all of the shares of Common Stock and Preferred Stock of the Company, whether issued before or after the Closing Date (as defined in the Stock and Warrant Purchase Agreement) and all securities issued as a replacement for the Shares or with respect to the Shares as a result of any stock dividend, stock split or other similar event. 4. Term of the Agreement. This Agreement shall terminate on the earlier --------------------- of (a) the consummation by the Company of any underwritten public offering of the Company's securities in which the gross proceeds to the Company equal or exceed $10,000,000 at a purchase price of $3.73 per share (as adjusted for stock splits, stock dividends, reorganizations and the like), (b) the sale of the Company (through a merger, consolidation, sale of all or substantially all of its assets or stock), or (c) the effective time of the liquidation of the Company. 5. Binding Effect on Transferees. This Agreement and all of the terms, ----------------------------- covenants, and conditions herein contained, shall be binding upon and inure to the benefit of all of the parties hereto and their respective transferees, successors, heirs, executors, administrators and assigns. A condition precedent to the transfer of any of the Common Stock of the Company to any third party by Crane is that the transferee shall become a party to this Agreement and shall execute any and all instruments, and take all other actions, necessary to carry out the purposes of this Agreement. Notwithstanding the foregoing, this Agreement shall not bind any transferee of Crane that is a not-for-profit charitable organization, provided, however, that the foregoing exception shall -------- ------- no longer apply following the transfer by Crane of an aggregate of up to 257,000 of the Company's equity securities by Crane to not-for-profit charitable organizations. 6. Severability. Wherever there is any conflict between any provision of ------------ this Agreement and statute, law, regulation or judicial precedent, the latter shall prevail but in such event the provisions of this Agreement thus affected shall be curtailed and limited only to the extent necessary to bring it within the requirement of the law. In the event that any part, section, paragraph, or clause of this Agreement shall be held by a court of proper jurisdiction to be indefinite, invalid or otherwise unenforceable, the entire Agreement shall not fail on account thereof, but the balance of the Agreement shall continue in full force and effect unless such construction would clearly be contrary to the intentions of the parties. 7. Miscellaneous. ------------- (a) Waivers and Amendments. With the written consent of each of ---------------------- Crane, the Company and the holders of a majority of the Series A Preferred Stock and Series B Preferred Stock, voting together as a single class, this Agreement may be amended and the obligations of Crane under this Agreement may be waived (either generally or in a particular instance, either retroactively or prospectively, and either for a specified period of time or indefinitely). (b) Governing Law. This Agreement shall be executed and entered into ------------- in the State of Delaware and is to be governed by and interpreted under the laws of the that state. 2 (c) Entire Agreement. This Agreement constitutes the entire agreement ---------------- between the parties with respect to the matters referred to herein, and no prior or contemporaneous agreement or understanding shall be effective for any purpose. (d) Heading. The paragraph headings herein have been inserted for ------- convenience only, and are not intended to restrict, construe, or modify in any manner any of the terms and provisions hereof. (e) Counterparts. This Agreement may be executed in any number of ------------ counterparts, each of which shall be an original but all of which together shall constitute. one instrument. (f) Delays or Omissions. It is agreed that no delay or omission to ------------------- exercise any right, power or remedy accruing to any party hereto, upon any breach or default of any other party hereto shall impair such right, power or remedy, nor shall it be construed to be a waiver of any such breach or default, or any acquiescence herein or of or in any similar breach or default thereafter occurring. It is further agreed that any waiver, permit, consent or approval of any kind or character on the part of the party hereto of any breach or default under this Agreement, or any waiver of any provisions or conditions of this Agreement must be in writing and shall be effective only to the extent specifically set forth in such writing and that all remedies, either under this Agreement, or by law or otherwise afforded to such party, shall be cumulative and not alternative. (g) Specific Performance. The parties will be entitled to enforce -------------------- their rights under this Agreement specifically (without posting a bond or other security), to recover damages by reason of any breach of any provision of this agreement and to exercise all other rights existing in their favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and any party may in its sole discretion apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive relief in order to enforce or prevent any violation of the provisions of this Agreement. (h) Dispute Resolution. The parties acknowledge and agree that time ------------------ is of the essence in resolving any dispute that may arise in connection with this Agreement. Except as set forth herein, any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be settled by binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"). The expenses of the arbitration, including the arbitrator's fees, expert witness fees, and attorneys' fees, may be awarded to the prevailing party, in the discretion of the arbitrator, or may be apportioned between the parties in any manner deemed appropriate by the arbitrator. Unless and until the arbitrator decides that one party is to pay for a (or a share) of such expenses, the Company shall pay all reasonable expenses, including legal and accounting fees and costs arising in connection with enforcement of this Agreement or the Collateral Agreements. The parties shall keep confidential the decision of the arbitrator. Notwithstanding the foregoing, the parties may disclose information about such decision to persons who have a need to know, such as directors, trustees, management employees, witnesses, experts, investors, attorneys, lenders, insurers, and others who may be affected. Once the 3 arbitration award has become final, if the arbitration award is not promptly satisfied, then these confidentiality provisions shall no longer be applicable. Notwithstanding the foregoing, any party may seek equitable enforcement of the terms of this Agreement pursuant to Section 7(g) hereof in any court of competent jurisdiction. IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. COMPS INFOSYSTEMS, INC. By: _____________________________________ Christopher A. Crane, President _________________________________________ Christopher A. Crane, in his individual capacity PURCHASERS: SUMMIT VENTURES III, L.P. By: Summit Partners III, L.P. its General Partner By: Stamps, Woodsum & Co. III, its General Partner By: _____________________________________ Gregory M. Avis, General Partner SUMMIT INVESTORS II, L.P. By: _____________________________________ Gregory M. Avis, General Partner 4 EXHIBIT G Restated Certificate of Incorporation See Exhibit 3.1 to Registration Statement on Form S-1 EXHIBIT H Schedule of Contracts EXHIBIT H COMPS INFOSYSTEMS, INC. SCHEDULE OF LEASES, LOANS, CONTRACTS ------------------------------------ As of December 31, 1997 EQUIPMENT LEASES - ---------------- Ford Motor Corp. Acct. No. FN A321 335R Term: 48 months Start: 01/26/94 Vehicle: FORD Escort 1993 Lease payment: $277.30/month Original Loan: $12,305.65 G.E. Capital Lease No. 6519146-001 Term: 60 Months Start: 5/16/94 Equipment: Executone Telephone Equipment Lease Payment: $1,521.89/month Original Loan: $64,805.00 G.E. Capital Lease No. 6519146-002 Term: 48 Months Start: 9/23/97 Equipment: Executone Telephone Equipment Lease Payment: $808.05/month Original Loan: $30,806.45 Avnet/AT&T Capital Corporation Lease No. 424755 Term: 60 months Start: 07/25/94 Equipment: HP 9000 Computer Lease Payment: $744.57/month Original Loan: $32,121.40 Sybase Financial Services, Inc. Agreement # 515973 Term: 36 months Start: 10/21/94 Equipment: Sybase Software Lease Payment: $1,025.39/month Original Loan: $29,255.00 EQUIPMENT LEASES (CON'T) - ------------------------ Canon Financial Service Lease No. 001-0050913-001 Term: 60 months Start: 09/20/94 Equipment: 3 Canon Copiers Lease Payment: $457.18/month Original Loan: $20,628.00 Canon Financial Service Lease No. 001-0058622-001 Term: 60 Months Start: 09/20/94 Equipment: 1 Canon Copier Lease Payment: $130.40/month Original Loan: $7,824.00 Tokai Financial Lease No. 24150393 Term: 60 Months Start: 01/10/95 Equipment: Haworth Systems Furniture Lease Payment: $2,421.22/month Original Loan: $111,576.68 Orix USA Corporation Lease No. 33938 Terms: 36 Months Start: 01/15/95 Equipment: Gupta Software Loan Payment: $2,102.80/month Original Loan: $80,296.96 EQUIPMENT AND WORKING CAPITAL LOANS - ----------------------------------- Venture Lending & Leasing Inc. Loan No. 69-001 Term: 48 months Start: 09/30/96 Type of Loan: Equipment Loan Payment: $21,005.66/month Final Interest Payment: $125,531.83 Original Loan: $836,878.88 Venture Lending & Leasing Inc. Loan No. 69-002 Term: 36 months Start: 09/30/96 Type of Loan: Working Capital Loan Payment: $18,457.50/month Final Interest Payment: $86,250.00 Original Loan: $575,000.00 Venture Lending & Leasing Inc. Loan No. 69-003 Term: 48 months Start: 03/31/97 Type of Loan: Equipment Loan Payment: $8,557.36/month Final Interest Payment: $51,139.59 Original Loan: $340,930.58 Venture Lending & Leasing Inc. Loan No. 69-004 Term: 48 months Start: 11/18/97 Type of loan: Equipment Loan Payment: $2,554.87/month Final Interest Payment: $15,268.12 Original Loan: $101,787.49 Venture Lending & Leasing Inc. Loan No. 69-005 Term: 48 months Start: 12/01/97 Type of Loan: Equipment Loan Payment: $2,594.52/month Final Interest Payment: $15,505.10 Original Loan: $103,367.33 EQUIPMENT AND WORKING CAPITAL LOANS (CON'T) - ------------------------------------------- Venture Lending & Leasing Inc. Loan No. 69 006 Term: 48 months Start: 12/11/97 Type of Loan: Equipment Loan Payment: $2,930.63/month Final Interest Payment: $17,513.72 Original Loan: $116,758.10 Venture Lending & Leasing Inc. Loan No. 69-007 Term: 36 months Start: 12/11/97 Type of Loan: Working Capital Loan Payment: $2,672.06/month Final Interest Payment: $ 12,486.29 Original Loan: $ 83,241.90 NOTES PAYABLE - ------------- Experian RES Total Note Payable Amount: $750,000.00 Amount Due as of 12/31/97: $655,800.00 Payment Schedule: Date Due Amount -------- ------ 12/31/99 $405,800.00 12/31/00 $125,000.00 (plus accrued interest) 12/31/01 $125,000.00 (plus accrued interest) OFFICE LEASES - ------------- Lessor: Mutual Benefit Life Insurance Co. c/o Vestar Property Management Lease Address: 5060 N. 40th Street, #106 Phoenix, AZ 85018 Start: 11/15/93 Term: 48 months Effective Rent: $2,116.44/month Lessor: Hugh W. Klebahn as Trustee for the Jane K. Molyneux Trust c/o Hanford, Freund & Company Lease Address: 870 Mitten Road Burlingame, CA 94010 Start: 05/05/95 Term: 60 months Effective Rent: $2,966.56/month Lessor: COMPS Plaza Associates, Ltd. c/o McKellar Properties Lease Address: 9888 Carroll Centre Road San Diego, CA 92126 Start: 07/01/94 Term: 96 months Effective Rent/Month: $20,508.86/month Lessor: 8500 CDC L.P. Lease Address: 8500 Leesburg Pike, Suite 7700 Vienna, VA 22182 Start: 3/01/95 Term: 60 months Effective Rent/Month: $2,735.16/month CONTRACTS - --------- DataQuick Information Systems 9171 Town Centre Drive, Suite 600 San Diego, CA 92122 Don Cohn, President Insurance Services Office, Inc. (ISO) 7 World Trade Center New York, NY 10048 Carole Banfield, Senior Vice President CONTRACTS (CON'T) - ----------------- Qualitative Marketing Software, Inc. 28051 U.S. Highway 19 North, Suite E Clearwater. FL 34621-2647 Paul Wray, President BLR Data 1820 E. River Road, Suite 110 Tucson, AZ 85718 Paul M. Evans, VP of Sales Venture Lending & Leasing Inc. 2010 North First Street, Suite 310 San Jose, CA 95131 Salvador O. Gutierrez, President Experian RES 5601 East La Palma Avenue Anaheim, CA 92807 George Livermoore, General Manager BANKING RELATIONSHIPS - --------------------- Bank: Silicon Valley Bank 5414 Oberline Drive, Suite 230 San Diego, CA 92121 Jeffrey M. Huhn, Vice President (619) 558-3812 Bank: Union Bank 7807 Girard Avenue La Jolla, CA 93037 Greg Farnsworth, Vice President (619) 230-4760 EXHIBIT H --------- Agreements with Officers, Directors, Stockholders, Consultants, Employees 1. Employment Agreements with each of the following: a. Chris Crane b. Karen Goodrum c. Craig Farrington d. Chris Fenton e. Walter Papciak 2. Confidentiality and Proprietary Information Agreements with all employees, except those employees listed on Exhibit 3.8 to Exhibit C to Purchase Agreement. Please see Exhibit 3.8 to Exhibit C. 3. Indemnification Agreements with all Directors and the following officers: a. Chris Crane b. Karen Goodrum c. Craig Farrington d. Chris Fenton e. Robert Beasley e. Walter Papciak 4 EXHIBIT I Form of Opinion of Counsel [LATHAM & WATKINS LETTERHEAD] February 9, 1998 Summit Ventures III, L.P. Summit investors II, L.P. 409 Hamilton Avenue, Suite 200 Palo Alto, California 94301 Re: COMPS InfoSystems. Inc.: 554,600 Shares of Series B Preferred Stock ------------------------------------------------------------------- and 298,631 Warrants to Purchase Shares of Class B Common Stock issued ---------------------------------------------------------------------- to Summit --------- Ladies and Gentlemen: We have acted as counsel to COMPS InfoSystems, Inc., a Delaware corporation (the "Company"), in connection with the sale to Summit Ventures III, L.P. and Summit Investors II, L.P. (together, "Summit") on the date hereof by the Company of an aggregate of 554,600 shares (the "Summit Shares") of Series B Preferred Stock of the Company, par value $.01 per share (the "Series B Preferred Stock"), and warrants (the "Summit Warrants") to purchase 298,631 shares of the Class B Common Stock of the Company, par value $.01 per share (the "Class B Common Stock"), pursuant to that certain Stock and Warrant Purchase Agreement dated as of February 6, 1998 (the "Agreement")' among Summit, Christopher A. Crane ("Crane"), Merrill Oster ("Oster") and the Company. Pursuant to the Agreement, (i) the Company will sell to Crane on the date hereof 69,325 shares (the "Crane Shares") of Series B Preferred Stock, and warrants (the "Crane Warrants") to purchase 37,329 shares of the Class A Common Stock of the Company, par value $.0l per share (the "Class A Common Stock"), and (ii) the Company will sell to Oster on the date hereof 13,865 shares (the "Oster Shares") of Series B Preferred Stock, and warrants (the "Oster Warrants") to purchase 7,466 shares of the Class B Common Stock (the Summit Shares, the Crane Shares and the Oster Shares being collectively referred to as the "Shares", and the Summit Warrants, the Crane Warrants and the Oster Warrants being collectively referred to as the "Warrants"). This opinion is being rendered to you pursuant to Section 5.1(h) of the Agreement. Capitalized terms used herein and not otherwise defined herein shall have the meanings given them in the Agreement. As such counsel, we have made such legal and factual examinations and inquiries as we have deemed necessary or appropriate for purposes of this opinion, except where a statement is qualified as to knowledge or awareness, in which case we have made no or limited inquiry as specified below. We have examined, among other things, the following: (a) The Agreement; 1 (b) The Amended and Restated Voting Agreement between Summit, Crane and the Company, the Summit Warrants between Summit and the Company, the Amended and Restated Right of First Refusal and Co-Sale Agreement between Summit, Crane and the Company, and the Amended and Restated Investors Rights Agreement between Summit, Crane, Oster and the Company, the Crane Warrant between the Company and Crane, and the Oster Warrant between the Company and Oster, each dated February 6, 1998; (c) The notes, loan agreements, mortgages, deeds of mm, security agreements and other written agreements and instruments creating, evidencing or securing indebtedness of the Company for borrowed money, identified to us by an officer of the Company as material to the Company, and the other agreements listed on Exhibit H to the Agreement (the "Material Agreements"); (d) The Restated Certificate of Incorporation (the "Restated Certificate") and Bylaws of the Company (together, the "Governing Documents"); (e) Court and administrative orders, writs, judgments, injunctions and decrees specifically directed to the Company and identified to us by an officer of the Company as material to the Company (the "Court Orders"); (f) Records of the Company with respect to the issuance and transfer of capital stock and options; (g) Minutes of the meetings of the Board of Directors and stockholders of the Company and various written consents provided to us by the officers of the Company; (h) A certificate of good standing for the Company from the Secretary of State of Delaware, (i) A certificate of good standing for the Company from the Secretary of State of California; and (j) Certificates from certain of the Company's officers as of the date hereof The documents described in subsections (a) - (b) above are referred to herein collectively as the "Documents." In such examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, and the conformity to authentic original documents of all documents submitted to us as copies. In rendering this opinion, we have relied on and assumed the correctness and completeness of certificates of government officials and reports of professional filing service companies. As to questions of fact, we have been furnished with, and with your consent have exclusively relied upon, certificates of officers and representatives of the Company. In addition, we assumed that the representations and warranties of Summit set forth in the Documents are true and correct as of the date hereof, including without limitation the representation that each Purchaser is an 2 "accredited investor" as defined under Regulation D pursuant to the Securities Act of 1933, as amended (the "Act"). To the extent that the obligations of the Company may be dependent upon such matters, we assume for purposes of this opinion that: all parties to the Documents other than the Company have complied with any applicable requirement to file returns and pay taxes under the Franchise Tax Law of the State of California; all parties to the Documents other than the Company are duly organized, validly existing and in good standing under the laws of their respective jurisdictions of organization; all parties to the Documents other than the Company have the requisite power and authority to execute and deliver the Documents and to perform their respective obligations under the Documents to which they are a party; and the Documents to which such parties other than the Company are a party have been duly authorized, executed and delivered by such parties and constitute their legally valid and binding obligations, enforceable against them in accordance with their terms. We express no opinion as to compliance by all parties to the Documents other than the Company with any state or federal laws or regulations applicable to the subject transactions because of the nature of their business. Where statements in our opinion are qualified by the term "material," those statements involve judgments and opinions as to the materiality or lack of materiality of any matter to the Company or its business, prospects, assets or financial condition, which are entirely those of the Company and its officers, after having been advised by us as to the legal effect of such matters; however, such opinions and judgments are not known by us to be incorrect. Whenever a statement herein is qualified by "to the best of our knowledge" or a similar phrase, it is intended to indicate that those attorneys in this firm who have rendered legal services in connection with the sale of the Shares and the Warrants do not have current actual knowledge of the inaccuracy of such statement. However, except as otherwise expressly indicated, we have not undertaken any independent investigation to determine the accuracy of any such statement, and no inference that we have any knowledge of any matters pertaining to such statement should be drawn from our representation of the Company. The opinions hereinafter expressed below are subject to the following qualifications: (a) Our opinion is qualified and no opinion is given to the extent that the enforceability of any agreement entered into by the Company, including the Documents, may be limited by, or such agreements and the transactions contemplated thereby may be subject to or affected by, the effect of general principles of equity, including without limitation, concepts of materiality, reasonableness, good faith and fair dealing and the possible unavailability of specific performance or injunctive relief (regardless of whether considered in a proceeding in equity or at law), or that may otherwise contravene public policy; (b) Our opinion is qualified and no opinion is given to the extent that the enforceability of any agreement entered into by the Company, including the Documents, may be limited by, or such agreements and the transactions contemplated thereby may be subject to or affected by: (i) the effect of bankruptcy, reorganization, insolvency, liquidation, readjustment of debt, arrangement, moratorium or other similar laws now or hereinafter in effect relating to or 3 affecting the rights of creditors or (ii) any other laws or statutes which modify, affect or invalidate any remedial, contribution or indemnification provisions set forth in such agreements; (c) We express no opinion with respect to the enforceability of Section II(F) of the Amended and Restated Investors Rights Agreement; (d) Our opinion is qualified and no opinion is given to the extent that certain rights, remedies and waivers contained in the Documents may be limited or rendered ineffective by applicable California laws or judicial decisions governing such provisions, but such laws or judicial decisions do not render the Documents invalid or unenforceable as a whole; (e) We express no opinion as to the Company's compliance with the securities laws, rules and regulations of any state other than California, or with the antifraud provisions of state (including California) and federal laws, rules and regulations concerning the issuance of securities; (f) We express no opinion as to the enforceability of any of the agreements (other than the Documents) attached as exhibits to the Agreement; (g) We are opining herein as to the effect on the subject transaction only of the federal laws of the United States, the internal laws of the State of California and the General Corporation Law of the State of Delaware (the "DGCL"), and we express no opinion with respect to the applicability thereto, or the effect thereon, of the laws of any other jurisdiction or in the case of Delaware, any other laws, or as to any matters of municipal law or the laws of any other local agency within any state; (h) Our opinion is limited by the effect of and subject to any disclosures or exceptions contained in or referred to in the Documents, including, without limitation, those contained in the Officer's Certificate delivered by the Company at the Closing pursuant to the Agreement; (i) We express no opinion as to matters concerning intellectual property, (including, without limitation, patents, trademarks, maskworks, trade secrets and copyrights), real estate or employment matters; (j) We have assumed that there are no agreements, contracts, understandings or negotiations among the parties to any agreement as to which we are required to opine, that would modify the terms of such agreements or the respective rights or obligations of the parties thereunder; (k) We express no opinion as to compliance with the antitrust provisions of federal or state statutory or common law; (1) With respect to our opinion in paragraph 1, we have relied solely upon certificates (or the verbal acknowledgement) of the Secretary of State of Delaware to the effect that the Company is duly incorporated and in good standing under the laws of the Delaware. Based upon and subject to the foregoing, it is our opinion that, as of the date hereof: 4 1. The Company has been duly incorporated and is validly existing and in good standing under the laws of the State of Delaware with corporate power and authority to own its properties and to conduct its business. Based solely on certificates from public officials, we confirm that the Company is qualified to do business in California. 2. To our knowledge, the Company does not control, directly or indirectly, any other corporation, partnership, joint venture or business entity. 3. The Company has the corporate power to execute and deliver the Documents and to consummate the transactions contemplated thereby. The execution and delivery by the Company of the Documents and the consummation of the transactions contemplated thereby have been duly authorized by all necessary corporate action on the part of the Company, including all necessary corporate action on the part of the Company, including all necessary stockholder approvals. Each of the Documents has been duly executed and delivered by the Company, and constitutes a legally valid and binding obligation of the Company, enforceable against the Company in accordance with its terms. 4. The authorized capital stock of the Company is 25,000,000 shares of Common Stock, par value $.0l per share (the "Common Stock") and 5,000,000 shares of Preferred Stock, par value $.01 per share (the "Preferred Stock"). The first series of Common Stock is comprised of 22,500,000 shares designated "Class A Common Stock". The second series of Common Stock is comprised of 2,500,000 shares designated "Class B Common Stock". The first series of Preferred Stock is comprised of 4,270,336 shares designated "Series A Preferred Stock." The second series of Preferred Stock is comprised of 637,790 shares designated "Series B Preferred Stock." Immediately prior to the Closing (but after the filing of the Restated Certificate), there were issued and outstanding 4,773,860 shares of Class A Common Stock, no shares of Class B Common Stock, 4,270,336 shares of Series A Preferred Stock and no shares of Series B Preferred Stock. The rights of each series and class of the Company's stock are as set forth in the Restated Certificate. All issued and outstanding shares of Class A Common Stock and Series A Preferred Stock have been duly authorized and validly issued, are fully paid and nonassessable and, to our knowledge, are free of any preemptive rights contained in the Governing Documents of the Company. The issuance of the outstanding shares of Class A Common Stock and Series A Preferred Stock did not, to our knowledge, require any consents, approvals, authorizations, registrations or filings by the Company under any Federal or California statute, rule or regulation applicable to the Company, or under any provision of the DGCL applicable to the Company, except such as have been or will be obtained or made. To our knowledge, except for (i) the rights, preferences and privileges of the Common Stock and the Preferred Stock as set forth in the Restated Certificate, a certified copy of which is being provided to you at the Closing, (ii) the rights set forth in the Agreement and the exhibits thereto, (iii) the shares of Class A Common Stock issuable upon exercise of outstanding warrants issued to Crane and (iv) the shares of Class B Common Stock issuable upon the exercise of outstanding (x) stock options under the Company's Stock Option Plan, (y) warrants issued to Summit and Venture Lending and Leasing, Inc., and (z) warrants issued to Oster, there are no outstanding rights, options, warrants, conversion rights or agreements for the purchase or acquisition from the Company of any shares of its capital stock. 5 5. The Class A Common Stock issuable (i) upon conversion of (a) the Shares, and (b) the Class B Common Stock (including the Class B Common Stock issuable upon exercise of the Summit Warrants, the Oster Warrants, and the Venture Lending and Leasing, Inc. Warrant) and (ii) upon exercise of the Crane Warrants, has been duly and validly reserved. The Class B Common Stock issuable upon exercise of the Summit Warrants, the Oster Warrants and the Venture Lending and Leasing Warrant has been duly and validly reserved. The (i) Shares, (ii) Class A Common Stock issuable upon conversion of the Shares, upon exercise of the Crane Warrant, and upon conversion of the Class B Common Stock, and (iii) Class B Common Stock issuable upon exercise of the Summit Warrants, the Oster Warrants, and the Venture Lending and Leasing Warrant, when issued in compliance with the provisions of the Company's Restated Certificate and the provisions of the applicable warrant agreements, will be validly issued, fully paid and nonassessable. To our knowledge, (i) upon the issuance and delivery by the Company of the Summit Shares and payment by Summit therefor in accordance with the terms of the Agreement, Summit will acquire such Summit Shares free of any lien, encumbrance or restriction on transfer (except for any transfer restrictions arising under federal or state securities laws, any lien, encumbrance or transfer restrictions created by Summit or any restrictions contained in the Documents) and (ii) upon the issuance and delivery by the Company of the Summit Warrants and payment by Summit therefor in accordance with the terms of the Agreement, Summit will acquire such warrants free of any lien, encumbrance or restriction on transfer (except for any transfer restrictions arising under federal or state securities laws or any lien, encumbrance or transfer restrictions created by Summit). To our knowledge, except as set forth in the Agreement and the exhibits thereto, no person has any preemptive rights or any right of first refusal in connection with the issuance of the Summit Shares or any future issuances of securities by the Company other than those held by the Purchasers. 6. The execution and delivery of the Documents do not: (i) to our knowledge, violate any federal or California statute, rule or regulation applicable to the Company, or any provision of the DGCL applicable to the Company, (ii) violate the provisions of the Governing Documents of the Company or, (iii) to our knowledge, conflict with or constitute a material default under the Material Agreements or the Court Orders. 7. The execution and delivery of the Documents and the issuance and sale of the Summit Shares and the Series B Summit Warrants do not, to our knowledge, require any consents, approvals, authorizations, registrations, declarations or filings by the Company under any federal or California statute, rule or regulation applicable to the Company, or under any provision of the DGCL applicable to the Company, except such as have been or will be obtained or made. 8. To our knowledge, except as set forth in the Agreement or the exhibits thereto, there are no actions, proceedings or investigations pending against the Company, nor has the Company received any threat thereof, which questions the validity of the Documents or the right of the Company to enter into the Documents that, if adversely decided, would have a material adverse effect upon the business or financial condition of the Company taken as a whole. 9. The offer, sale and issuance pursuant to the terms of the Agreement of the Summit Shares and the Summit Warrants are exempt (i) from the registration 6 requirements of Section 5 of the Act, and (ii) from the qualification requirements of the Corporate Securities Law of the State of California (the "California Securities Law") pursuant to Section 25102(f) of the California Securities Law; and, under the Act and the California Securities Law as they presently exist, the issuance of the Class A Common Stock upon conversion of the Summit Shares and upon conversion of the Class B Common Stock, and the issuance of the Class B Common Stock upon exercise of the Summit Warrants and the Venture Lending and Leasing Warrant, when issued in conformity with the terms of the Restated Certificate, will be exempt from such registration and qualification requirements. This opinion is rendered only to you and is solely for your benefit in connection with the transactions covered hereby. This opinion may not be relied upon by you for any other purpose, or furnished to, quoted to or relied upon by any other person, firm or corporation for any purpose, without our prior written consent. Very truly yours, 7 EX-10.4 9 FORM OF CLASS B COMMON STOCK WARRANT DATED 10/14/94 Exhibit 10.4 THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT OR (ii) IN COMPLIANCE WITH RULE 144, OR (iii) PURSUANT TO AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION. Warrant No. W-[ ] FORM OF CLASS B COMMON STOCK WARRANT OF COMPS INFOSYSTEMS, INC. ----------------------- THIS CERTIFIES THAT, for value received, __________________ (the "Holder") is entitled to subscribe for and to purchase from COMPS INFOSYSTEMS INC., a Delaware corporation (the "Company"), ___________ shares of the non- voting Class B Common Stock of the Company, at the price per share set forth in Section 1 hereof, payable in cash or check (such price being referred to herein as the "Exercise Price" and subject to adjustment as set forth Section 2 below), at any time or from time to time following the occurrence of any of the events described in Section 3 hereof and during the term as set forth below. 1. Exercise Price. The Exercise Price shall be $.01 per share. -------------- 2. Adjustments for Subdivisions, Dividends, Combinations or -------------------------------------------------------- Consolidation of Common Stock. - ----------------------------- a. Subdivisions, Dividends, Consolidations. In the event (i) the --------------------------------------- outstanding shares of the Class B Common Stock shall be increased (by stock split, stock dividend or otherwise), into a greater number of shares of Class B Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such increase, be proportionately decreased; and (ii) the outstanding shares of Class B Common Stock shall be decreased, by reclassification or otherwise, into a lesser number of shares of Class B Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such decrease, be proportionately increased. In the event that the Exercise Price is adjusted pursuant to this Subsection, the number of shares of Class B Common Stock issuable pursuant to this Warrant shall be increased or decreased to a number determined by multiplying (1) the number of shares of Class B Common Stock issuable pursuant to this Warrant immediately prior to the adjustment by (2) a fraction, the numerator of which shall equal the Exercise Price in effect immediately -1- prior to the adjustment and the denominator of which shall equal the Exercise Price in effect immediately after the adjustment. b. Reclassification, Reorganization and Consolidation. In case of -------------------------------------------------- any reclassification, capital reorganization or change in the Class B Common Stock of the Company (other than as a result of a subdivision, combination or stock dividend provided for in Section 2(a) above), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the holder of this Warrant, so that the holder of this Warrant shall have the right, commencing upon the times set forth in Section 3, and prior to the expiration of this Warrant, to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization or change by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such reclassification, reorganization or change. In any such, case appropriate provisions shall be made with respect to the rights and interests of the holder of this Warrant so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per share payable hereunder, provided the aggregate purchase price shall remain the same. c. Conversion of Class B Common Stock. If at any time prior to the ---------------------------------- expiration of this Warrant, all of the Company's then outstanding Class B Common Stock is converted into shares of the Company's Class A Common Stock, then this Warrant shall immediately become exercisable for that number of shares of Class A Common Stock receivable upon conversion by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such conversion, and the Exercise Price shall be immediately adjusted to equal the quotient obtained by dividing (x) the aggregate Exercise Price of the maximum number of shares of Class B Common Stock for which this Warrant was exercisable immediately prior to such conversion, by (y) the number of shares of Class A Common Stock for which this Warrant is exercisable immediately after such conversion. After any such conversion, all references herein to Class B Common Stock shall be deemed to be references to Common Stock. d. Notice of Adjustment. When any adjustment is required to be made -------------------- in the number or kind of shares purchasable upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the number of shares of Common Stock or other securities or property thereafter purchasable upon exercise of the Warrant. 3. Exercise of Warrant. This Warrant may be exercised in whole or in ------------------- part, commencing (i) one day prior to the earlier of the closing or the effective time of a "Liquidity Event," as defined herein; or, (ii) if earlier, October 14, 2001, by the surrender of this Warrant and payment to the Company by cash or check of the Exercise Price for all of the Shares purchased. The Company shall, within ten (10) days after such delivery, (a) prepare and issue a certificate for the Shares purchased in the name of the Holder of this Warrant, or as such Holder may direct (subject to the restrictions upon transfer contained herein and upon payment by such -2- Holder hereof of any applicable transfer taxes) and (b) prepare and issue a new warrant of like terms if this Warrant is exercised for less than all of the Shares subject hereto. "Liquidity Event" shall mean (i) an acquisition, consolidation or merger of the Company with or into any other corporation or corporations unless the stockholders of the Company prior to such transaction directly or indirectly own more than fifty percent (50%) of the voting stock of the surviving or accruing corporation or corporations; (ii) the sale, transfer or other disposition of all or substantially all of the assets of the Company to a person other than a corporation or partnership controlled by the Company or its stockholders; (iii) the effectuation by the Company of a transaction or series of related transactions in which more than fifty percent (50%) of the outstanding voting power of the Company prior to such transaction or series of related transactions, is disposed of; and (iv) the closing of the sale of the Company's securities pursuant to an underwritten public offering. a. Net Issue Exercise. Notwithstanding any provisions herein to the ------------------ contrary, in lieu of exercising this Warrant for cash, the Holder may elect to receive shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company together with a properly endorsed notice of exercise and notice of such election in which event the Company shall issue to the Holder a number of shares of Clm B Common Stock computed using the following formula: X = Y (A - B) --------- A Where X = the number of shares of Class B Common Stock to be issued to the Holder, Y = the number of shares of Class B Common Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being canceled (at the date of such calculation), A = the fair market value of one share of the Company's Class A Common Stock (at the date of such calculation), and B = the Exercise Price (as adjusted to the date of such calculation). For purposes of the above calculation, fair market value of one share of Class A Common Stock shall be determined by the Company's Board of Directors in good faith; provided, however, that where there exists a public market for the Company's Class A Common Stock at the time of such exercise, fair market value shall mean the average over the preceding twenty (20) trading days (or such fewer number of days as such public market has existed) of the mean of the high closing bid and asked prices on the over-the-counter market as reported by Nasdaq, or if then traded on a national securities exchange or the Nasdaq National Market, the average over the preceding twenty (20) trading days (or such fewer number of days as the Class A Common Stock has been so traded) of the mean of the high and low prices on the principal national securities exchange or the National Market on which it is so traded. Notwithstanding the foregoing, in the event the Warrant is exercised in connection with the Company's initial -3- public offering of Common Stock, the fair market value per share shall be the per share offering price to the public of the Company's initial public offering. 4. Term of Warrant. This Warrant expires and shall no longer be --------------- exercisable as of 11:59 p.m. Pacific standard time, October 14, 2004, and shall be void thereafter. 5. Conditions to Exercise of Warrant or Transfer of the Shares. It ----------------------------------------------------------- shall be a condition to any exercise of this Warrant that the Company shall have received, at the time Shares being issued upon such exercise of such exercise, a representation in writing that the are being acquired for investment and not with a view to any sale or distribution thereof, or a statement of the pertinent facts covering any proposed distribution thereof. It shall be a condition to any transfer of any or all of the Shares issued upon exercise of this Warrant, other than a transfer registered under the Securities Act of 1933, as amended (the "Act"), that the Company shall have received a legal opinion, in form and substance reasonably satisfactory to the Company and its counsel, reciting the pertinent circumstances surrounding the proposed transfer and stating that such transfer is exempt from the prospectus and the registration requirement of the Act Each certificate evidencing the Shares issued upon exercise of this Warrant, or upon any transfer of such shares (other than a transfer registered under the Act or any subsequent transfer of shares so registered) shall, at the option of the Company, contains a legend, in form and substance satisfactory to the Company and its counsel, restricting the transfer of such shares to sales or other dispositions exempt from the requirements of the Act. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144, other than opinions with regard to sales under Rule 144(k). 6. Fractional Shares. This Warrant shall in no event be exercisable ----------------- for fractional shares, and in lieu thereof, the number of shares which would otherwise be purchased under this Warrant shall be rounded up to the nearest whole share of Common Stock. 7. Miscellaneous. ------------- a. The Company covenants that it will at all times reserve and keep available, solely for the purpose of issuance upon the exercise hereof, a sufficient number of shares of Class A or Class B Common Stock, as applicable, to permit the exercise hereof in full. Such shares when issued in compliance with the provisions of this Warrant and the Certificate of Incorporation, as amended, will be duly authorized, validly issued, fully paid and nonassessable. b. The terms of this Warrant shall be binding upon and shall inure to the benefit of any successors or assigns of the Holder hereof and of the Shares issued or issuable upon the exercise hereto. c. The Holder, as such, shall not be entitled to vote or receive dividends or be deemed to be a shareholder of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, is such, any rights of a shareholder of the Company or any right to vote, give or withhold consent to any corporate action, receive notice of meetings, receive dividends or subscription rights, or otherwise. d. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to the foregoing terms and conditions. -4- e. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction, upon delivery of an indemnity agreement reasonably satisfactory in form valid amount to the Company or, in the case of any such mutilation, upon surrender and cancellation of such Warrant, the Company at its expense will execute and deliver, in lieu thereof, a new Warrant of like date and tenor. f. This Warrant shall be governed by the internal laws of the State of California. IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized officer. Dated: October 14, 1994 COMPS INFOSYSTEMS, INC. By: -------------------------- Christopher A. Crane President -5- Schedule of Warrant Holders --------------------------- Name Number of Warrants ---- ------------------ Summit Ventures III, L.P. 372,272 Summit Ventures II, L.P. 7,597 EX-10.5 10 CLASS A COMMON STOCK WARRANT DATED 2/9/98 Exhibit 10.5 THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT OR (ii) IN COMPLIANCE WITH RULE 144, OR (iii) PURSUANT TO AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION. Warrant No. W-A1 CLASS A COMMON STOCK WARRANT OF COMPS INFOSYSTEMS, INC. ----------------------- THIS CERTIFIES THAT, for value received, Christopher A. Crane (the "Holder") is entitled to subscribe for and to purchase from COMPS INFOSYSTEMS INC., a Delaware corporation (the "Company"), 37,329 shares of the voting Class A Common Stock of the Company, at the price per share set forth in Section 1 hereof payable in cash or check (such price being referred to herein as the "Exercise Price" and subject to adjustment as set forth Section 2 below), at any time or from time to time following the date hereof and during the term as set forth below. 1. Exercise Price. The Exercise Price shall be $.01 per share. -------------- 2. Adjustments for Subdivisions, Dividends, Combinations or Consolidation ---------------------------------------------------------------------- of Common Stock. - --------------- a. Subdivisions, Dividends, Consolidations. In the event (i) the --------------------------------------- outstanding shares of the Class A Common Stock shall be increased (by stock split, stock dividend or otherwise), into a greater number of shares of Class A Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such increase, be proportionately decreased, and (ii) the outstanding shares of Class A Common Stock shall be decreased, by reclassification or otherwise, into a lesser number of shares of Class A Common Stock, the Exercise Price then in effect shall concurrently with the effectiveness of such decrease, be proportionately increased. In the event that the Exercise Price is adjusted pursuant to this Subsection, the number of shares of Class A Common Stock issuable pursuant to this Warrant shall be increased or decreased to a number determined by multiplying (1) the number of shares of Class A Common Stock issuable pursuant to this Warrant immediately prior to the adjustment by (2) a fraction, the numerator of which shall equal the Exercise Price in effect immediately prior to the adjustment and the denominator of which shall equal the Exercise Price in effect immediately after the adjustment. b. Reclassification. Reorganization and Consolidation. In case of -------------------------------------------------- any reclassification, capital reorganization or change in the Class A Common Stock of the Company (other than as a result of a subdivision, combination or stock dividend provided for in Section 2(a) above), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the holder of this Warrant, so that the holder of this Warrant shall have the right, prior to the expiration of this Warrant, to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization or change by a holder of the same number of shares of Class A Common Stock as were subject to this Warrant immediately prior to such reclassification, reorganization or change. In any such case appropriate provisions shall be made with respect to the rights and interests of the holder of this Warrant so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per share payable hereunder, provided the aggregate purchase price shall remain the same. c. Notice of Adjustment. When any adjustment is required to be made -------------------- in the number or kind of shares purchasable upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the number of shares of Common Stock or other securities or property thereafter purchasable upon exercise of the Warrant. 3 Exercise of Warrant. The Holder may exercise this Warrant in whole or ------------------- in part by its surrender to the Company and payment to the Company by cash or check of the Exercise Price for all of the Shares purchased. The Company, shall within ten (10) days after such delivery, (a) prepare and issue a certificate for the Shares purchased in the name of the Holder of this Warrant, or as such Holder may direct (subject to the restrictions upon transfer contained herein and upon payment by such Holder hereof of any applicable transfer taxes) and (b) prepare and issue a new warrant of like terms if this Warrant is exercised for less than all of the Shares subject hereto. a. Net Issue Exercise. Notwithstanding any provisions herein to the ------------------ contrary, in lieu of exercising this Warrant for cash, the Holder may elect to receive shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company together with a property endorsed notice of exercise and notice of such election in which event the Company shall issue to the Holder a number of shares of Class A Common Stock computed using the following formula: Y(A-B) ------ X = A Where X = the number of shares of Class A Common Stock to be issued to the Holder, Y = the number of shares of Class A Common Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being canceled (at the date of such calculation), A = the fair market value of one share of the Company's Class A Common Stock (at the date of such calculation), and 2 B = the Exercise Price (as adjusted to the date of such calculation). For purposes of the above calculation, fair market value of one share of Class A Common Stock shall be determined by the Company's Board of Directors in good faith; provided, however. that where there exists a public market for the Company's Class A Common Stock at the time of such exercise, fair market value shall mean the average over the preceding twenty (20) trading days (or such fewer number of days as such public market has existed) of the mean of the high closing bid and asked prices on the over-the-counter market as reported by Nasdaq, or if then traded on a national securities exchange or the Nasdaq National Market, the average over the preceding twenty (20) trading days (or such fewer number of days as the Class A Common Stock has been so traded) of the mean of the high and low prices on the principal national securities exchange or the National Market on which it is so traded. Notwithstanding the foregoing, in the event the Warrant is exercised in connection with the Company's initial public offering of Common Stock, the fair market value per share shall be the per share offering price to the public of the Company's initial public offering. 4. Term of Warrant. This Warrant expires and shall no longer be --------------- exercisable as of 11:59 p.m. Pacific standard time, February 6, 2008, and shall be void thereafter. 5. Conditions to Exercise of Warrant or Transfer of the Shares. It shall ----------------------------------------------------------- be a condition to any exercise of this Warrant that the Company shall have received, at the time of such exercise, a representation in writing that the Shares being issued upon such exercise are being acquired for investment and not with a view to any sale or distribution thereof, or a statement of the pertinent facts covering any proposed distribution thereof. It shall be a condition to any transfer of any or all of the Shares issued upon exercise of this Warrant, other than a transfer registered under the Securities Act of 1933, as amended (the "Act"), that the Company shall have received a legal opinion, in form and substance reasonably satisfactory to the Company and its counsel, reciting the pertinent circumstances surrounding the proposed transfer and stating that such transfer is exempt from the prospectus and the registration requirement of the Act. Each certificate evidencing the Shares issued upon exercise of this Wan- ant, or upon any transfer of such shares (other than a transfer registered under the Act or any subsequent transfer of shares so registered) shall, at the option of the Company, contain a legend, in form and substance satisfactory to the Company and its counsel, restricting the transfer of such shares to sales or other dispositions exempt from the requirements of the Act. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144, other than opinions with regard to sales under Rule 144(k). 6. Fractional Shares. This Warrant shall in no event be exercisable for ----------------- fractional shares, and in lieu thereof, the number of shares which would otherwise be purchased under this Warrant shall be rounded up to the nearest whole share of Common Stock. 7. Miscellaneous. ------------- a. The Company covenants that it will at all times reserve and keep available, solely for the purpose of issuance upon the exercise hereof, a sufficient number of shares of Class A Common Stock to permit the exercise hereof in full. Such shares when issued 3 in compliance with the provisions of this Warrant and the Certificate of Incorporation, as amended, will be duly authorized, validly issued, fully paid and nonassessable. b. The terms of this Warrant shall be binding upon and shall inure to the benefit of any successors or assigns of the Holder hereof and of the Shares issued or issuable upon the exercise hereto. c. The Holder, as such, shall not be entitled to vote or receive dividends or be deemed to be a shareholder of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, as such, any rights of a shareholder of the Company or any right to vote, give or withhold consent to any corporate action, receive notice of meetings, receive dividends or subscription rights, or otherwise. d. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to the foregoing terms and conditions. e. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction, upon delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation, upon surrender and cancellation of such Warrant, the Company at its expense will execute and deliver, in lieu thereof a new Warrant of like date and tenor. f. This Warrant shall be governed by the internal laws of the State of California. IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized officer. Dated: February 9, 1998 COMPS INFOSYSTEMS, INC. By: /s/ Robert C. Beasley ------------------------ Robert C. Beasley Secretary 4 EX-10.6 11 FORM OF CLASS B COMMON STOCK WARRANT DATED 2/9/98 Exhibit 10.6 THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT OR (ii) IN COMPLIANCE WITH RULE 144; OR (iii) PURSUANT TO AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION. Warrant No. W-[_] FORM OF CLASS B COMMON STOCK WARRANT OF COMPS INFOSYSTEMS, INC. ----------------------- THIS CERTIFIES THAT, for value received, _____________________ (the "Holder") is entitled to subscribe for and to purchase from COMPS INFOSYSTEMS, INC., a Delaware corporation (the "Company"), ________ shares of the non-voting Class B Common Stock of the Company, at the price per share set forth in Section 1 hereof, payable in cash or check (such price being referred to herein as the "Exercise Price" and subject to adjustment as set forth Section 2 below), at any time or from time to time following the occurrence of any of the events described in Section 3 hereof and during the term as set forth below. 1. Exercise Price. The Exercise Price shall be $.01 per share. -------------- 2. Adjustments for Subdivisions, Dividends, Combinations or Consolidation ---------------------------------------------------------------------- of Common Stock. - --------------- a. Subdivisions, Dividends. Consolidations. In the event (i) the --------------------------------------- outstanding shares of the Class B Common Stock shall be increased (by stock split, stock dividend or otherwise), into a greater number of shares of Class B Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such increase, be proportionately decreased; and (ii) the outstanding shares of Class B Common Stock shall be decreased, by reclassification or otherwise, into a lesser number of shares of Class B Common Stock, the Exercise Price then in effect shall, concurrently with the effectiveness of such decrease, be proportionately increased. In the event that the Exercise Price is adjusted pursuant to this Subsection, the number of shares of Class B Common Stock issuable pursuant to this Warrant shall be increased or decreased to a number determined by multiplying (1) the number of shares of Class B Common Stock issuable pursuant to this Warrant immediately prior to the adjustment by (2) a fraction, the numerator of which shall equal the Exercise Price in effect immediately prior to the adjustment and the denominator of which shall equal the Exercise Price in effect immediately after the adjustment. b. Reclassification, Reorganization and Consolidation In case of any -------------------------------------------------- reclassification, capital reorganization or change in the Class B Common Stock of the Company (other than as a result of a subdivision, combination or stock dividend provided for in Section 1 2(a) above), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the holder of this Warrant, so that the holder of this Warrant shall have the right, commencing upon the times set forth in Section 3, and prior to the expiration of this Warrant, to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities and property receivable in connection with such reclassification, reorganization or change by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such reclassification. reorganization or change. In any such case appropriate provisions shall be made with respect to the rights and interests of the holder of this Warrant so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities and property deliverable upon exercise hereof, and appropriate adjustments shall be made to the purchase price per share payable hereunder, provided the aggregate purchase price shall remain the same. c. Conversion of Class B Common Stock. If at any time prior to the ---------------------------------- expiration of this Warrant, all of the Company's then outstanding Class B Common Stock is converted into shares of the Company's Class A Common Stock, then this Warrant shall immediately become exercisable for that number of shares of Class A Common Stock receivable upon conversion by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such conversion, and the Exercise Price shall be immediately adjusted to equal the quotient obtained by dividing (x) the aggregate Exercise Price of the maximum number of shares of Class B Common Stock for which this Warrant was exercisable immediately prior to such conversion, by (y) the number of shares of Class A Common Stock for which this Warrant is exercisable immediately after such conversion. After any such conversion, all references herein to Class B Common Stock shall be deemed to be references to Common Stock. d. Notice of Adjustment. When any adjustment is required to be made -------------------- in the number or kind of shares purchasable upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the number of shares of Common Stock or other securities or property thereafter purchasable upon exercise of the Warrant. 3 Exercise of Warrant. This Warrant may be exercised in whole or in part, ------------------- commencing (i) one day prior to the earlier of the closing or the effective time of a "Liquidity Event," as defined herein; or, (ii) if earlier, October 14, 2001, by the surrender of this Warrant and payment to the Company by cash or check of the Exercise Price for all of the Shares purchased. The Company shall, within ten (10) days after such delivery, (a) prepare and issue a certificate for the Shares purchased in the name of the Holder of this Warrant, or as such Holder may direct (subject to the restrictions upon transfer contained herein and upon payment by such Holder hereof of any applicable transfer taxes) and (b) prepare and issue a new warrant of like terms if this Warrant is exercised for less than all of the Shares subject hereto. "Liquidity Event" shall mean (i) an acquisition, consolidation or merger of the Company with or into any other corporation or corporations unless the stockholders of the Company prior to such transaction directly or indirectly own more than fifty percent (50%) of the voting stock of the surviving or acquiring corporation or corporations; (ii) the sale, transfer or other disposition of all or substantially all of the assets of the Company to a person other than a corporation or partnership 2 controlled by the Company or its stockholders; (iii) the effectuation by the Company of a transaction or series of related transactions in which more than fifty percent (50%) of the outstanding voting power of the Company prior to such transaction or series of related transactions, is disposed of; and (iv) the closing of the sale of the Company's securities pursuant to an underwritten public offering. a. Net Issue Exercise. Notwithstanding any provisions herein to the ------------------ contrary, in lieu of exercising this Warrant for cash, the Holder may elect to receive shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company together with a properly endorsed notice of exercise and notice of such election in which event the Company shall issue to the Holder a number of shares of Class B Common Stock computed using the following formula: Y(A-B) ------ X = A Where X = the number of shares of Class B Common Stock to be issued to the Holder, Y = the number of shares of Class B Common Stock purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being canceled (at the date of such calculation), A = the fair market value of one share of the Company's Class A Common Stock (at the date of such calculation), and B = the Exercise Price (as adjusted to the date of such calculation). For purposes of the above calculation, fair market value of one share of Class A Common Stock shall be determined by the Company's Board of Directors in good faith; provided, however, that where there exists a public market for the Company's Class A Common Stock at the time of such exercise, fair market value shall mean the average over the preceding twenty (20) trading days (or such fewer number of days as such public market has existed) of the mean of the high closing bid and asked prices on the over-the-counter market as reported by Nasdaq, or if then traded on a national securities exchange or the Nasdaq National Market, the average over the preceding twenty (20) trading days (or such fewer number of days as the Class A Common Stock has been so traded) of the mean of the high and low prices on the principal national securities exchange or the National Market on which it is so traded. Notwithstanding the foregoing, in the event the Warrant is exercised in connection with the Company's initial public offering of Common Stock, the fair market value per share shall be the per share offering price to the public of the Company's initial public offering. 4. Term of Warrant. This Warrant expires and shall no longer be --------------- exercisable as of 11:59 p.m. Pacific standard time, February 6, 2008, and shall be void thereafter. 5. Conditions to Exercise of Warrant or Transfer of the Shares. It ----------------------------------------------------------- shall be a condition to any exercise of this Warrant that the Company shall have received, at the time of is such exercise, a representation in writing that the Shares being issued upon such exercise are 3 being acquired for investment and not with a view to any sale or distribution thereof, or a statement of the pertinent facts covering any proposed distribution thereof. It shall be a condition to any transfer of any or all of the Shares issued upon exercise of this Warrant, other than a transfer registered under the Securities Act of 1933, as amended (the "Act"), that the Company shall have received a legal opinion, in form and substance reasonably satisfactory to the Company and its counsel, reciting the pertinent circumstances surrounding the proposed transfer and stating that such transfer is exempt from the prospectus and the registration requirement of the Act. Each certificate evidencing the Shares issued upon exercise of this Warrant, or upon any transfer of such shares (other than a transfer registered under the Act or any subsequent transfer of shares so registered) shall, at the option of the Company, contain a legend, in form and substance satisfactory to the Company and its counsel, restricting the transfer of such shares to sales or other dispositions exempt from the requirements of the Act. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144, other than opinions with regard to sales under Rule 144(k). 6. Fractional Shares. This Warrant shall in no event be exercisable for ----------------- fractional shares, and in lieu thereof, the number of shares which would otherwise be purchased under this Warrant shall be rounded up to the nearest whole share of Common Stock. 7. Miscellaneous. ------------- a. The Company covenants that it will at all times reserve and keep available, solely for the purpose of issuance upon the exercise hereof, a sufficient number of shares of Class A or Class B Common Stock, as applicable, to permit the exercise hereof in full. Such shares when issued in compliance with the provisions of this Warrant and the Certificate of Incorporation, as amended, will be duly authorized, validly issued, fully paid and nonassessable. b. The terms of this Warrant shall be binding upon and shall inure to the benefit of any successors or assigns of the Holder hereof and of the Shares issued or issuable upon the exercise hereto. c. The Holder, as such, shall not be entitled to vote or receive dividends or be deemed to be a shareholder of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, as such, any rights of a shareholder of the Company or any right to vote, give or withhold consent to any corporate action, receive notice of meetings, receive dividends or subscription rights, or otherwise. d. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to the foregoing terms and conditions. e. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of any such loss, theft or destruction, upon delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation, upon surrender and cancellation of such Warrant, the Company at its expense will execute and deliver, in lieu thereof, a new Warrant of like date and tenor. 4 f. This Warrant shall be governed by the internal laws of the State of California. IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized officer. Dated: February 1998 -- COMPS INFOSYSTEMS, INC. By: ---------------------------- Christopher A. Crane President 5 Schedule to Exhibit 10.6 ------------------------ Name Number of Warrants ---- ------------------ Summit Ventures III, L.P. 292,658 Summit Ventures II, L.P. 5,973 Merrill Oster 7,466 EX-10.7 12 WARRANT TO PURCHASE CLASS B SHARES DATED 9/24/96 Exhibit 10.7 THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT OR (ii) IN COMPLIANCE WITH RULE 144, OR (iii) PURSUANT TO AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION. Warrant No. W-_________ WARRANT TO PURCHASE 213,068 SHARES OF CLASS B COMMON STOCK OF COMPS INFOSYSTEMS. INC. ------------------------ (Void after September 24, 2003) This certifies that VENTURE LENDING & LEASING, INC., a Maryland corporation, or assigns (the "Holder"), for value received, is entitled to purchase from COMPS InfoSystems, Inc., a Delaware corporation (the "Company"), Two Hundred Thirteen Thousand Sixty-Eight (213,068) fully paid and nonassessable shares of the Company's non-voting Class B Common Stock ("Common Stock") at a price of One and 76/100 Dollars ($1.76) per share (such price being referred to herein as the "Stock Purchase Price") at any time or from time to time up to and including 5:00 p.m. (Pacific time) on September 24, 2003 (the "Expiration Date" and subject to adjustment as set forth herein), upon surrender to the Company at its principal office at 9888 Carroll Centre Road, San Diego, CA 92126-4580 (or at such other location as the Company may advise Holder in writing) of this Warrant properly endorsed with the Form of Subscription attached hereto duly filled in and signed and upon payment in cash or by check of the aggregate Stock Purchase Price for the number of shares for which this Warrant is being exercised determined in accordance with the provisions hereof. The Stock Purchase Price and the number of shares purchasable hereunder are subject to adjustment as provided in the following sentence of this preamble, and in Section 4 of this Warrant. In the event the Company closes a round of equity financing prior to close of business on the last business day of the eighteenth full month after the issuance of this Warrant and in which equity financing the Company issues shares of Common Stock (or preferred stock convertible into Common Stock on a one-to-one basis) and receives net proceeds of offering of at least $10,000,000.00, then the initial Stock Purchase Price shall automatically be adjusted to an amount equal to the median of the per share price in such offering and $1.17, and the number of shares of Common Stock issuable hereunder shall be equal to 375,000 divided by such adjusted initial Stock Purchase Price. This Warrant is subject to the following terms and conditions: 1. Exercise; Issuance of Certificates; Payment for Shares. ------------------------------------------------------ (a) Unless an election is made pursuant to clause (b) of this Section 1, this Warrant shall be exercisable at the option of the Holder, at any time or from time to time, on or before the Expiration Date for all or any portion of the shares of Common Stock (but not for a fraction of a share) which may be purchased hereunder for the Stock Purchase Price multiplied by the number of shares to be purchased. The Company agrees that the shares of Common Stock purchased under this Warrant shall be and are deemed to be issued to the holder hereof as the record owner of such shares as of the close of business on the date on which this Warrant shall have been surrendered and payment made for such shares. Subject to the provisions of Section 2, certificates for the shares of Common Stock so purchased, together with any other securities or property to which the Holder hereof is entitled upon such exercise, shall be delivered to the Holder hereof by the Company at the Company's expense within a reasonable time after the rights represented by this Warrant have been so exercised. Except as provided in clause (b) of this Section 1, in case of a purchase of less than all the shares which may be purchased under this Warrant, the Company shall cancel this Warrant and execute and deliver to the Holder hereof within a reasonable time a new Warrant or Warrants of like tenor for the balance of the shares purchasable under the Warrant surrendered upon such purchase. Each stock certificate so delivered shall be in such denominations of Common Stock as may be requested by the Holder hereof and shall be registered in the name of such Holder or such other name as shall be designated by such Holder, subject to the limitations contained in Section 2. (b) The Holder, in lieu of exercising this Warrant by the payment of the Stock Purchase Price pursuant to clause (a) of this Section 1, may elect, at any time on or before the Expiration Date, to receive, through conversion of this Warrant or any portion hereof into that number of shares of Common Stock equal to the quotient of: (i) the difference between (A) the Per Share Price (as hereinafter defined) of the Common Stock, less (B) the Stock Purchase Price then in effect, multiplied by the number of shares of Common Stock the Holder would otherwise have been entitled to purchase hereunder pursuant to clause (a) of this Section 1 (or such lesser number of shares as the Holder may designate in the case of a partial exercise of this Warrant); over (ii) the Per Share Price. (c) For purposes of clause (b) of this Section 1, "Per Share Price" means: (i) if the Company's Common Stock is then listed or admitted to trading on any national securities exchange or traded on any national market system, the average of the closing bid and asked prices of the Company's Common Stock as reported on such exchange or market system for the ten (10) consecutive trading days prior to the date of the Holder's election to convert hereunder; (ii) if this Warrant is being converted in conjunction with a public offering of stock, the price to the public per share pursuant to the offering; or (iii) if no shares of the Company's Common Stock are listed or admitted to trading on any national securities exchange or traded on any national market system, the price per share which the Company would obtain from a willing buyer for shares sold by the Company from authorized but unissued shares as such price shall be agreed upon by the Holder and the Company or, if agreement cannot be reached within ten (10) business days of the Holder's election hereunder, as such price shall be determined by a panel of three (3) appraisers, one (1) to be chosen by the Company, one (1) to be chosen by the Holder and the third to be chosen by the first two (2) appraisers. If the appraisers cannot reach agreement within 30 days of the Holder's election hereunder, then each appraiser shall deliver its 2 appraisal and the appraisal which is neither the highest nor the lowest shall constitute the Per Share Price. In the event either party fails to choose an appraiser within 30 days of the Holder's election hereunder, then the appraisal of the sole appraiser shall constitute the Per Share Price. Each party shall bear the cost of the appraiser selected by such party and the cost of the third appraiser shall be borne one-half by each party. In the event either party fails to choose an appraiser, the cost of the sole appraiser shall be borne one- half by each party. (d) Conversion of Class B Common Stock. If at any time prior to the ---------------------------------- expiration of this Warrant, all of the Company's then outstanding Class B Common Stock is converted into shares of the Company's Class A Common Stock, then this Warrant shall immediately become exercisable for that number of shares of Class A Common Stock receivable upon conversion by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such conversion, and the Stock Purchase Price shall be immediately adjusted to equal the quotient obtained by dividing (x) the aggregate Stock Purchase Price of the maximum number of shares of Class B Common Stock for which this Warrant was exercisable immediately prior to such conversion, by (y) the number of shares of Class A Common Stock for which this warrant is exercisable immediately after such conversion. After any such conversion, all reference's herein to Class B Common Stock shall be deemed to be references to Class A Common Stock. 2. Limitation on Transfer. ---------------------- (a) This Warrant and the Common Stock shall not be transferable except upon the conditions specified in this Section 2, which conditions are intended to insure compliance with the provisions of the Securities Act. Each holder of this Warrant or the Common Stock issuable hereunder will cause any proposed transferee of the Warrant or Common Stock to agree to take and hold such securities subject to the provisions and upon the conditions specified in this Section 2. (b) Each certificate representing this Warrant or the Common Stock shall (unless otherwise permitted by the provisions of this Section 2 or unless such securities have been registered under the Securities Act or sold under Rule 144) be stamped or otherwise imprinted with a legend substantially in the form set forth on the face of this Warrant. (c) The Holder of this warrant and each person to whom this Warrant is subsequently transferred represents and warrants to the Company (by acceptance of such transfer) that it will not transfer the Warrant (or securities issuable upon exercise hereof unless a registration statement under the Securities Act was in effect with respect to such securities at the time of issuance thereof) except pursuant to (i) an effective registration statement under the Securities Act, (ii) Rule 144 under the Securities Act (or any similar rule under the Securities Act relating to the disposition of securities), or (iii) an opinion of counsel, reasonably satisfactory to counsel for the Company, that an exemption from such registration is available. 3. Shares to be Fully Paid; Reservation of Shares. The Company covenants ---------------------------------------------- and agrees that all shares of Common Stock which may be issued upon the exercise of the rights represented by this Warrant will, upon issuance, be duly authorized, validly issued, fully paid and nonassessable and free from all preemptive rights of any shareholder and free of all taxes, 3 liens and charges with respect to the issue thereof. The Company further covenants and agrees that during the period within which the rights represented by this Warrant may be exercised, the Company will at all times have authorized and reserved, for the purpose of issue or transfer upon exercise of the subscription rights evidenced by this Warrant, a sufficient number of shares of authorized but unissued Common Stock, or other securities and property, when and as required to provide for the exercise of the rights represented by this Warrant. The Company will take all such action as may be necessary to assure that such shares of Common Stock may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of any domestic securities exchange upon which the Common Stock may be listed. The Company will not take any action which would result in any adjustment of the Stock Purchase Price (as defined in Section 4 hereof) (i) if the total number of shares of Common Stock issuable after such action upon exercise of all outstanding warrants, together with all shares of Common Stock then outstanding and all shares of Common Stock then issuable upon exercise of all options and upon the conversion of all convertible securities then outstanding, would exceed the total number of shares of Common Stock then authorized by the Company's Articles of Incorporation. 4. Adjustment of Stock Purchase Price Number of Shares. The Stock --------------------------------------------------- Purchase Price and the number of shares purchasable upon the exercise of this Warrant shall be subject to adjustment from time to time upon the occurrence of certain events described in this Section 4. Upon each adjustment of the Stock Purchase Price, the Holder of this Warrant shall thereafter be entitled to purchase, at the Stock Purchase Price resulting from such adjustment, the number of shares obtained by multiplying the Stock Purchase Price in effect immediately prior to such adjustment by the number of shares purchasable pursuant hereto immediately prior to such adjustment, and dividing the product thereof by the Stock Purchase Price resulting from such adjustment. 4.1 Subdivision or Combination of Stock. In case the Company shall ----------------------------------- at any time subdivide its outstanding shares of Common Stock into a greater number of shares, the Stock Purchase Price in effect immediately prior to such subdivision shall be proportionately reduced, and conversely, in case the outstanding shares of Common Stock of the Company shall be combined into a smaller number of shares, the Stock Purchase Price in effect immediately prior to such combination shall be proportionately increased. 4.2 Dividends in Preferred Stock, Other Stock, Property, ---------------------------------------------------- Reclassification. If at any time or from time to time the holders of Common - ---------------- Stock (or any shares of stock or other securities at the time receivable upon the exercise of this Warrant) shall have received or become entitled to receive, without payment therefor, (a) by way of dividend or other distribution, any shares of stock or other securities, whether or not such securities are at any time directly or indirectly convertible into or exchangeable for Common Stock, or any rights or options to subscribe for, purchase or otherwise acquire any of the foregoing, or (b) any cash paid or payable otherwise than as a cash dividend, or (c) additional stock or other securities or property (including cash) by way of spinoff, split-up, reclassification, combination of shares or similar corporate 4 rearrangement, (other than shares of Common Stock issued as a stock split, adjustments in respect of which shall be covered by the terms of Section 4.1 above), then and in each such case, the Holder hereof shall, upon the exercise of this Warrant, be entitled to receive, in addition to the number of shares of Common Stock receivable thereupon, and without payment of any additional consideration therefore, the amount of stock and other securities and property (including cash in the cases referred to in clauses (b) and (c) above) which such Holder would hold on the date of such exercise had he been the holder of record of such Common Stock as of the date on which holders of Common Stock received or became entitled to receive such shares and/or all other additional stock and other securities and property. 4.3 Reorganization, Reclassification, Consolidation, Merger or Sale. --------------------------------------------------------------- If any capital reorganization of the capital stock of the Company, or any consolidation or merger of the Company with another corporation, or other reorganization, or the sale of all or substantially all of its assets to another corporation shall be effected in such a way that holders of Common Stock shall be entitled to receive stock, securities or assets with respect to or in exchange for Common Stock, then, as a condition of such reorganization, reclassification, consolidation, merger or sale, lawful and adequate provisions shall be made whereby the holder hereof shall thereafter have the right to purchase and receive (in lieu of the shares of the Common Stock of the Company immediately theretofore purchasable and receivable upon the exercise of the rights represented hereby) such shares of stock, securities or assets as may be issued or payable with respect to or in exchange for a number of outstanding shares of such Common Stock equal to the number of shares of such stock immediately theretofore purchasable and receivable upon the exercise of the rights represented hereby. In any such case, appropriate provision shall be made with respect to the rights and interests of the holder of this Warrant to the end that the provisions hereof (including, without limitation, provisions for adjustments of the Stock Purchase Price and of the number of shares purchasable and receivable upon the exercise of this Warrant) shall thereafter be applicable, as nearly as may be possible, in relation to any shares of stock, securities or assets thereafter deliverable upon the exercise hereof. 4.4 Notice of Adjustment. Upon any adjustment of the Stock Purchase -------------------- Price, and/or any increase or decrease in the number of shares purchasable upon the exercise of this Warrant the Company shall give written notice thereof, by first class mail, postage prepaid, addressed to the registered holder of this Warrant at the address of such holder as shown on the books of the Company. The notice shall be signed by the Company's chief financial officer and shall state the Stock Purchase Price resulting from such adjustment and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise of this Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. 4.5 Other Notices. If at any time: ------------- (a) the Company shall declare any cash dividend upon any of its stock; (b) the Company shall declare any dividend upon its stock payable in stock, or make any special dividend or other distribution to the holders of its stock; 5 (c) the Company shall offer for subscription pro rata to the holders of its Common Stock any additional shares of stock of any class or other rights; (d) there shall be any capital reorganization or reclassification of the capital stock of the Company, or consolidation or merger of the Company with, or sale of all or substantially all of its assets to, another corporation; (e) there shall be a voluntary or involuntary dissolution, liquidation or winding-up of the Company; or (f) the Company shall take or propose to take any other action, notice of which is actually provided to holders of the Common Stock; then, in any one or more of said cases, the Company shall give, by first class mail, postage prepaid, addressed to the holder of this Warrant at the address of such holder as shown on the books of the Company, (i) at least 5 business day's prior written notice of the date on which the books of the Company shall close or a record shall be taken for establishing the right to receive such dividend, distribution or subscription rights and (ii) with respect to any other action, notice of which is given to holders of the Common Stock, such notice as is actually provided to such holders. The foregoing shall not apply with respect to an Acquisition or Dissolution, notice of which shall be given in accordance with Section 4.3 above. Any notice given in accordance with the foregoing clause (i) shall also specify, in the case of any such dividend, distribution or subscription rights, the date on which the holders of stock shall be entitled thereto. Any notice given in accordance with the foregoing clause (ii) shall, if applicable, also specify the date on which the holders of Common Stock shall be entitled to exchange their Common Stock for securities or other property deliverable upon any reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding-up, or other action as the case may be. Notwithstanding the foregoing, with respect to any matter as to which the consent of stockholders is solicited by the Company in lieu of a meeting in accordance with Section 228 of the Delaware Corporation Law, the obligation of the Company to provide notice to the holder of this Warrant shall be solely as follows: (a) if the Company solicits the written consent of all stockholders, notice thereof shall be given to the holder of this Warrant at the same time that such written consent is solicited from all stockholders, and (b) if the Company does not solicit such written consent from all stockholders, then notice of the taking of the corporate action without a meeting shall be given to the holder of this Warrant no later than it is given to those stockholders who have not consented in writing. 5. Issue Tax. The issuance of certificates for shares of Preferred Stock --------- upon the exercise of the Warrant shall be made without charge to the Holder of the Warrant for any issue tax in respect thereof; provided, however, that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the issuance and delivery of any certificate in a name other than that of the then Holder of the Warrant being exercised. 6 6. Closing of Books. The Company will at no time close its transfer books ---------------- against the transfer of any Warrant or of any shares of Common Stock issued or issuable upon the exercise of any warrant in any manner which interferes with the timely exercise of this Warrant. 7. No Voting or Dividend Rights; Limitation of Liability. Nothing ----------------------------------------------------- contained in this Warrant shall be construed as conferring upon the Holder hereof the right to vote or to consent as a shareholder in respect of meetings of shareholders for the election of directors of the Company or any other matters or any rights whatsoever as a shareholder of the Company. No dividends or interest shall be payable or accrued in respect of this Warrant or the interest represented hereby or the shares purchasable hereunder until, and only to the extent that, this Warrant shall have been exercised. No provisions hereof, in the absence of affirmative action by the holder to purchase shares of Common Stock, and no mere enumeration herein of the rights or privileges of the Holder hereof, shall give rise to any liability of such Holder for the Stock Purchase Price or as a shareholder of the Company, whether such liability is asserted by the Company or by its creditors. 8. Registration Rights. The Company hereby grants to the Holder, with ------------------- respect to the shares of Common Stock issuable hereunder, the piggyback registration rights set forth in Section II.B. of that certain Investor Rights Agreement dated as of October 14, 1994 among the Company and the purchasers of its Series A Preferred Stock and Class B Common Stock Warrants (the "Investor Rights Agreement". For purposes of such Section II.B., the Holder shall be deemed a "Holder" of "Registrable Securities" as such terms are defined in the Investor Rights Agreement. 9. Rights and Obligations Survive Exercise of Warrant. The rights and -------------------------------------------------- obligations of the Company, of the Holder of this Warrant and of the holder of shares of Common Stock issued upon exercise of this Warrant, contained in Sections 6, 8 and 9 shall survive the exercise of this Warrant. 10. Modification and Waiver. This Warrant and any provision hereof may be ----------------------- changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of the same is sought. 11. Notices. Any notice, request or other document required or permitted ------- to be given or delivered to the holder hereof or the Company shall be deemed to have been given (i) upon receipt if delivered personally or by courier, (ii) upon confirmation of receipt if by telecopy, or (iii) three business days after deposit in the U.S. mail, with postage prepaid and certified or registered, to each such holder at its address as shown on the books of the Company or to the Company at the address indicated therefor in the first paragraph of this Warrant. 12. Binding Effect on Successors. This Warrant shall be binding upon any ---------------------------- corporation succeeding the Company by merger, consolidation or acquisition of all or substantially all of the Company's assets. All of the obligations of the Company relating to the Common Stock issuable upon the exercise of this Warrant shall survive the exercise and termination of this Warrant. All of the covenants and agreements of the Company shall inure to the benefit of the successors and assign of the holder hereof. The Company will, at the time of the exercise of this Warrant, in whole or in part, upon request of the Holder hereof but at the 7 Company's expense, acknowledge in writing its continuing obligation to the Holder hereof in respect of any rights (including, without limitation, any right to registration of the shares of Common Stock) to which the holder hereof shall continue to be entitled after such exercise in accordance with this Warrant; provided, that the failure of the holder hereof to make any such request shall not affect the continuing obligation of the Company to the Holder hereof in respect of such rights. 13. Descriptive Headings and Governing Law. The descriptive headings of -------------------------------------- the several sections and paragraphs of this Warrant are inserted for convenience only and do not constitute a part of this Warrant. This Warrant shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the laws of the State of California. 14. Lost Warrants or Stock Certificates. The Company represents and ----------------------------------- warrants to the Holder hereof that upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction, or mutilation of any Warrant or stock certificate and, in the case of any such loss, theft or destruction, upon receipt of an indemnity reasonably satisfactory to the Company, or in the case of any such mutilation upon surrender and cancellation of such Warrant or stock certificate, the Company at its expense will make and deliver a new Warrant or stock certificate, of like tenor, in lieu of the lost, stolen, destroyed or mutilated Warrant or stock certificate. 15. Fractional Shares. No fractional shares shall be issued upon exercise ----------------- of this Warrant. The Company shall, in lieu of issuing any fractional share, pay the holder entitled to such fraction a sum in cash equal to such fraction multiplied by the then effective Stock Purchase Price. 17. Representations of Holder. With respect to this Warrant, Holder ------------------------- represents and warrants to the Company as follows: 17.1 Experience. It is experienced in evaluating and investing in ---------- companies engaged in businesses similar to that of the Company; it understands that investment in the Warrant involves substantial risks; it has made detailed inquiries concerning the Company, its business and services, its officers and its personnel; the officers of the Company have made available to Holder any and all written information it has requested; the officers of the Company have answered to Holder's satisfaction all inquiries made by it; in making this investment it has relied upon information made available to it by the Company; and it has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of investment in the Company and it is able to bear the economic risk of that investment. 17.2 Investment. It is acquiring the Warrant for investment for its ---------- own account and not with a view to, or for resale in connection with, any distribution thereof. It understands that the Warrant, the shares of Common Stock issuable upon exercise thereof, have not been registered under the Securities Act of 1933, as amended, nor qualified under applicable state securities laws. 17.3 Rule 144. It acknowledges that the Warrant and the Common Stock -------- must be held indefinitely unless they are subsequently registered under the Securities Act or an 8 exemption from such registration is available. It has been advised or is aware of the provisions of Rule 144 promulgated under the Securities Act. 17.4 Access to Data. It has had an opportunity to discuss the -------------- Company's business, management and financial affairs with the Company's management and has had the opportunity to inspect the Company's facilities. 18. Additional Representations and Covenants of the Company. The Company ------------------------------------------------------- hereby represents, warrants and agrees as follows: 18.1 Corporate Power. The Company has all requisite corporate power --------------- and corporate authority to issue this Warrant and to carry out and perform its obligations hereunder. 18.2 Authorization. All corporate action on the part of the Company, ------------- its directors and shareholders necessary for the authorization, execution, delivery and performance by the Company of this has been taken. This Warrant is a valid and binding obligation of the Company, enforceable in accordance with its terms. 18.3 Offering. Subject in part to the truth and accuracy of Holder's -------- representations set forth in Section 17 hereof, the offer, issuance and sale of the Warrant is, and the issuance of Common Stock upon exercise of the Warrant will be exempt from the registration requirements of the Securities Act, and are exempt from the qualification requirements of any applicable state securities laws; and neither the Company nor anyone acting on its behalf will take any action hereafter that would cause the loss of such exemptions. 18.4 Stock Issuance. Upon exercise of the Warrant, the Company will -------------- use its best efforts to cause stock certificates representing the shares of Common Stock purchased pursuant to the exercise to be issued in the individual names of Holder, its nominees or assignees, as appropriate at the time of such exercise. 18.5 Articles and By-Laws. The Company has provided Holder with true -------------------- and complete copies of the Company's Certificate of Incorporation, By-Laws, and each Certificate of Determination or other charter document setting, forth any rights, preferences and privileges of Company's capital stock, each as amended and in effect on the date of issuance of this Warrant. 18.6 Financial and Other Reports. From time to time up to the --------------------------- earlier of the Expiration Date or the complete exercise of this Warrant, the Company shall furnish to Holder (i) within 90 days after the close of each fiscal year of the Company an audited balance sheet and statement of changes in financial position at and as of the end of such fiscal year, together with an audited statement of income for such fiscal year; (ii) within 45 days after the close of each fiscal quarter of the Company, an unaudited balance sheet and statement of cash flows at and as of the end of such quarter, together with an unaudited statement of income for such quarter; and (iii) promptly after sending, copies of all reports, proxy statements, and financial statements that the Company sends to its shareholders. 9 IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its officers, thereunto duly authorized as of the 24th day of September, 1996. COMPS InfoSystems, Inc. By: /s/ Christopher A. Crane --------------------------- Name: C. A. Crane -------------- Title: President -------------- 10 FORM OF SUBSCRIPTION -------------------- (To be signed only upon exercise of Warrant) To: ________________________________ The undersigned, the holder of the within Warrant, hereby irrevocably elects to exercise the purchase right represented by such Warrant for, and to purchase thereunder, _________________________________ (_______) (1) shares of Common Stock of COMPS InfoSystems, Inc. and herewith makes payment of ______________________________ Dollars ($__________) therefor, and requests t at the certificates for such shares be issued in the name of, and delivered to, _____________________________, whose address is ___________________________________. The undersigned represents that it is acquiring such Common Stock for its own account for investment and not with a view to or for sale in connection with any distribution thereof (subject, however, to any requirement of law that the disposition thereof shall at all times be within its control. DATED: ___________________ ______________________________________________________ (Signature must conform in all respects to name of holder as specified on the face of the Warrant) ______________________________________________________ ______________________________________________________ (Address) ________________ (1) Insert here the number of shares called for on the face of the Warrant (or, in the case of a partial exercise, the portion thereof as to which the Warrant is being exercised), in either case without making any adjustment for additional Common Stock or any other stock or other securities or property or cash which, pursuant to the adjustment provisions of the Warrant, may be deliverable upon exercise. ASSIGNMENT ---------- FOR VALUE RECEIVED, the undersigned, the holder of the within Warrant, hereby sells, assigns and transfers all of the rights of the undersigned under the within Warrant, with respect to the number of shares of Common Stock covered thereby set forth hereinbelow, unto: Name of Assignee Address No. of Shares ---------------- ------- ------------- Dated: ----------------- -------------------------------------------------- (Signature must conform in all respects to name of holder as specified on the face of the Warrant) EX-10.8 13 LOAN AGREEMENT DATED 9/24/96 EXHIBIT 10.8 - -------------------------------------------------------------------------------- LOAN AGREEMENT Dated as of September 24, 1996 between COMPS InfoSystems, Inc., as Borrower, and VENTURE LENDING & LEASING, INC., as Lender - -------------------------------------------------------------------------------- TABLE OF CONTENTS ----------------- Page ---- ARTICLE 1 - DEFINITIONS....................................... 1 ARTICLE 2 - THE FACILITIES AND RELATED TERMS AND CONDITIONS... 6 2.1 Term Loan........................................... 6 2.2 Equipment Loans..................................... 7 2.3 Limitations on Loans................................ 7 2.4 Notes Evidencing Loans; Repayment................... 7 2.5 Procedures for Borrowing............................ 8 2.6 Interest............................................ 8 2.7 Interest Rate Calculation........................... 8 2.8 Default Interest.................................... 8 2.9 Prepayment of Loans................................. 9 2.10 Lender's Records.................................... 9 2.11 Security............................................ 9 2.12 Issuance of Warrant to Lender; Commitment Fee....... 10 ARTICLE 3 - REPRESENTATIONS AND WARRANTIES.................... 11 3.1 Due Organization.................................... 11 3.2 Authorization, Validity and Enforceability.......... 11 3.3 Compliance with Applicable Laws..................... 11 3.4 Copyrights, Patents, Trademarks and Licenses........ 11 3.5 No Conflict......................................... 11 3.6 No Litigation, Claims or Proceedings................ 12 3.7 Correctness of Financial Statements................. 12 3.8 No Subsidiaries..................................... 12 3.9 Environmental Matters............................... 12 3.10 No Event of Default................................. 12 3.11 Full Disclosure..................................... 12 ARTICLE 4 - CONDITIONS PRECEDENT.............................. 12 4.1 Conditions to First Loan............................ 12 4.2 Conditions to All Loans............................. 13 4.3 Condition Subsequent................................ 14 ARTICLE 5 - AFFIRMATIVE COVENANTS............................. 14 5.1 Notice to Lender.................................... 14 5.2 Financial Statements................................ 15 5.3 Managerial Assistance from Lender................... 16 5.4 Existence........................................... 16 5.5 Insurance........................................... 16 5.6 Accounting Records.................................. 16 5.7 Compliance With Laws................................ 17 TABLE OF CONTENTS (CONTINUED) Page ---- 5.8 Taxes and Other Liabilities......................... 17 5.9 Use of Proceeds..................................... 17 ARTICLE 6 - NEGATIVE COVENANTS................................ 17 6.1 Indebtedness........................................ 17 6.2 Liens. 18 6.3 Dividends........................................... 18 6.4 Changes/Mergers..................................... 18 6.5 Sales of Assets..................................... 18 6.6 Loans/Investments................................... 18 6.7 Transactions With Related Persons................... 19 6.8 Other Business...................................... 19 ARTICLE 7 - EVENTS OF DEFAULT................................. 19 7.1 Events of Default................................... 19 ARTICLE 8 - GENERAL PROVISIONS................................ 20 8.1 Notices............................................. 20 8.2 Binding Effect...................................... 21 8.3 No Waiver........................................... 21 8.4 Rights Cumulative................................... 21 8.5 Unenforceable Provisions............................ 21 8.6 Accounting Terms.................................... 21 8.7 Indemnification; Exculpation........................ 22 8.8 Reimbursement....................................... 22 8.9 Execution in Counterparts........................... 22 8.10 Entire Agreement.................................... 22 8.11 Governing Law and Jurisdiction...................... 22 8.12 Waiver of Jury Trial................................ 23 LIST OF EXHIBITS ---------------- Exhibit "A" Form of Note Exhibit "B" Form of Borrowing Request Exhibit "C" Security Agreement Exhibit "D" Form of Warrant LIST OF SCHEDULES ----------------- Schedule 3.6 Litigation Schedule 6.1 Indebtedness Schedule 6.2 Liens (ii) LOAN AGREEMENT This LOAN AGREEMENT is entered into as of September 24, 1996, between COMPS INFOSYSTEMS, INC., a Delaware corporation ("Borrower"), and VENTURE LENDING & LEASING, INC., a Maryland corporation ("VLLI" or "Lender"). WHEREAS, Lender has agreed to make available to Borrower a working capital term loan, and an equipment acquisition term loan facility upon the terms and conditions set forth in this Agreement. NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained herein, the parties agree as follows: ARTICLE 1 - DEFINITIONS The definitions appearing in this Agreement or any supplement or addendum to this Agreement, shall be applicable to both the singular and plural forms of the defined terms: "Account Debtor" means the Person obligated upon an Account. "Accounts" means (i) all rights to the payment of money now owned or hereafter acquired by Borrower, whether due or to become due and whether or not: earned by performance, including but not limited to, accounts, chattel paper, instruments, and general intangibles; and (ii) for purposes of this Agreement amounts to become payable by existing subscribers to Borrower's database services with respect to subscriptions which are eligible or scheduled for renewal within ninety (90) days after any date of determination of Eligible Accounts. "Additional Interest" means, with respect to each Loan, an amount of interest payable thereon, in addition to Basic Interest, payable on the Maturity Date of such Loan in an amount equal to fifteen percent (15%) of the original principal amount of such Loan. "Affiliate" means any Person which directly or indirectly controls, is controlled by, or is under common control with, Borrower. "Control," "controlled by" and "under common control with" means direct or indirect possession of the power to direct or cause the direction of management or policies (whether through ownership of voting securities, by contract or otherwise); provided that control shall be conclusively presumed when any Person or affiliated group directly or indirectly owns ten (10%) or more of the securities having ordinary voting power for the election of directors of a corporation. "Agreement" means this Loan Agreement as it may be amended or supplemented from time to time. "Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C. (S)101, et seq.), as amended. -- --- "Basic Interest" means the fixed rate of interest payable on the outstanding balance of each Loan at the applicable Designated Rate. "Borrowing Base" means, with respect to the Term Loan as of date of determination, an amount at all times equal the lesser of (a) $1,500,000; or (b) eighty percent (80%) of Borrower's Eligible Accounts. "Borrowing Date" means the Business Day on which the proceeds of a Loan are disbursed by Lender. "Borrowing Request" means a written request from Borrower in substantially the form of Exhibit "B" hereto, requesting the funding of one or ---------- more Loans on a particular Borrowing Date. "Business Day" means any day other than a Saturday, Sunday or other day on which commercial banks in New York City or San Francisco are authorized or required by law to close. "Closing Date" means the date of this Agreement. "Collateral" has the meaning ascribed thereto in the Security Agreement. "Commitment" means, with respect to each of the Term Loan Facility and the Equipment Loan Facility, the obligation of Lender to make Loans under each Facility to Borrower in an aggregate, original principal amount not exceeding One Million Five Hundred Thousand Dollars ($1,500,000), respectively. "Default" means an event which with the giving of notice, passage of time, or both would constitute an Event of Default. "Default Rate" is defined in Section 2.8. ----------- "Designated Rate" means a fixed rate of interest per annum applicable to a Loan equal to eight and 75/100 percent (8.75%). "Eligible Account" shall mean an Account: (a) Arising from the sale or lease of goods, or the licensing of data, or the performance of services by Borrower in the ordinary course of Borrower's business; (b) Against which is asserted no defense, counterclaim, discount, or setoff; (c) That is an accurate statement of the indebtedness incurred by the Account Debtor; -2- (d) Owned by Borrower free and clear of all liens, rights, claims, and interests of others except security interests in favor of Lender; (e) That does not arise from a sale or lease to or performance of services for an individual or entity employed by or having common ownership with Borrower; (f) That is not in default. An Account shall be deemed in default upon the occurrence of any of the following: (i) The Account is not paid or payable within a ninety (90)-day period starting from the original invoice date; (ii) The Account Debtor suspends business, becomes insolvent, or fails to pay its debts generally as they come due; or (iii) Any petition is filed by or against the Account Debtor under the Bankruptcy Reform Act, Title 11 of the United States Code or under any other law relating to bankruptcy, insolvency, reorganization or other relief for debtors. (g) That is not the obligation of an Account Debtor that is the federal government, any state or political subdivision thereof, unless Borrower has complied in form and substance satisfactory to Lender with the Assignment of Claims Act(s) or any successor thereof in effect from time to time, or other applicable law(s) or regulations; (h) That is not the obligation of an Account Debtor located in a foreign country, unless Lender consents in writing and the Account is insured by the Foreign Credit Insurance Association or covered by a letter of credit issued or confirmed by a bank located in the United States of America acceptable to Lender, each such insurance policy or letter of credit being in form and substance satisfactory to Lender; and (i) That is otherwise acceptable to Lender. "Environmental Laws" means all federal, state or local laws, statutes, common law duties, rules, regulations, ordinances and codes, together with all administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any governmental authorities, in each case relating to environmental, health, or safety matters. "Equipment Loan" means an extension of credit by Lender under Section ------- 2.2 of this Agreement. - --- "Event of Default" means any event described in Article 7. -3- "Facility" means each credit accommodation being provided Borrower under the terms and conditions of this Agreement, which credit accommodations are the Term Loans and the Equipment Loans, as more fully described in Article 2. "GAAP" means generally accepted accounting principles and practices consistent with those principles and practices promulgated or adopted by the Financial Accounting Standards Board and the Board of the American Institute of Certified Public Accountants, their respective predecessors and successors. Each accounting term used but not otherwise expressly defined herein shall have the meaning given it by GAAP. "Indebtedness" of any Person means at any date, without duplication and without regard to whether matured or unmatured, absolute or contingent: (i) all obligations of such Person for borrowed money; (ii) all obligations of such Person evidenced by bonds, debentures, notes, or other similar instruments; (iii) all obligations of such Person to pay the deferred purchase price of property or services, except trade accounts payable arising in the ordinary course of business; (iv) all obligations of such Person as lessee under capital leases; (v) all obligations of such Person to reimburse or prepay any bank or other Person in respect of amounts paid under a letter of credit, banker's acceptance, or similar instrument, whether drawn or undrawn; (vi) all obligations of such Person to purchase securities which arise out of or in connection with the sale of the same or substantially similar securities; (vii) all obligations of such Person to purchase, redeem, or otherwise acquire, for cash on a present or deferred basis, any capital stock of such Person or any warrants, rights or options to acquire such capital stock, now or hereafter outstanding, except to the extent that such obligations remain performable solely at the option of such Person; (viii) all obligations to repurchase assets previously sold (including any obligation to repurchase any accounts or chattel paper under any factoring, receivables purchase, or similar arrangement); (ix) obligations of such Person under interest rate swap, cap, collar or similar hedging arrangements; and (x) all obligations of others of any type described in clause (i) through clause (ix) above guaranteed by such Person. - ---------- ----------- "Insolvency Proceeding" means (a) any case, action or proceeding before any court or other governmental authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (b) any general assignment for the benefit of creditors, composition, marshalling of assets for creditors, or other, similar arrangement in respect of its creditors generally or any substantial portion of its creditors, undertaken under U.S. Federal, state or foreign law, including the Bankruptcy Code. "Lien" means any voluntary or involuntary security interest, mortgage, pledge, claim, charge, encumbrance, title retention agreement, or third party interest, covering all or any part of the property of Borrower or any other Person. "Loan" means any Term Loan or any Equipment Loan. "Loan Documents" means, individually and collectively, this Agreement, each Note, the Security Agreement and any other security or pledge agreement(s), and all other -4- contracts, instruments, addenda and documents executed in connection with this Agreement or the extensions of credit which are the subject of this Agreement. "Material Adverse Effect" or "Material Adverse Change" means (a) a material adverse change in, or a material adverse effect upon, the operations, business, properties, or condition (financial or otherwise) of Borrower; (b) a material impairment of the ability of Borrower to perform under any Loan Document; or (c) a material adverse effect upon the legality, validity, binding effect or enforceability against Borrower of any Loan Document. "Maturity Date" means, with regard to a Loan, the earlier of (i) its maturity by reason of acceleration, or (ii) its stated maturity date, which is the first day of the 49th full month after the Borrowing Date of an Equipment Loan and the first day of the 37th full month after the Borrowing Date of the a Term Loan; and is the date on which payment of all outstanding principal and accrued interest, including Additional Interest, is due. "Note" means a promissory note substantially in the form of Exhibit ------- "A" hereto, executed by Borrower evidencing each Loan. "Obligations" means all advances, debts, liabilities, obligations, covenants and duties arising under any Loan Document, owing by Borrower to Lender, whether direct or indirect (including those acquired by assignment), absolute or contingent, due or to become due, now existing or hereafter arising. "Permitted Lien" means (a) Involuntary Liens which, in the aggregate, would not have a Material Adverse Effect and which in any event would not exceed One-Hundred Thousand Dollars ($100,000); (b) Liens for current taxes or other governmental or regulatory assessments which are not delinquent, or which are contested in good faith by the appropriate procedures and for which appropriate reserves are maintained; (c) Purchase money security interests on any property held or acquired by Borrower in the ordinary course of business securing Indebtedness incurred or assumed for the purpose of financing all or any part of the cost of acquiring such property; provided, that such Lien -------- attaches solely to the property acquired with such Indebtedness and that the principal amount of such Indebtedness does not exceed one hundred percent (100%) of the cost of such property; and further provided, that ------- -------- such property is not equipment with respect to which a Loan has been made hereunder. (d) Liens in favor of Lender; (e) bankers' liens, rights of setoff and similar Liens incurred on deposits made in the ordinary course of business; -5- (f) materialmen's, mechanics', repairmen's, employees, or other like Liens arising in the ordinary course of business and which are not delinquent for more than 45 days or are being contested in good faith by appropriate proceedings; (g) any judgment, attachment or similar Lien, unless the judgment it secures has not been discharged or execution thereof effectively stayed and bonded against pending appeal within 30 days of the entry thereof; (h) licenses or sublicenses of Patents, Patent Licenses, Trademarks or Trademark Licenses permitted under the Trademark Collateral Assignment or the Patent Collateral Assignment (all as defined in the Security Agreement); and . (i) Liens which have been approved by Lender prior to the Closing Date and disclosed on Schedule 6.2 to this Agreement. ------------ "Person" means any individual or entity. "Qualified Public Offering" means the closing of a firmly underwritten public offering of Borrower's common stock with aggregate proceeds of not less than $10,000,000 (prior to underwriting expenses and commissions). "Related Person" means any Affiliate of Borrower, or any officer, employee, director or shareholder of Borrower or any Affiliate. "Security Agreement" means the Security Agreement substantially in the form of Exhibit "C" hereto, executed by Borrower. "Term Loan" means an extension of credit by Lender under Section 2.1 ----------- of this Agreement. "Termination Date" means the earlier of: (a) the date Lender may terminate making Loans or extending credit pursuant to the rights of Lender under Article 7, or (b) June 30, 1998. "UCC" means the Uniform Commercial Code as enacted in the applicable jurisdiction, in effect on the Closing Date and as amended from time to time. ARTICLE 2 - THE FACILITIES AND RELATED TERMS AND CONDITIONS Subject to the terms and conditions of this Agreement, the following Facilities shall be available to Borrower: 2.1 Term Loan. Subject to the terms and conditions of this Agreement, Lender agrees to make term loans to Borrower from time to time from the Closing Date and to the Termination Date in an aggregate principal amount not exceeding the Commitment, the proceeds of which shall be used by Borrower for working capital and general corporate purposes. -6- The Commitment is not a revolving credit commitment, and Borrower shall not have the right to repay and reborrow hereunder. 2.2 Equipment Loans. Subject to the terms and conditions of this Agreement, Lender agrees to make term loans to Borrower from time to time from the Closing Date and to the Termination Date in an aggregate principal amount not exceeding the Commitment, the proceeds of which shall be used to finance Borrower's acquisition or carrying of equipment. The Commitment is not a revolving credit commitment, and Borrower shall not have the right to repay and reborrow hereunder. 2.3 Limitations on Loans. (a) Each Equipment Loan shall be in an amount not to exceed one hundred percent (100%) of the amount paid or payable by Borrower to a non- affiliated manufacturer, vendor or dealer for an item of equipment as shown on an invoice therefor (excluding any commissions and any portion of the payment which relates to the servicing of the equipment and sales taxes payable by Borrower upon acquisition, and delivery charges). (b) Lender shall not be obligated to make any Loan if at the time of or after giving effect to the proposed Loan Lender would no longer qualify as: (A) a "venture capital operating company" under U.S. Department of Labor Regulations Section 2510.3-101(d), Title 29 of the Code of Federal Regulations, as amended; and (B) a "business development company" under the provisions of federal Investment Company Act of 1940, as amended; and (C) a "regulated investment company" under the provisions of the Internal Revenue Code of 1986, as amended. (c) Each Loan requested by Borrower to be made on a single Business Day shall be for a principal amount of One Hundred Thousand Dollars ($100,000) or more, except to the extent the remaining Commitment is a lesser amount. 2.4 Notes Evidencing Loans; Repayment. Each Loan and Basic Interest and Additional Interest thereon shall be evidenced by a separate Note payable to the order of Lender substantially in the form of Exhibit "A" to this Agreement, ----------- in the principal amount of the Loan. Each Note shall be payable as follows: Principal and Basic Interest shall be paid in forty-eight (48) (or thirty-six (36) in the case of the Term Loan only) equal and successive monthly payments, in advance, beginning on the Borrowing Date and continuing on the first Business Day of each month thereafter; provided, that the first and last such -------- amortization installment payments shall be paid in advance on the Borrowing date. If the Borrowing Date is not the first day of a month, then the 48 (or 36, in the case of the Term Loan) month amortization period shall commence on the first day of the next month following the Borrowing Date, and interest only shall accrue and be payable for the period from the Borrowing Date to the first day of the next month. Borrower shall pay to Lender, in advance, on the Borrowing Date a payment of Basic Interest on the amount of any Loan that is not made on the first day of the month for interest that will accrue on such Loan from the Borrowing Date through the last day of the same -7- month. The payment of amortization installments of principal of and interest on a Loan in advance results in a higher effective rate of interest than the stated Designated Rate applicable to such Loan. 2.5 Procedures for Borrowing. (a) Borrower shall give Lender at least five (5) Business Days' prior to a proposed Borrowing Date written notice of any request for borrowing hereunder (a "Borrowing Request"). Each Borrowing Request shall be in substantially the form of Exhibit "B" hereto, shall be executed by ----------- the chief financial officer of Borrower, and shall state how much is requested, and shall be accompanied by such additional information and documentation as Lender may deem reasonably necessary to determine whether the proposed borrowing will comply with the limitations in Section 2.2. In ----------- the case of each Equipment Loan, the Borrowing Request therefor shall also certify that all equipment to be financed thereby is, or will upon acquisition be, owned by Borrower free and clear of all Liens except in favor of Lender. (b) No later than 1:00 p.m. Pacific Standard Time on the Borrowing Date, if Borrower has satisfied the conditions precedent in Article 4, Lender shall make the Loan available to Borrower in immediately available funds, less the amount of the broker's fee described in Section 2.5(c) below. (c) Borrower authorizes and directs Lender, and Lender agrees, to remit directly to Mr. Doug Wall on each Borrowing Date two percent (2%) of the proceeds of each Loan, as a broker's fee for the Facilities. 2.6 Interest. Basic Interest on the outstanding principal balance of the each Loan shall accrue daily at the Designated Rate from the Borrowing Date until the Maturity Date. On the Maturity Date (whether at stated maturity, prepayment or acceleration) of a Loan, Borrower shall pay full amount of the Additional Interest thereon. 2.7 Interest Rate Calculation. Basic Interest, along with charges and fees under this Agreement and any Loan Document, shall be calculated for actual days elapsed on the basis of a 360-day year, which results in higher interest, charge or fee payments than if a 365-day year were used. In no event shall Borrower be obligated to pay Lender interest, charges or fees at a rate in excess of the highest rate permitted by applicable law from time to time in effect. 2.8 Default Interest. Any unpaid payments of principal or interest with respect to any Loan shall bear interest from their respective maturities, whether scheduled or accelerated, at the Designated Rate for such Loan plus five percent (5.00%) per annum, until paid in full, whether before or ---- after judgment (the "Default Rate"). Borrower shall pay such interest on demand. -8- 2.9 Prepayment of Loans. (a) Mandatory Prepayments of Term Loan. Borrower agrees that if the outstanding principal balance of the Term Loan on any date exceeds the Borrowing Base on such date, then Borrower will immediately prepay the Term Loan in an amount equal to the excess. (b) Mandatory Prepayments of Equipment Loans. Borrower shall be required to prepay any Equipment Loan from the net proceeds of any insurance or condemnation awards paid in respect of the items of equipment financed with the proceeds of such Loan; provided, that such prepayment -------- shall not be required, so long as no Event of Default otherwise exists, (i) if Borrower uses such net proceeds to purchase replacements of equipment lost through casualty or condemnation and such replacement equipment is subject to no Liens other than Lender's, or (ii) with respect to losses of equipment which in aggregate during any consecutive twelve-month period has a fair market value or book value, whichever is more, of $75,000 or less. (c) Prepayments Generally. No Loan may be voluntarily prepaid except as provided in this subsection (c). Borrower may prepay any Loan, in whole or in part in minimum payments of $50,000 at any time after the first anniversary of the Borrowing Date for such Loan; provided that -------- any prepayment, whether voluntary or involuntary as a result of acceleration or otherwise, must be accompanied by payment of: (i) a premium equal to 2.00% of the amount of principal so prepaid if such prepayment is made during the 12-month period between the first and second anniversaries, or a 1.00% premium if such prepayment is made during the 12-month period between the second and third anniversaries (there being no premium or penalty payable after the third anniversary of the Borrowing Date of such Loan); (ii) accrued Basic Interest to the date of such prepayment; and (iii) all Additional Interest on the Loan so prepaid (or a ratable portion of such Additional Interest, if less than all of the Loan is prepaid). Unless otherwise agreed by Lender, any partial prepayment of a Loan shall be applied in inverse order of maturity to the most remote principal installment then unpaid on such Loan. No premium or penalty shall be required in the case of a prepayment of all Loans following Lender's refusal to fund any portion of the Commitment pursuant to Section 2.3(b) or Section 4.2(b). 2.10 Lender's Records. Principal, Basic Interest, Additional Interest and all other sums owed under any Loan Document shall be evidenced by entries in records maintained by Lender for such purpose. Each payment on and any other credits with respect to principal, Basic Interest, Additional Interest and all other sums outstanding under any Loan Document shall be evidenced by entries in such records. Absent manifest error, Lender's records shall be conclusive evidence thereof. 2.11 Security. As security for all Obligations to Lender, Borrower shall grant concurrently to Lender, or ensure that Lender is concurrently granted, perfected security interests of first priority in all of the Collateral pursuant to the Security Agreement, subject only to Liens -9- disclosed to and approved by Lender prior to the Closing Date. If upon payment in full of all Obligations in respect of the Term Loan there remain outstanding Obligations in respect of any Equipment Loans, and if no Event of Default then exists, then Lender shall release its security interests in all Collateral except Equipment and Proceeds and Records relating solely to Equipment. If upon - ------ payment in full of all Obligations in respect of all Equipment Loans there remain outstanding Obligations in respect of the Term Loan, and if no Event of Default then exists, then Lender shall release its security interests in all Collateral comprising Equipment and Proceeds and Records relating solely to ---------- Equipment. 2.12 Issuance of Warrant to Lender; Commitment Fee. (a) Warrant. As additional consideration for the making of the ------- Loans under this Agreement, upon the making of, and as a condition to, the initial Loan, Lender shall be entitled to receive a warrant to purchase a number of shares of common stock of Borrower ("Warrant Shares") with a value equal to $375,000, determined on the basis of an initial exercise price per share of common stock that is the median of (i) $1.17, and (ii) the per share price of common stock (or other equity securities exercisable, convertible or exchangeable for common stock) in Borrower's next round of equity financing subsequent to the Closing Date; provided, -------- that if no round of equity financing under the foregoing clause (ii) closes within eighteen months after the Closing Date, then the applicable initial exercise price per share shall be 1.76. The warrant issued under this Agreement shall be in substantially the form attached hereto as Exhibit ------- "D"; shall be transferable by Lender, subject to compliance with applicable --- securities laws; shall expire not earlier than seven (7) years after its date of issuance; and shall include piggy-back registration rights, "net issuance" provisions, and antidilution protections reasonably satisfactory to Lender and its counsel. (b) Commitment Fee. In consideration of Lender's commitments -------------- hereunder, Borrower shall pay Lender a fee (the "Commitment Feel") in the amount of $30,000. Lender acknowledges prior receipt of $10,000 of the Commitment Fee, and Borrower agrees to pay the $20,000 balance not later than the Borrowing Date of the initial Loan. (c) Reduction of Warrant and Fee. Notwithstanding anything to ---------------------------- the contrary in Section 2.12(a) or (b), if Lender has not made Loans in the aggregate principal amount equal to the aggregate Commitment by June 30, 1998, solely as a result of either the limitation on Lender under Section 2.3(b) or Lender's determination that the condition precedent in Section 4.2(b) has not been satisfied, then the maximum number of shares issuable under the Warrant shall be reduced proportionately based on the ratio of the aggregate principal amount of Loans actually funded over the aggregate Commitment; and VLLI shall refund to Borrower a proportionate amount of the Commitment Fee. -10- ARTICLE 3 - REPRESENTATIONS AND WARRANTIES Borrower represents and warrants that as of the Closing Date and each Borrowing Date: 3.1 Due Organization. Borrower is a corporation duly organized and validly existing in good standing under the laws of Delaware, and is duly qualified to conduct business and is in good standing in each other jurisdiction in which its business is conducted or its properties are located, except where the failure to be so qualified would not reasonably be expected to have a Material Adverse Effect. 3.2 Authorization, Validity and Enforceability. The execution, delivery and performance of all Loan Documents executed by Borrower are within Borrower's powers, have been duly authorized, and are not in conflict with Borrower's certificate of incorporation or by-laws, or the terms of any charter or other organizational document of Borrower, as amended from time to time; and all such Loan Documents constitute valid and binding obligations of Borrower, enforceable in accordance with their terms (except as may be limited by bankruptcy, insolvency and similar laws affecting the enforcement of creditors' rights in general, and subject to general principles of equity). 3.3 Compliance with Applicable Laws. Borrower has complied with all licensing, permit and fictitious name requirements necessary to lawfully conduct the business in which it is engaged, and to any sales, leases or the furnishing of services by Borrower, including without limitation those requiring consumer or other disclosures, the noncompliance with which would have a Material Adverse Effect. 3.4 Copyrights, Patents, Trademarks and Licenses. (a) Borrower owns or is licensed or otherwise has the right to use all of the patents, trademarks, service marks, trade names, copyrights, contractual franchises, authorizations and other similar rights that are reasonably necessary for the operation of its business, without conflict with the rights of any other Person. (b) To Borrower's knowledge, no slogan or other advertising device, product, process, method, substance, part or other material now employed, or now contemplated to be employed, by Borrower infringes upon any rights held by any other Person. (c) No claim or litigation regarding any of the foregoing is pending or, to Borrower's knowledge, threatened, and no patent, invention, device, application, principle or any statute, law, rule, regulation, standard or code is pending or proposed which, in either case, could reasonably be expected to have a Material Adverse Effect. 3.5 No Conflict. The execution, delivery, and performance by Borrower of all Loan Documents are not in conflict with any law, rule, regulation, order or directive, or any -11- indenture, agreement, or undertaking to which Borrower is a party or by which Borrower may be bound or affected. 3.6 No Litigation, Claims or Proceedings. There is no litigation, tax claim, proceeding or dispute pending, or, to the knowledge of Borrower, threatened against or affecting Borrower or its property, except as set forth in Schedule 3.6. - ------------ 3.7 Correctness of Financial Statements. Borrower's financial statements which have been delivered to Lender fairly and accurately reflect Borrower's financial condition as of July 31, 1996; and, since that date there has been no Material Adverse Change. 3.8 No Subsidiaries. Borrower is not a majority owner of or in a control relationship with any other business entity. 3.9 Environmental Matters. Borrower has reviewed, or caused to be reviewed on its behalf, all Environmental Laws applicable to its business operations and materials handled therein, and as a result thereof has reasonably concluded that Borrower is in compliance with such Environmental Laws, except to the extent a failure to be in such compliance could not reasonably be expected to have a Material Adverse Effect on Borrower's operations, properties or financial condition. 3.10 No Event of Default. No Default or Event of Default has occurred and is continuing. 3.11 Full Disclosure. None of the representations or warranties made by Borrower in the Loan Documents as of the date such representations and warranties are made or deemed made, and none of the statements contained in any exhibit, report, statement or certificate furnished by or on behalf of Borrower in connection with the Loan Documents (including disclosure materials delivered by or on behalf of Borrower to Lender prior to the Closing Date), contains any untrue statement of a material fact or omits any material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they are made, not misleading as of the time when made or delivered. ARTICLE 4 - CONDITIONS PRECEDENT 4.1 Conditions to First Loan. The obligation of Lender to make its first Loan hereunder is, in addition to the conditions precedent specified in Section 4.2, subject to the fulfillment of the following conditions and to the - ----------- receipt by Lender of the documents described below, duly executed and in form and substance satisfactory to Lender and its counsel: (a) Resolutions. A certified copy of the resolutions of the Board of Directors of Borrower authorizing the execution, delivery and performance by Borrower of the Loan Documents. -12- (b) Incumbency and Signatures. A certificate of the secretary of Borrower certifying the names of the officer or officers of Borrower authorized to sign the Loan Documents, together with a sample of the true signature of each such officer. (c) Opinion of Counsel. The opinion of Latham & Watkins, counsel for Borrower, together with any opinions, certificates and other matters on which such opinion relies. (d) Articles and By-Laws. Certified copies of the Certificate of Incorporation and By-Laws of Borrower, as amended through the Closing Date. (e) The Agreement. A counterpart of this Agreement with all schedules completed and attached thereto, and disclosing such information as is acceptable to Lender. (f) Security Agreement; Financing Statements. A Security Agreement executed by Borrower, substantially in the form of Exhibit "C", ----------- together with filing copies (or other evidenced of filing satisfactory to Lender and its counsel) of such Uniform Commercial Code financing statements, collateral assignments and termination statements, with respect to the Collateral (as defined in such Security Agreement) as Lender shall request. (g) Patent and Trademark Assignments. Patent and trademark collateral assignments executed by Borrower, substantially in the forms attached to Exhibit "C". ----------- (h) Lien Searches. Uniform Commercial Code lien, judgment, bankruptcy and tax lien searches of Borrower from the California Secretary of State, and such other jurisdictions as Lender may reasonably request, all as of a date reasonably satisfactory to Lender and its counsel. (i) Good Standing Certificate. A Certificate of Good Standing as of a date acceptable to Lender with respect to Borrower from the California Secretary of State. (j) Warrant. A warrant issued by Borrower to Lender exercisable for the Warrant Shares, as described in Section 2.12 hereof. ------------ 4.2 Conditions to All Loans. The obligation of Lender to make its initial Loan and each subsequent Loan is subject to the following further conditions precedent that: (a) No Default. No Default or Event of Default has occurred and is continuing or will result from the making of any such Loan, and the representations and warranties of Borrower contained in Article 3 of this Agreement are true and correct as of the Borrowing Date of such Loan. -13- (b) No Adverse Material Change. No Material Adverse Change shall have occurred since the date of the most recent financial statements submitted to Lender. (c) Note. Borrower shall have delivered an executed Note evidencing such Loan, in form and substance satisfactory to Lender. (d) Borrowing Request. Borrower shall have delivered to Lender a Borrowing Request for such Loan. (e) VCOC Limitation. The making of the Loan will not result in a violation of the condition applicable to Lender described in Section 2.3 ----------- (b). --- 4.3 Condition Subsequent. Not later than sixty (60) days after the first Borrowing Date, Borrower shall have delivered or cause to be delivered to Lender satisfactory results of searches of the records of the U.S. Patent and Trademark Office reflecting the collateral assignments recorded in favor of Lender, subject to no prior Liens except those permitted in Section 6.2 hereof. ----------- ARTICLE 5 - AFFIRMATIVE COVENANTS During the term of this Agreement and until its performance of all obligations to Lender, Borrower will: 5.1 Notice to Lender. Promptly give written notice to Lender of: (a) Any litigation or administrative or regulatory proceeding affecting Borrower where the amount claimed against Borrower is Fifty Thousand Dollars ($50,000) or more, or where the granting of the relief requested would have a Material Adverse Effect. (b) Any substantial dispute which may exist between Borrower or any governmental or regulatory authority. (c) The occurrence of any Event of Default or any event which with the giving of notice, the passage of time, or both, would constitute an Event of Default. (d) Any change in the location of any of Borrower's places of business at least thirty (30) days in advance of such change, or of the establishment of any new, or the discontinuance of any existing, place of business. (e) Any dispute or default by Borrower or any other party under any joint venture, partnering, distribution, cross-licensing, strategic alliance, collaborative research or manufacturing, license or similar agreement which could reasonably be expected to have a material Adverse Effect. -14- (f) Any other matter which has resulted or might reasonably result in a Material Adverse Change. 5.2 Financial Statements. Deliver to each Lender or cause to be delivered to Lender, in form and detail satisfactory to Lender the following financial information, which Borrower warrants shall be accurate and complete in all material respects: (a) Monthly Financial Statements. As soon as available but no later than thirty (30) days after the end of each month, Borrower's balance sheet as of the end of such period, and Borrower's income statement for such period and for that portion of Borrower's financial reporting year ending with such period, prepared and attested by a responsible financial officer of Borrower as being complete and correct and fairly presenting Borrower's financial condition and the results of Borrower's operations. After a Qualified Public Offering, the foregoing interim financial statements shall be delivered no later than 45 days after each fiscal quarter and for the quarter-annual fiscal period then ended. (b) Year-End Financial Statements. As soon as available but no later than one hundred twenty (120) days after and as of the end of each financial reporting year, a complete copy of Borrower's audit report, which shall include balance sheet, income statement, statement of changes in equity and statement of cash flows for such year, prepared and certified by an independent certified public accountant selected by Borrower and satisfactory to Lender (the "Accountant"). The Accountant's certification shall not be qualified or limited due to a restricted or limited examination by the Accountant of any material portion of Borrower's records or otherwise. (c) Compliance Certificates. Simultaneously with the delivery of each set of financial statements referred to in paragraphs (a) and (b) above, a certificate of the chief financial officer of Borrower: (i) setting forth in reasonable detail any calculations required to establish an aging of Accounts, the amount of Eligible Accounts as of the date of such financial statements, and whether Borrower is in compliance with the requirements of Sections 2.9(b), 6.1, and 6.2; and (ii) stating whether any Default or Event of Default exists on the date of such certificate, and if so, setting forth the details thereof and the action which Borrower is taking or proposes to take with respect thereto. (d) Government Required Reports; Press Releases. Promptly after sending, issuing, making available, or filing, copies of all statements released to any news media for publication, all reports, proxy statements, and financial statements that Borrower sends or makes available to its stockholders, and, not later than five (5) days after actual filing or the date such filing was first due, all registration statements and reports that Borrower files or is required to file with the Securities and Exchange Commission, or any other governmental or regulatory authority. -15- (e) Other Information. Such other statements, lists of property and accounts, budgets, forecasts, reports, or other information as any Lender may reasonably from time to time request. 5.3 Managerial Assistance from Lender. Permit Lender, as a "venture capital operating company" to participate in, and influence the conduct of management of Borrower through the exercise of "management rights," as such terms are defined in 29 C.F.R. (S) 2510.3-101(d), by: (a) Permitting Lender to make available to Borrower, at no cost to Borrower, "significant managerial assistance", as defined in Section 2(a)(47) of the Investment Company Act of 1940, as amended, either in the form of: (i) consulting arrangements with Lender or any of its officers, directors, employees or affiliates, (ii) Borrower's allowing Lender to provide recommendations of prospective candidates for election to Borrower's Board of Directors, or (iii) Lender, at Borrower's request, seeking the services of third-party consultants to aid Borrower with respect to its management and operations; (b) Permitting Lender to make available consulting and advisory services to officers of Borrower regarding Borrower's equipment acquisition and financing plans, and such other matters affecting the business, financial condition and prospects of Borrower as Lender shall reasonably deem relevant; and (c) If Lender reasonably believes that financial or other developments affecting Borrower have impaired or are likely to impair Borrower's ability to perform its obligations under this Agreement, permitting Lender reasonable access to Borrower's management and/or Board of Directors and opportunity to present Lender's views with respect to such developments. 5.4 Existence. Maintain and preserve Borrower's existence, present form of business, and all rights and privileges necessary or desirable in the normal course of its business; and keep all Borrower's property in good working order and condition, ordinary wear and tear excepted. 5.5 Insurance. Maintain and keep in force insurance with an insurance carrier having a policyholder rating of not less than "A" and financial category rating of Class VII in "Best's Insurance Guide," unless otherwise approved by Lender and in such amounts and types as is usual in the business carried on by Borrower. Such insurance policies must be in form and substance satisfactory to Lender, and shall list Lender as an additional insured or loss payee, as applicable, on endorsements in form reasonably acceptable to Lender. Borrower shall furnish to Lender such endorsements, and upon Lender's request, copies of any or all such policies. 5.6 Accounting Records. Maintain adequate books, accounts and records, and prepare all financial statements in accordance with GAAP, and in compliance with the -16- regulations of any governmental or regulatory authority having jurisdiction over Borrower or Borrower's business; and permit employees or agents of Lender at such reasonable times as Lender may request, at Borrower's expense, to inspect Borrower's properties, and to examine, and make copies and memoranda of Borrower's books, accounts and records. 5.7 Compliance With Laws. Comply with all laws (including Environmental Laws), rules, regulations applicable to, and all orders and directives of any governmental or regulatory authority having jurisdiction over, Borrower or Borrower's business, and with all material agreements to which Borrower is a party, except where the failure to so comply would not have a Material Adverse Effect. 5.8 Taxes and Other Liabilities. Pay all Borrower's obligations when due; pay all taxes and other governmental or regulatory assessments before delinquency or before any penalty attaches thereto, except as may be contested in good faith by the appropriate procedures and for which Borrower shall maintain appropriate reserves; and timely file all required tax returns. 5.9 Use of Proceeds. Use the proceeds of Loans only as set forth in Article 2 of this Agreement; and not directly or indirectly to purchase or carry any margin stock, as defined from time to time by the Board of Governors of the Federal Reserve System in Federal Regulation U. ARTICLE 6 - NEGATIVE COVENANTS During the term of this Agreement and until the performance of all obligations to Lender, Borrower will not: 6.1 Indebtedness. Be indebted for borrowed money, the deferred purchase price of property, or leases which would be capitalized in accordance with GAAP; or become liable as a surety, guarantor, accommodation party or otherwise for or upon the obligation of any other Person, except: (a) Indebtedness incurred for the acquisition of supplies or inventory on normal trade credit; unsecured indebtedness for money borrowed for working capital or general corporate purposes from a commercial bank or institutional lender up to $500,000.00 in aggregate principal amount outstanding at any time; and other indebtedness incurred pursuant to one or more transactions permitted under Section 6.4; ----------- (b) Indebtedness not to exceed Two Hundred Fifty Thousand Dollars ($250,000) in aggregate principal amount outstanding at any time secured by purchase money security interests permitted by Section 6.2(c); -------------- (c) Indebtedness of Borrower under this Agreement; (d) Up to $750,000 of Indebtedness, singly or in the aggregate, in connection with one or more business acquisitions permitted hereunder; and -17- (e) Any Indebtedness approved by Lender prior to the Closing Date and disclosed on Schedule 6.1 to this Agreement. ------------ 6.2 Liens. Create, incur, assume or permit to exist any Lien, or grant any other Person a negative pledge, on any of Borrower's property, except Permitted Liens. Borrower and Lender agree that this covenant is not intended to constitute a lien, deed of trust, equitable mortgage, or security interest of any kind on any of Borrower's real property, and this Agreement shall not be recorded or recordable. Notwithstanding the foregoing, however, violation of this covenant by Borrower shall constitute an Event of Default. 6.3 Dividends. Except after a Qualified Public Offering, pay any dividends or purchase, redeem or otherwise acquire or make any other distribution with respect to any of Borrower's capital stock, except dividends or other distributions solely of capital stock of Borrower, and except for dividend rights of Summit Ventures III, L.P. under that certain Investor Rights Agreement dated as of October 14, 1994. 6.4 Changes/Mergers. Without the prior written consent of Lender (which consent shall not be unreasonably withheld and shall be deemed given if Lender shall have failed to notify Borrower of its withholding of consent for 30 or more days after Borrower's request therefor), liquidate or dissolve, or enter into any consolidation, merger, partnership, joint venture or other combination except for joint ventures, strategic alliances, licensing and similar - ------ arrangements customary in Borrower's industry for businesses in the development stage of Borrower and which do not require Borrower to assume or otherwise become liable for the obligations of any third party not directly related to or arising out of such arrangement or, without the prior written consent of Lender, require Borrower to transfer ownership of assets to such joint venture or other entity; prepay any subordinated debt, debt for borrowed money, or debt secured by any Permitted Lien, or enter into or modify any agreement as a result of which the terms of payment of any such debt are waived or modified. 6.5 Sales of Assets. Sell, transfer, lease or otherwise dispose of any of Borrower's assets except for fair consideration and in the ordinary course of its business; or enter into any sale or leaseback agreement covering any of Borrower's fixed or capital assets. 6.6 Loans/Investments. Make or suffer to exist any loans, guaranties, advances, or investments, except: (a) Accounts receivable in the ordinary course of Borrower's business; (b) Investments in domestic certificates of deposit issued by, and other domestic investments with, financial institutions organized under the laws of the United States or a state thereof, having one Hundred Million Dollars ($100,000,000) in capital and a rating of at least "investment grade" or "A" by Moody's or any successor rating agency;" -18- (c) Investments in marketable obligations of the United States of America and in open market commercial paper given the highest credit rating by a national credit agency and maturing not more than one year from the creation thereof; (d) Loans to a Person or guaranties of Indebtedness of a Person not to exceed Two Hundred Fifty Thousand Dollars ($250,000) for any one Person and One Million Dollars ($1,000,000) in aggregate with respect to all Persons, outstanding at any time; and (e) Temporary advances to cover incidental expenses to be incurred in the ordinary course of business. 6.7 Transactions With Related Persons. Directly or indirectly enter into any transaction with or for the benefit of a Related Person on terms more favorable to the Related Person than would have been obtainable in an "arms' length" dealing. 6.8 Other Business. Engage in any material line of business other than the business Borrower conducts as of the Closing Date. ARTICLE 7 - EVENTS OF DEFAULT 7.1 Events of Default. Upon the occurrence and during the continuation of any Default, the obligation of Lender to make any additional Loan shall be suspended. The occurrence of any of the following shall terminate any obligation of Lender to make any additional Loan; and shall, at the option of Lender (1) make all sums of Basic Interest, principal, Additional Interest and any other amounts owing under any Loan Documents immediately due and payable without notice of default, presentment or demand for payment, protest or notice of nonpayment or dishonor or any other notices or demands, and (2) give Lender the right to exercise any other right or remedy provided by contract or applicable law: (a) Borrower shall fail to make any payment or prepayment of principal or interest under this Agreement, or to pay any fees or other charges when due under any Loan Document, and such failure continues for three (3) Business Days or more after the same first becomes due; or an Event of Default as defined in any other Loan Document shall have occurred. (b) Any representation or warranty made, or financial statement, certificate or other document provided, by Borrower under any Loan Document shall prove to have been false or misleading in any material respect when made or deemed made herein. (c) Borrower shall fail to pay its debts generally as they become due or shall commence any Insolvency Proceeding with respect to itself; an involuntary Insolvency Proceeding shall be filed against Borrower, or a custodian, receiver, trustee, assignee for the benefit of creditors, or other similar official, shall be appointed to take possession, custody or control of the properties of Borrower, and such involuntary -19- Insolvency Proceeding, petition or appointment is acquiesced to by Borrower or is not dismissed within sixty (60) days; or the dissolution or termination of the business of Borrower. (d) Borrower shall be in default beyond any applicable period of grace or cure under any other agreement involving the borrowing of money, the purchase of property, the advance of credit or any other monetary liability of any kind to Lender or to any Person which results in the acceleration of payment of such obligation in an amount in excess of One Hundred Thousand Dollars ($100,000). (e) Any governmental or regulatory authority shall take any judicial or administrative action, or any defined benefit pension plan maintained by Borrower shall have any unfunded liabilities, any of which, in the reasonable judgment of Lender, might have a Material Adverse Effect. (f) Any judgment in excess of One Hundred Thousand Dollars ($100,000) shall be entered against Borrower which remain unsatisfied, unvacated or unstayed pending appeal for thirty (30) or more days after entry thereof. (g) Any Person or two or more Persons acting in concert shall have acquired beneficial ownership (within the meaning of Rule 13d-3 of the Securities and Exchange Commission) of forty percent (40%) or more of the outstanding shares of voting stock of Borrower. (h) Borrower shall fail to perform or observe any covenant contained in Article 6 of this Agreement. (i) Borrower shall fail to perform or observe any covenant contained in this Agreement or any other Loan Document (other than a covenant which is dealt with specifically elsewhere in this Article 7) and the breach of such covenant is not cured within 30 days after the sooner to occur of Borrower's receipt of notice of such breach from Lender or the date on which such breach first becomes known to any officer of Borrower; provided, however that if such breach is not capable of being cured within -------- ------- such 30-day period and Borrower timely notifies Lender of such fact and Borrower diligently pursues such cure, then the cure period shall be extended to the date requested in Borrower's notice but in no event more than 90 days from the initial breach; provided, further, that such -------- ------- additional 60-day opportunity to cure shall not apply in the case of any failure to perform or observe any covenant which has been the subject of a prior failure within the preceding 180 days or which is a willful and knowing breach by Borrower. ARTICLE 8 - GENERAL PROVISIONS 8.1 Notices. Any notice given by any party under any Loan Document shall be in writing and personally delivered, sent by overnight courier, or United States mail, postage prepaid, or sent by facsimile, to be promptly confirmed in writing, or other authenticated message, charges prepaid, to the other party's or parties' addresses shown on the signature pages -20- hereto. Each party may change the address or facsimile number to which notices, requests and other communications are to be sent by giving written notice of such change to each other party. Notice given hand delivery shall be deemed received on the date delivered; if sent by overnight courier, on the next business day after delivery to the courier service; if by first class mail, on the third business day after deposit in the U.S. Mail; and if by telecopy, on the date of transmission. 8.2 Binding Effect. The Loan Documents shall be binding upon and inure to the benefit of Borrower and Lender and their respective successors and assigns; provided, however, that Borrower may not assign or transfer Borrower's rights or obligations under any Loan Document without Lender's prior written consent. Lender reserves the right to sell, assign, transfer, negotiate or grant participations in all or any part of, or any interest in, Lender's rights and obligations under the Loan Documents. In connection with any of the foregoing, Lender may disclose all documents and information which Lender now or hereafter may have relating to the Loans, Borrower, or its business; provided that any person who receives such information shall have agreed in writing in advance to maintain the confidentiality of such information on terms reasonably acceptable to Borrower. 8.3 No Waiver. Any waiver, consent or approval by Lender of any Event of Default or breach of any provision, condition, or covenant of any Loan Document must be in writing and shall be effective only to the extent set forth in writing. No waiver of any breach or default shall be deemed a waiver of any later breach or default of the same or any other provision of any Loan Document. No failure or delay on the part of Lender in exercising any power, right, or privilege under any Loan Document shall operate as a waiver thereof, and no single or partial exercise of any such power, right, or privilege shall preclude any further exercise thereof or the exercise of any other power, right or privilege. Lender has the right at its sole option to continue to accept interest and/or principal payments due under the Loan Documents after default, and such acceptance shall not constitute a waiver of said default or an extension of the Maturity Date unless Lender agrees otherwise in writing. 8.4 Rights Cumulative. All rights and remedies existing under the Loan Documents are cumulative to, and not exclusive of, any other rights or remedies available under contract or applicable law. 8.5 Unenforceable Provisions. Any provision of any Loan Document executed by Borrower which is prohibited or unenforceable in any jurisdiction, shall be so only as to such jurisdiction and only to the extent of such prohibition or unenforceability, but all the remaining provisions of any such Loan Document shall remain valid and enforceable. 8.6 Accounting Terms. Except as otherwise provided in this Agreement, accounting terms and financial covenants and information shall be determined and prepared in accordance with GAAP. 8.7 Indemnification; Exculpation. Borrower shall pay and protect, defend and indemnify Lender and Lender's employees, officers, directors, shareholders, affiliates, correspondents, agents and representatives (other than Lender, collectively "Agents") against, -21- and hold Lender and each such Agent harmless from, all claims, actions, proceedings, liabilities, damages, losses, expenses (including, without limitation, attorneys' fees and costs) and other amounts incurred by Lender and each such Agent, arising from (i) the matters contemplated by this Agreement or any other Loan Documents or (ii) any contention that Borrower has failed to comply with any law, rule, regulation, order or directive applicable to Borrower's business; provided, however, that this indemnification shall not apply to any of the foregoing incurred solely as the result of Lender's or any Agent's gross negligence or willful misconduct. This indemnification shall survive the payment and satisfaction of all of Borrower's Obligations to Lender. 8.8 Reimbursement. Borrower shall reimburse Lender for all costs and expenses, including without limitation reasonable attorneys' fees and disbursements expended or incurred by Lender in any arbitration, mediation, judicial reference, legal action or otherwise in connection with (a) the preparation and negotiation of the Loan Documents, not to exceed $3,000.00, (b) the amendment, interpretation and enforcement of the Loan Documents, including without limitation during any workout, attempted workout, and/or in connection with the rendering of legal advice as to Lender's rights, remedies and obligations under the Loan Documents, (c) collecting any sum which becomes due Lender under any Loan Document, (d) any proceeding for declaratory relief, any counterclaim to any proceeding, or any appeal, or (e) the protection, preservation or enforcement of any rights of Lender. For the purposes of this section, attorneys' fees shall include, without limitation, fees incurred in connection with the following: (1) contempt proceedings; (2) discovery; (3) any motion, proceeding or other activity of any kind in connection with an Insolvency Proceeding; (4) garnishment, levy, and debtor and third party examinations; and (5) postjudgment motions and proceedings of any kind, including without limitation any activity taken to collect or enforce any judgment. All of the foregoing costs and expenses shall be payable upon demand by Lender, and if not paid within forty-five (45) days of presentation of invoices shall bear interest at the highest applicable Default Rate. 8.9 Execution in Counterparts. This Agreement may be executed in any number of counterparts which, when taken together, shall constitute but one agreement. 8.10 Entire Agreement. The Loan Documents are intended by the parties as the final expression of their agreement and therefore contain the entire agreement between the parties and supersede all prior understandings or agreements concerning the subject matter hereof. This Agreement may be amended only in a writing signed by Borrower and Lender. 8.11 Governing Law and Jurisdiction. (a) THIS AGREEMENT AND THE LOAN DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF CALIFORNIA. (b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA OR OF THE UNITED STATES -22- FOR THE NORTHERN, CENTRAL OR SOUTHERN DISTRICT OF CALIFORNIA, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF BORROWER AND LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF BORROWER AND LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. BORROWER AND LENDER EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY CALIFORNIA LAW. 8.12 Waiver of Jury Trial. BORROWER AND LENDER EACH WAIVES ITS RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. BORROWER AND LENDER EACH AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEMS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS. -23- IN WITNESS WHEREOF, Borrower and Lender have executed this Agreement as of the date set forth in the preamble. Addresses for Notices: COMPS INFOSYSTEMS, INC. - --------------------- COMPS InfoSystems, Inc. By: /s/ Christopher A. Crane 9888 Carroll Centre Road -------------------------- San Diego, CA 92126-4580 Christopher A. Crane, Attn: Christopher A. Crane, President and CEO President and CEO Fax No. 619-684-3292 Venture Lending & Leasing, Inc. VENTURE LENDING & LEASING, INC. 2010 North First Street, Suite 310 San Jose, CA 95131 By: /s/ Salvador O. Gutierrez Attn: Salvador 0. Gutierrez, President -------------------------- Fax No. 408-435-8625 Salvador O. Gutierrez, President -24- EXHIBIT "A" ----------- See Exhibit 10.12 and Exhibit 10.13 to the Registration Statement on Form S-1 EXHIBIT "B" Form of Borrowing Request ------------------------- _____________, 199___ Venture Lending & Leasing, Inc. 2010 North First Street, Suite 310 San Jose, CA 95131 Re: COMPS InfoSystems, Inc. ----------------------- Gentlemen: Reference is made to the Loan Agreement dated as of September 24, 1996 (as it has been and may be amended from time to time, the "Loan Agreement", the capitalized terms used herein as defined therein), between Venture Lending & Leasing, Inc. and COMPS InfoSystems, Inc. (the "Company"). The undersigned is the Chief Financial Officer of the Company, and hereby requests a Loan under the Loan Agreement, and in that connection certifies as follows: 1. The type of the proposed Loan is [the Term Loan/an Equipment Loan]. The amount of the proposed Loan is $____________. The Business Day of the proposed Loan is ___________, 199___. 2. As of this date, no Default or Event of Default has occurred and is continuing, or will result from the making of the proposed Loan, and the representations and warranties of the Company contained in Article 3 of the Loan Agreement are true and correct. 3. No Material Adverse Change has occurred since the date of the most recent financial statements submitted to you by the Company. 4. As of the date hereof, the aggregate amount of the Company's Eligible Accounts is $__________, 80% of which exceeds the outstanding principal balance of the Term Loan [or if the Term Loan balance exceeds 80% of Eligible Accounts, a prepayment of the Term Loan in the amount of such excess is made herewith]. The Company shall notify you promptly before the funding of the Loan if any of the matters to which I have certified above shall not be true and correct on the Borrowing Date. Very truly yours, ------------------------------- Chief Financial Officer EXHIBIT "C" See Exhibit 10.9 to the Registration Statement on Form S-1 EXHIBIT "D" See Exhibit 10.7 to Registration Statement on Form S-1 Schedule 3.6 ------------ Litigation ---------- Schedule 3.6 Arbitration ----------- COMPS InfoSystems, Inc. vs. Andrew Blount and DOES 1 - 20. San Diego Superior - --------------------------------------------------------- Court No. 00697714. This action was commenced on March 5, 1996. The complaint alleges that Andrew Blount, a former employee, has engaged in unfair competition, has misappropriated trade secrets, has intentionally interfered with contractual relations and prospective economic advantage of the Company, has breached his fiduciary duty, has violated Labor Code section 2860, and had breached a contract and the covenant of good faith and fair dealing with the Company. At the same time, the Company sought and obtained a temporary restraining order against Mr. Blount regarding his conduct, and later, sought and obtained a preliminary injunction. The defendant filed a counterclaim against the company, claiming defamation of character and unfair competition. The defendant's request for a preliminary injunction regarding these complaints was denied. Recently, the defendant's counsel has filed a petition to be relieved from representing the defendant. The petition has been filed because the defendant has breached his agreement with his attorney by failing to remit payment to him. The Court has ordered the matter into binding arbitration in accord with the arbitration agreement signed by the parties. The Company plans to seek a settlement payment from the defendant prior to arbitration. Failing this, the Company has already reserved in its projections sufficient monies to cover the arbitration expenses. In the Company's opinion, the outcome of the complaints should have no material effect on the Company or the Company's financial condition because, to date, the Court has looked favorably upon each of the Company's motions and issued injunctions against the defendant, while the court denied the injunction against the Company regarding the defendant's complaints. Schedule 6.1 ------------ Permitted Indebtedness ---------------------- Schedule 6.1 ------------ Permitted Indebtedness ---------------------- EQUIPMENT LEASES - ---------------- 1. Avnet/AT&T Capital Corporation Lease No. 424755 Term: 60 months Start: 10/25/94 Equipment: HP 9000 Computer Original Loan: $32,121.40 2. Canon Financial Service Lease No. 001-0050913-001 Term: 60 Months Start: 09/20/94 Equipment: 3 Canon Copiers Original Loan: $20,628.00 3. Canon Financial Service Lease No. 001-0058622-001 Term: 60 Months Start: 04/05/95 Equipment: 1 Canon Copier Original Loan: $7,824.00 4. Ford Motor Corp. Acct. No. FN A321 335R Term: 48 months Start: 01/26/94 Vehicle: FORD Escort 1993 Original Loan: $12,305.65 5. G.E. Capital Lease No. 6519146-001 Term: 60 Months Start: 5/16/94 Equipment: Executone Telephone Equipment Original Loan: $64,805.00 6. Orix USA Corporation Lease No. 33938 Term: 36 Months Start: 01/15/95 Equipment: Gupta Software Original Loan: $80,296.96 Schedule 6.1 ------------ Permitted Indebtedness ---------------------- 7. Sybase Financial Services, Inc. Agreement # 509662 Term: 36 months Start: 7/15/94 Equipment: Sybase Software Original Loan: $26,160.00 8. Sybase Financial Services, Inc. Agreement #515973 Term: 36 months Start: 10/21/94 Equipment: Sybase Software Original Loan: $29,255.00 9. Tokai Financial Lease No. 24150393 Term: 60 Months Start: 01/10/95 Equipment: Haworth Systems Furniture Original Loan: $111,576.68 10. Xerox Corporation Contract No. 958325383 Term: 24 months Start: 12/94 Equipment: Xerox 5090 Copier Original Loan: $12,780.00 11. Xerox Corporation Contract # 903429 Term: 24 months Start: 12/94 Equipment: Xerox 5065 Copier Original Loan: $6,957.00 12. Xerox Corporation Contract # 903395 Term: 24 months Start: 12/94 Equipment: Xerox 5065 Copier Original Loan: $6,957.00 Schedule 6.1 ------------ Permitted Indebtedness ---------------------- 13. Xerox Corporation Contract # 958903379 Term: 24 months Start: 12/94 Equipment: Xerox 5046 Copier Original Loan: $2,418.00 14. Xerox Corporation Contract # Not Available as of 9/30/96 Term: 72 months from start of contract Start: Quarter 4, 1996 Equipment: Xerox Docutech or 5390 Copier Original Loan: Not more than $300,000.00 NOTES PAYABLE - ------------- Notes Payable to Bank - --------------------- 1. Union Bank 7807 Girard Avenue La Jolla, CA 92037 Randall T. Vogan, Commercial Loan Officer a. Union Bank Note 002000001 Remaining Balance at 9/30/96: $ 3,432.61 b. Union Bank Note 002000002 Remaining Balance at 9/30/96: $ 20,536.18 c. Union Bank Note 002000003 Remaining Balance at 9/30/96: $ 13,135.11 2. Bank: Silicon Valley Bank 5414 Oberlin Drive San Diego, CA 92121 John W. Otterson, Vice President Facility up to $750,000.00 Note payable to TRW REDI under Purchase Agreement dated August 31, 1995 between COMPS InfoSystems, Inc. and TRW REDI Property Data. Total Note Payable to TRW REDI $750,000.00 Due in six annual installments of $125,000.00 Schedule 6.2 ------------ Permitted Liens --------------- Schedule 6.2 ------------ Permitted Liens ---------------
1. Secured Party: Avnet Leasing/AT&T Capital Corporation. Debtor: Business Real Estate Information Corp. Financing Statement: - Any and all financing statements and/or liens filed in any state. 2. Secured Party: Canon Financial Services Debtor: Business Real Estate Information Corp. Financing Statement: - Any and all financing statements and/or liens filed in any state. 3. Secured Party: Camadon, Inc. Debtor: COMPS InfoSystems, Inc. Financing Statement: - Any and all financing statements and/or liens filed in any state. 4. Secured Party: Ford Motor Corporation Debtor: Business Real Estate Information Corp. Financing Statement: - Any and all financing statements and/or liens filed in any state. 5. Secured Party: G.E. Capital Corporation Debtor: Business Real Estate Information Corp. Financing Statement: - Any and all financing statements and/or liens filed in any state. 6. Secured Party: ORIX USA Corporation Debtor: COMPS InfoSystems, Inc. Financing Statement: - File No. 9503460597 filed with California Secretary of State 7. Secured Party: Silicon Valley Bank Debtor: COMPS InfoSystems, Inc. Financing Statement: - Any present and all future financing statements and/or liens filed in any state. 8. Secured Party: Sybase Financial Services, Inc. Debtor: Business Real Estate Information Corp. Financing Statement: Any and all financing statements and/or liens filed in any state. 9. Secured Party: Master Lease Division of Tokai Financial Services, Inc. Debtor: COMPS InfoSystems, Inc. Financing Statement: - File No. 9510760241 filed with California Secretary of State
Schedule 6.2 ------------ Permitted Liens --------------- 10. Secured Party: TRW REDI Property Data Debtor: COMPS InfoSystems, Inc. Financing Statement: - Any present and all future financing statements and/or liens filed in any state. 11. Secured Party: Union Bank - La Jolla Office Debtor: Business Real Estate Information Corp. Financing Statement: - File No. 94145123, filed with California Secretary of State 12. Secured Party: Union Bank - La Jolla Office Debtor: Business Real Estate Information Corp. Financing Statement: - Any and all financing statements and/or liens filed in any state. 13. Secured Party: Union Bank - La Jolla Office Debtor: COMPS InfoSystems, Inc. Financing Statement: - Any and all financing statements and/or liens filed in any state. 14. Secured Party: Xerox Corporation Debtor: Business Real Estate Information Corp. Financing Statement: - Any and all financing statements and/or liens filed in any state. 15. Secured Party: Xerox Corporation Debtor: COMPS InfoSystems, Inc. Financing Statement: - Any present and all future financing statements and/or liens filed in any state.
EX-10.9 14 SECURITY AGREEMENT DATED 9/24/96 Exhibit 10.9 SECURITY AGREEMENT This Agreement is made as of September 24, 1996 by COMPS InfoSystems, Inc., a Delaware corporation ("Debtor"), in favor of Venture Lending & Leasing, Inc., a Maryland corporation ("Lender"). ARTICLE 1 - DEFINITIONS The following definitions shall be applicable to both the singular and plural forms of the defined terms: "Account" means a right to payment for goods sold or leased by Debtor or for services rendered by Debtor, which right is not evidenced by an instrument or chattel paper, whether or not earned by performance. "Agreement" means this Security Agreement, as it may be amended from time to time. "Collateral" means all Debtor's Accounts, Deposit Accounts, Equipment, Fixtures, General Intangibles, Goods, Inventory, Rights to Payment, and securities now owned or hereafter acquired, wherever located, and whether held by Debtor or any third party, and all royalties, proceeds and products thereof, including all insurance and condemnation proceeds ("Proceeds"), and all Records. "Deposit Accounts" means all Debtor's demand, time, savings, passbook or similar accounts maintained with a financial institution or credit union. "Equipment" means all of Debtor's equipment now owned or hereafter acquired, including but not limited to machinery, machine parts, furniture, furnishings and all tangible personal property used in the business of Debtor and all such property which is or is to become fixtures on real property, and all improvements, replacements, accessions and additions thereto, wherever located, and all proceeds thereof arising from the sale, lease, rental or other use or disposition of any such property, including all rights to payment with respect to insurance or condemnation, returned premiums, or any cause of action relating to any of the foregoing. "Event of Default" means an event described in Article 6. "Fixtures" means all items of personal property of Debtor that are so related to the real property upon which they are located that an interest in them arises under real property law, and improvements, replacements, parts, accessions and additions thereto, and substitutions therefor. "General Intangibles" means all personal property of Debtor, other than Goods, not otherwise defined as Collateral, including without limitation all interests or claims in insurance policies; literary property; tradenames, tradename rights; Trademarks, Trademark rights, copyrights, Patents, and all applications therefor; licenses, permits, franchises and like privileges or rights issued by any governmental or regulatory authority; income tax refunds; customer lists; claims and causes of action (whether in contract, tort or otherwise), judgments and all guaranty claims, leasehold interests in personal property, security interests or other security held by or guaranteed to the Debtor to secure the payment by an account debtor of any of the Accounts. "Goods" means all money and other personal property of Debtor, other than General Intangibles, not otherwise defined as Collateral. "Indebtedness" means all debts, obligations and liabilities of Debtor to Lender currently existing or now or hereafter made, incurred or created under, pursuant to or in connection with the Loan Agreement, whether voluntary or involuntary and however arising or evidenced, whether direct or acquired by Lender by assignment or succession, whether due or not due, absolute or contingent, liquidated or unliquidated, determined or undetermined, and whether Debtor may be liable individually or jointly, or whether recovery upon such debt may be or become barred by any statute of limitations or otherwise unenforceable; and all renewals, extensions and modifications thereof; and all attorneys' fees and costs incurred by Lender in connection with the collection and enforcement thereof as provided for in any Loan Document. "Inventory" means all Debtor's raw materials, advertising, packaging and shipping materials, work in process, finished goods and goods held for sale or lease or furnished under contracts of service, and all returned and repossessed goods, and all goods covered by documents of title, including warehouse receipts, bills of lading and all other documents of every type covering all or any part of the Collateral. "Lien" means any voluntary or involuntary security interest, mortgage, pledge, claim, charge, encumbrance, title retention agreement, or third party interest covering all or any part of the property of Debtor or any other Person. "Loan Agreement" means that certain Loan Agreement between Debtor and Lender of even date herewith, as amended from time to time. "Loan Documents" means this Agreement, the Loan Agreement, any evidence of Indebtedness, any guaranty, security or pledge agreement, or deed of trust delivered in connection with any Indebtedness, and all other contracts, instruments, addenda and documents executed in connection therewith. "Patent License" means any written agreement now or hereafter in existence granting to Debtor any right to make, use, sell or practice any invention on which a Patent is in existence, including, without limitation, the agreements described in Schedule 1 to Exhibit A hereto. ---------- --------- "Patents" means all of the following: (i) all letters patent of the United States or any other country, all registrations and recordings thereof, and all applications for letters patent of the United States or any other country, including, without limitation, registrations, recordings and applications in the United States Patent and Trademark Office or in any similar office or agency of the United States, any state thereof or any other country or any political subdivision thereof, including, without limitation, those referred to in Schedule 1 to Exhibit A hereto, and (ii) all reissues, divisions, ---------- --------- continuations, continuations-in-part, renewals or extensions thereof. 2 "Patent Collateral Assignment" means the Patent Collateral Assignment executed and delivered by Debtor in favor of Lender, substantially in the form of Exhibit A, as the same may be amended from time to time. --------- "Permitted Liens" is defined in the Loan Agreement. "Person" means any individual or entity. "Records" means all Debtor's computer programs, software, hardware, source codes and data processing information, all written documents, books, invoices, ledger sheets, financial information and statements, and all other writings concerning Debtor's business. "Rights to Payment" means all Debtor's accounts, instruments, contract rights, documents, chattel paper and all other rights to payment, including, without limitation, the Accounts, all negotiable certificates of deposit and all rights to payment under any Patent License, any Trademark License, or any commercial or standby letter of credit. "Trademark License" means any written agreement now or hereafter in existence granting to Debtor any right to use any Trademark, including, without limitation, the agreements described in Schedule 1 to Exhibit B hereto. ---------- --------- "Trademarks" means all of the following: (i) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service marks, logos, other source or business identifiers, prints and labels on which any of the foregoing have appeared or will appear, designs and general intangibles of like nature, now existing or hereafter adopted or acquired, all registrations and recordings thereof, and all applications in connection therewith, including, without limitation, registrations, recordings and applications in the United States Patent and Trademark Office or in any similar office or agency of the United States, any state thereof or any other country or any political subdivision thereof, including, without limitation, those described in Schedule 1 to Exhibit B ---------- --------- hereto, and (ii) all reissues, divisions, continuations, continuations-in-part, renewals or extensions thereof. "Trademark Collateral Assignment" means the Trademark Collateral Assignment executed and delivered by Debtor in favor of Lender, substantially in the form of Exhibit B hereto, as the same may be amended from time to time. --------- "Uniform Commercial Code" means the California Uniform Commercial Code, as amended from time to time. Terms not specifically defined in this Agreement have the meanings ascribed thereto in the Loan Agreement and the Uniform Commercial Code. ARTICLE 2 - GRANT OF SECURITY INTEREST To secure the timely payment of the Indebtedness and performance of all obligations of Debtor to Lender, Debtor grants to Lender security interests in the Collateral. 3 ARTICLE 3 - REPRESENTATIONS AND WARRANTIES Debtor represents and warrants that, at all times during the term of this Agreement: 3.1 Governmental Actions. Debtor has obtained all consents and actions of, and has performed all filings with, any governmental or regulatory authority that are required to authorize the execution, delivery or performance of this Agreement or the granting or perfecting of Lender's security interest in the Collateral. 3.2 Title. Except for the security interests created by this Agreement, and Permitted Liens, (i) Debtor is and will be the unconditional legal and beneficial owner of the Collateral, and (ii) the-Collateral is genuine and subject to no Liens, rights or defenses of others. There exist no prior assignments or encumbrances of record with the U.S. Patent and Trademark Office affecting any Collateral in favor of any third party other than Lender. 3.3 Rights to Payment. The names of the obligors, amount owing to Debtor, due dates and all other information with respect to the Rights to Payment are and will be correctly stated in all material respects in all Records relating to the Rights to Payment. Debtor further represents and warrants, to its knowledge, that each Person appearing to be obligated on a Right to Payment has authority and capacity to contract and is bound as it appears to be. 3.4 Chief Executive Office. Debtor's chief executive office is located at:
Address City County State Zip ------- ---- ------ ----- --- 9888 Carroll Centre Road, San Diego San Diego CA 92126
3.5 Inventory Location. Other than as set forth in Section 3.4, Inventory is located at:
Address City County State Zip -------- ---- ------ ----- --- Same as paragraph 3.4
3.6 Records Location. Other than as set forth in Section 3.4, Records are maintained at:
Address City County State Zip -------- ---- ------ ----- --- Same as paragraph 3.4
4 3.7 Equipment or Fixtures Location. Other than as set forth in Section 3.4, Equipment or Fixtures are located at:
Address City County State Zip -------- ---- ------ ----- --- See Schedule 3.7
3.8 Other Places of Business. In addition to the locations set forth in Sections 3.4 through 3.7, Debtor maintains the following place(s) of business:
Address City County State Zip -------- ---- ------ ----- --- None
3.9 Business Names. Debtor has conducted business in the following names other than the name stated in the preamble to this Agreement: LSR/COMPS Business Real Estate Information Co. Commercial Property Information Services ARTICLE 4 - AFFIRMATIVE COVENANTS During the term of this Agreement and until payment of all the Indebtedness and performance of all obligations to Lender, Debtor will: 4.1 Delivery of Certain Items. Deliver to Lender promptly (a) upon Lender's request, duplicate invoices with respect to each Account bearing such language of assignment as Lender shall reasonably specify; (b) the originals of all commercial and standby letters of credit, instruments, documents and chattel paper constituting Collateral, endorsed and assigned as Lender shall reasonably specify; (c) after an Event of Default, all Proceeds; (d) upon Lender's request, returned property resulting from, or payment equal to any allowance or credit on, Rights to Payment; (e) such specific acknowledgments, assignments or other agreements as Lender may reasonably request relating to the Collateral; and (f) such Records and other reports in such form and detail and at such times as Lender may reasonably require relating to the Collateral, including without limitation reports of acquisition, and disposition, agings, and collection of any Collateral. if any of the Rights to Payment become evidenced by an instrument, Debtor will notify Lender thereof and, upon request by Lender promptly deliver such instrument to Lender appropriately endorsed to the order of Lender as further security for the satisfaction in full of the Indebtedness. 4.2 Maintenance of Collateral; Inspection. Do all things reasonably necessary to maintain, preserve, protect and keep all Collateral in good working order and salable condition, ordinary wear and tear excepted, deal with the Collateral in all ways as are 5 considered good practice by owners of like property, and use the Collateral lawfully and, to the extent applicable, only as permitted by Debtor's insurance policies. Upon reasonable prior notice at reasonable times during normal business hours, Debtor hereby authorizes Lender's officers, employees, representatives and agents to inspect the Collateral and to discuss the Collateral and the Records relating thereto with Debtors, officers and employees, and, in the case of any Right to Payment, with any Person which is or may be obligated thereon. 4.3 Maintenance of Records; Inspection. maintain, or cause to be maintained, complete and accurate Records relating to the Collateral. Upon reasonable prior notice at reasonable times during normal business hours, Lender, its officers, employees, agents and representatives shall have the right, from time to time, to examine the Records and to make copies or extracts therefrom. 4.4 Debtor's Duty to Give Notice. Give prompt notice to Lender of: (a) except as permitted in Section 5.5, any material discount, credit, rebate or other reduction in the amount owing on a material Right to Payment; (b) any threatened or asserted dispute, setoff, claim, counterclaim or defense with respect to a Right to Payment; (c) any material decrease in the value of any Collateral and the amount of such decrease (other than depreciation calculated in the ordinary course of business under applicable tax laws and regulations and in accordance with generally accepted accounting principles); (d) any litigation or administrative or regulatory proceeding which may have a material adverse effect on Debtor or its business; (e) to the extent Debtor has actual knowledge thereof, any change in the ownership of any property on which Debtor's chief executive office is located; and (f) the occurrence of any Default or Event of Default or of any other development, financial or otherwise, which might materially adversely affect the Collateral or Debtor's ability to pay the Indebtedness or perform its obligations to Lender. Debtor shall notify Lender immediately if it has actual knowledge that any application or registration relating to any Patent or Trademark may become abandoned or dedicated, or of any adverse determination or development (including, without limitation, the institution of, or any such determination or development in, any proceeding in the United States Patent and Trademark Office or any court) regarding Debtor's ownership of any Patent or Trademark, its right to register the same, or to keep and maintain the same. In the event that any Patent, Patent License, Trademark or Trademark License is infringed, misappropriated or diluted by a third party, Debtor shall notify Lender promptly after it learns thereof and shall, unless Debtor shall reasonably determine that any such action would not be of reasonable economic value, promptly sue for infringement, misappropriation or dilution and to recover any and all damages for such infringement, misappropriation or dilution, and take such other actions as Debtor shall reasonably deem appropriate under the circumstances to protect such Patent, Patent License, Trademark or Trademark License. 4.5 Financing Statements and Other Actions. Execute and deliver to Lender, and file or record at Debtor's expense, all financing statements, notices and other documents (including, without limitation, any filings with the United States Patent and Trademark Office) from time to time reasonably requested by any Lender to maintain a first perfected security interest in the Collateral in favor of Lender, all in form and substance satisfactory to Lender; perform such other acts, and execute and deliver to Lender such additional conveyances, assignments, agreements and instruments, as Lender may at any time 6 request in connection with the administration and enforcement of this Agreement or Lender's rights, powers and remedies hereunder. ARTICLE 5 - NEGATIVE COVENANTS During the term of this Agreement and until payment of all the Indebtedness and performance of all obligations to Lender, Debtor will not: 5.1 Liens. Create, incur, assume or permit to exist any Lien or grant any other Person a negative pledge on any Collateral, except Permitted Liens. 5.2 Documents of Title. Sign or authorize the signing of any financing statement or other document naming Debtor as debtor or obligor, or acquiesce or cooperate in the issuance of any bill of lading, warehouse receipt or other document or instrument of title with respect to any Collateral, except those negotiated to Lender, or those naming Lender as secured party, or those permitted under Section 6.2 of the Loan Agreement. ----------- 5.3 Disposition of Collateral. Sell, transfer, lease or otherwise dispose of any Collateral except for fair consideration and in the ordinary course of its business. 5.4 Change in Location or Name. Without at least 30 days' prior written notice to Lender: (a) Maintain Records, its chief executive office, or a place of business at a location other than as specified in Article 3; or (b) change its name or mailing address. 5.5 Certain Agreements on Rights to Payment. Other than in the ordinary course of business, make or arrange to make any material discount, credit, rebate or other reduction in the original amount owing on a Right to Payment or accept in satisfaction of a Right to Payment less than the original amount thereof, except as disclosed to Lender in writing from time to time. ARTICLE 6 - EVENTS OF DEFAULT 6.1 Event of Default. The occurrence of any "Event of Default" as defined in the Loan Agreement. 6.2 Acceleration and Remedies. Upon the occurrence and during the continuance of an Event of Default, Lender shall be entitled to, at its option, (a) declare all or any part of the Indebtedness immediately due and payable; (b) exercise any or all of the rights and remedies available to a secured party under the Uniform Commercial Code or any other applicable law; and (c) exercise any or all of its rights and remedies provided for in this Agreement and in any other Loan Document. The obligations of Debtor under this Agreement shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any Indebtedness is rescinded or must otherwise be returned by Lender upon, on account of, or in connection with, the insolvency, bankruptcy or reorganization of Debtor or otherwise, all as though such payment had not been made. 6.3 Sale of Collateral. Upon the occurrence and during the continuance of an Event of Default, Lender may sell all or any part of the Collateral, at public or private sales, to 7 itself, a wholesaler, retailer or investor, for cash, upon credit or for future delivery, and at such price or prices as Lender may deem commercially reasonable. To the extent permitted by law, Debtor hereby specifically waives all rights of redemption and any rights of stay or appraisal which it has or may have under any applicable law in effect from time to time. Any such public or private sales shall be held at such times and at such place(s) as Lender may determine. In case of the sale of all or any part of the Collateral on credit or for future delivery, the Collateral so sold may be retained by Lender until the selling price is paid by the purchaser, but Lender shall not incur any liability in case of the failure of such purchaser to pay for the Collateral and, in case of any such failure, such Collateral may be resold. Lender may, instead of exercising its power of sale, proceed to enforce its security interest in the Collateral by seeking a judgment or decree of a court of competent jurisdiction. Without limiting the generality of the foregoing, if an Event of Default is in effect, (1) Subject to the rights of any third parties, Lender may license, or sublicense, whether general, special or otherwise, and whether on an exclusive or non-exclusive basis, any Patents or Trademarks included in the Collateral throughout the world for such term or terms, on such conditions and in such manner as Lender shall in its sole discretion determine; (2) Lender may (without assuming any obligations or liability thereunder), at any time and from time to time, enforce (and shall have the exclusive right to enforce) against any licensee or sublicensee all rights and remedies of Debtor in, to and under any Patent Licenses or Trademark Licenses and take or refrain from taking any action under any thereof, and Debtor hereby releases Lender from, and agrees to hold Lender free and harmless from and against any claims arising out of, any lawful action so taken or omitted to be taken with respect thereto other than claims arising out of Lender's gross negligence or willful misconduct; and (3) upon request by Lender, Debtor will execute and deliver to Lender a power of attorney, in form and substance reasonably satisfactory to Lender for the implementation of any lease, assignment, license, sublicense, grant of option, sale or other disposition of a Patent or Trademark. In the event of any such disposition pursuant to this clause 3, -------- Debtor shall supply its know-how and expertise relating to the products or services made or rendered in connection with Patents, the manufacture and sale of the products bearing Trademarks, and its customer lists and other records relating to such Patents or Trademarks and to the distribution of said products, to Lender. 6.4 Debtor's Obligations Upon Default. Upon the request of Lender after the occurrence and during the continuance of an Event of Default, Debtor will: (a) Assemble and make available to Lender the Collateral at such place(s) as Lender shall reasonably designate, segregating all Collateral so that each item is capable of identification; and (b) Subject to the rights of any lessor, permit Lender, by Lender's officers, employees, agents and representatives, to enter any premises where any Collateral is located, to take possession of the Collateral, to complete the processing, 8 manufacture or repair of any Collateral, and to remove the Collateral, or to conduct any public or private sale of the Collateral, all without any liability of Lender for rent or other compensation for the use of Debtor's premises. ARTICLE 7 - SPECIAL COLLATERAL PROVISIONS 7.1 Compromise and Collection. Debtor and Lender recognize that setoffs, counterclaims, defenses and other claims may be asserted by obligors with respect to certain of the Rights to Payment; that certain of the Rights to Payment may be or become uncollectible in whole or in part; and that the expense and probability of success of litigating a disputed Right to Payment may exceed the amount that reasonably may be expected to be recovered with respect to such Right to Payment. Debtor hereby authorizes Lender, after and during the continuance of an Event of Default, to compromise with the obligor, accept in full payment of any Right to Payment such amount as Lender shall negotiate with the obligor, or abandon any Right to Payment. Any such action by Lender shall be considered commercially reasonable so long as Lender acts in good faith based on information known to it at the time it takes any such action. 7.2 Performance of Debtor's obligations. Upon the occurrence and during the continuance of an Event of Default, without having any obligation to do so, upon reasonable prior notice to Debtor, Lender may perform or pay any obligation which Debtor has agreed to perform or pay under this Agreement, including, without limitation, the payment or discharge of taxes or Liens levied or placed on or threatened against the Collateral. In so performing or paying, Lender shall determine the action to be taken and the amount necessary to discharge such obligations. Debtor shall reimburse Lender on demand for any amounts paid by Lender pursuant to this Section, which amounts shall constitute Indebtedness secured by the Collateral. 7.3 Power of Attorney. For the purpose of protecting and preserving the Collateral and Lender's rights under this Agreement, Debtor hereby irrevocably appoints Lender, with full power of substitution, as its attorney- in-fact with full power and authority, after the occurrence and during the continuance of an Event of Default, to do any act which Debtor is obligated to do hereunder; to exercise such rights with respect to the Collateral as Debtor might exercise; to use such Inventory, Equipment, Fixtures or other property as Debtor might use; to enter Debtor's premises; to give notice of Lender's security interest in, and to collect the Collateral; and to execute and file in Debtor's name any financing statements, amendments and continuation statements necessary or desirable to perfect or continue the perfection of Lender's security interests in the Collateral. Debtor hereby ratifies all that Lender shall lawfully do or cause to be done by virtue of this appointment. 7.4 Authorization for Lender to Take Certain Action. The power of attorney created in Section 7.3 is a power coupled with an interest and shall be irrevocable. The powers conferred on Lender hereunder are solely to protect its interests in the Collateral and shall not impose any duty upon Lender to exercise such powers. Lender shall be accountable only for amounts that it actually receives as a result of the exercise of such powers and in no event shall Lender or any of its directors, officers, employees, agents or representatives be responsible to Debtor for any act or failure to act, except for gross negligence or willful misconduct. After the occurrence and during the continuance of an Event of Default, Lender may exercise this power of attorney without notice to or assent of Debtor, in the name of Debtor, 9 or in Lender's own name, from time to time in Lender's sole discretion and at Debtor's expense. To further carry out the terms of this Agreement, after the occurrence and during the continuance of an Event of Default, Lender may: (a) Execute any statements or documents or take possession of, and endorse and collect and receive delivery or payment of, any checks, drafts, notes, acceptances or other instruments and documents constituting Collateral, or constituting the payment of amounts due and to become due or any performance to be rendered with respect to the Collateral. (b) Sign and endorse any invoices, freight or express bills, bills of lading, storage or warehouse receipts; drafts, certificates and statements under any commercial or standby letter of credit relating to Collateral; assignments, verifications and notices in connection with Accounts; or any other documents relating to the Collateral, including without limitation the Records. (c) Use or operate Collateral or any other property of Debtor for the purpose of preserving or liquidating Collateral. (d) File any claim or take any other action or proceeding in any court of law or equity or as otherwise deemed appropriate by Lender for the purpose of collecting any and all monies due or securing any performance to be rendered with respect to the Collateral. (e) Commence, prosecute or defend any suits, actions or proceedings or as otherwise deemed appropriate by Lender for the purpose of protecting or collecting the Collateral. In furtherance of this right, upon the occurrence and during the continuance of an Event of Default, Lender may apply for the appointment of a receiver or similar official to operate Debtor's business. (f) Prepare, adjust, execute, deliver and receive payment under insurance claims, and collect and receive payment of and endorse any instrument in payment of loss or returned premiums or any other insurance refund or return, and apply such amounts at Lender's sole discretion, toward repayment of the Indebtedness or replacement of the Collateral. 7.5 Application of Proceeds. Any Proceeds and other monies or property received by Lender pursuant to the terms of this Agreement or any Loan Document may be applied by Lender first to the payment of expenses of collection, including without limitation reasonable attorneys' fees, and then to the payment of the Indebtedness in such order of application as Lender may elect. 7.6 Deficiency. If the Proceeds of any disposition of the Collateral are insufficient to cover all costs and expenses of such sale and the payment in full of all the Indebtedness, plus all other sums required to be expended or distributed by Lender, then Debtor shall be liable for any such deficiency. 10 7.7 Lender Transfer. Upon the transfer of all or any part of the Indebtedness, Lender may transfer all or part of the Collateral and shall be fully discharged thereafter from all liability and responsibility with respect to such Collateral so transferred, and the transferee shall be vested with all the rights and powers of Lender hereunder with respect to such Collateral so transferred, but with respect to any Collateral not so transferred, Lender shall retain all rights and powers hereby given. 7.8 Lender's Duties. (a) Lender shall use reasonable care in the custody and preservation of any Collateral in its possession. Without limitation on other conduct which may be considered the exercise of reasonable care, Lender shall be deemed to have exercised reasonable care in the custody and preservation of such Collateral if such Collateral is accorded treatment substantially equal to that which Lender accords its own property, it being understood that Lender shall not have any responsibility for ascertaining or taking action with respect to calls, conversions, exchanges, maturities, declining value, tenders or other matters relative to any Collateral, regardless of whether Lender has or is deemed to have knowledge of such matters; or taking any necessary steps to preserve any rights against any Person with respect to any Collateral. Under no circumstances shall Lender be responsible for any injury or loss to the Collateral, or any part thereof, arising from any cause beyond the reasonable control of Lender. (b) Lender may at any time deliver the Collateral or any part thereof to Debtor and the receipt of Debtor shall be a complete and full acquittance for the Collateral so delivered, and Lender shall thereafter be discharged from any liability or responsibility therefor. (c) Neither Lender, nor any of its directors, officers, employees, agents, attorneys or any other person affiliated with or representing Lender shall be liable for any claims, demands, losses or damages, of any kind whatsoever, made, claimed, incurred or suffered by Debtor or any other party through the ordinary negligence of Lender, or any of its directors, officers, employees, agents, attorneys or any other person affiliated with or representing Lender. ARTICLE 8 - GENERAL PROVISIONS 8.1 Notices. Any notice given by any party under this Agreement or any Loan Document shall be in writing and personally delivered, deposited in the United States mail, postage prepaid, or sent by overnight courier, or by facsimile or other authenticated message, charges prepaid, and addressed as follows: 11 To Debtor: To Lender: - ---------- ---------- COMPS InfoSystems, Inc Venture Lending & Leasing, Inc. 9888 Carroll Centre Road 2010 North First Street, Suite 310 San Diego, CA 92126-4580 San Jose, CA 95131 Attn: Christopher A. Crane Attn: Salvador O. Gutierrez President and CEO President FAX No. 619-684-3292 FAX No. 408-436-8625 Notice given hand delivery shall be deemed received on the date delivered; if sent by overnight courier, on the next business day after delivery to the courier service; if by first class mail, on the third business day after deposit in the U.S. Mail; and if by telecopy, on the date of transmission. Each party may change the address to which notices, requests and other communications are to be sent by giving written notice of such change to each other party. 8.2 Binding Effect. This Agreement shall be binding upon Debtor, its permitted successors, representatives and assigns, and shall inure to the benefit of Lender and its successors and assigns. 8.3 Rights Cumulative. All rights and remedies existing under this Agreement are cumulative to, and not exclusive of, any other rights or remedies available under contract or applicable law. 8.4 Unenforceable Provisions. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall be so only as to such jurisdiction and only to the extent of such prohibition or unenforceability, but all the remaining provisions of this Agreement shall remain valid and enforceable. 8.5 Governing Law. Except as may be otherwise provided by the Uniform Commercial Code, this Agreement shall be governed by and construed in accordance with the laws of the State of California. 8.6 Termination. Subject to Section 6.2 of this Agreement and except ----------- as otherwise provided in Section 2.11 of the Loan Agreement, upon the payment in full of the Indebtedness and if Lender has no further obligations under its Commitment, the security interest granted hereby shall terminate and all rights to the Collateral shall revert to Debtor. Upon any such termination, the Lender shall, at Debtor's expense, execute and deliver to Debtor such documents as Debtor shall reasonably request to evidence such termination. 8.7 Entire Agreement. This Agreement, together with the Loan Agreement, Trademark Collateral Assignment, and Patent Collateral Assignment executed contemporaneously herewith covering certain Collateral, is intended by Debtor and Lender as the final expression of Debtor's obligations to Lender in connection with the Collateral and supersedes all prior understandings or agreements concerning the subject matter hereof. This Agreement may be amended only by a writing signed by Debtor and accepted by Lender in writing. IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set forth in the preamble. COMPS InfoSystems, Inc. By: /s/ Christopher A. Crane --------------------------- Name: Christopher A. Crane Title: President and CEO Venture Lending & Leasing, Inc. By: /s/ Salvador O. Gutierrez --------------------------- Name: Salvador O. Gutierrez Title: President 13 SCHEDULE 3.7 3.7 Equipment or Fixtures Location. Other than as set forth in Section 3.4 of the Security Agreement, Equipment or Fixtures are located at:
Address City County State Zip - -------------------------------- ---------------- ------------------ ----------------- ---------- 11630 Pleasant Hill Road Duluth Gwinnett Georgia 30136 176 Milk Street, #452 Boston Suffolk Massachussetts 02109 870 Mitten Road Burlingame San Mateo California 94010 622 Executive Drive Willowbrook DuPage Illinois 60521 5060 North 40th Street, Ste. 106 Phoenix Maricopa AZ 85018 8500 Leesburg Pike, Ste. 7700 Vienna Fairfax VA 22182
Exhibit A to Security Agreement ------------------ PATENT COLLATERAL ASSIGNMENT ---------------------------- See Exhibit 10.11 to Registration Statement on Form S-1 Exhibit B to Security Agreement ------------------ TRADEMARK COLLATERAL ASSIGNMENT ------------------------------- See Exhibit 10.10 to Registration Statement on Form S-1 EX-10.10 15 TRADEMARK COLLATERAL ASSIGNMENT DATED 9/24/96 Exhibit 10.10 TRADEMARK COLLATERAL ASSIGNMENT ------------------------------- THIS AGREEMENT is made on the 24th day of September, 1996, between COMPS InfoSystems, Inc., a Delaware corporation, having a mailing address at 9888 Carroll Centre Road, San Diego, CA 92126-4580 ("Assignor"), and Venture Lending & Leasing, Inc., ("Assignee"). Assignee's address is 2010 North First Street, Suite 310, San Jose, California 95131. RECITALS -------- A. Assignor owns the Trademarks, Trademark registrations and Trademark applications listed on Schedule 1 hereto, and is a party to the Trademark ---------- Licenses listed on Schedule 1 hereto: ---------- B. Assignor and Assignee are parties to a Loan Agreement of even date herewith (as the same may be amended from time to time, the "Loan Agreement"); C. Pursuant to the terms of the Security Agreement of even date herewith (as the same may be amended from time to time, the "Security Agreement"), by Assignor in favor of Assignee, Assignor has granted to Assignee a security interest in certain personal property assets of Assignor, including all right, title and interest of Assignor in, to and under all Debtor's Trademarks (as defined in the Security Agreement), Trademark registrations, Trademark applications and Trademark Licenses (as defined in the Security Agreement), whether presently existing or hereafter arising or acquired, together with the goodwill of the business symbolized by the Trademarks and the applications therefor and the registrations thereof, and all products and proceeds thereof, including, without limitation, any and all causes of action which may exist by reason of infringement or dilution thereof or injury to the associated goodwill, to secure the payment of all amounts owing under the Loan Agreement. D. Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Loan Agreement and the Security Agreement. NOW, THEREFORE, in consideration of the premises, Assignor hereby agrees with Assignee as follows: 1. To secure the complete and timely satisfaction of all Indebtedness (as defined in the Loan Agreement), Assignor hereby grants, assigns and conveys to Assignee a continuing security interest in and lien on all of Assignor's right, title and interest in and to the Trademarks, Trademark applications and Trademark Licenses listed on Schedule 1 hereto (as the same may be amended ---------- pursuant hereto from time to time), including, without limitation, all renewals thereof, all proceeds of infringement suits, the right to sue for past, present and future infringements and all rights corresponding thereto throughout the world (all of the foregoing are collectively called the "Trademarks"), and the goodwill of the business to which each of the Trademarks relates. 2. Assignor covenants and warrants that: (a) The Trademarks are subsisting and have not been adjudged invalid or unenforceable; (b) To the best of Assignor's knowledge, each of the Trademarks is valid and enforceable; (c) No claim has been made that the use of any of the Trademarks does or may violate the rights of any third person; (d) Assignor is the sole and exclusive owner of the entire and unencumbered right, title and interest in and to each of the Trademarks, free and clear of any liens, charges and encumbrances, including, without limitation, pledges, assignments, licenses, registered user agreements and covenants by Assignor not to sue third persons, except (i) Permitted indebtedness; and (ii) any license disclosed in Schedule 1; ---------- (e) Assignor has the unqualified right to enter into this Agreement and perform its terms; (f) Assignor has used, and will continue to use for the duration of this Agreement, proper statutory notice in connection with its use of the Trademarks; and (g) Assignor has used, and will continue to use for the duration of this Agreement, consistent standards of quality in its manufacture of products sold under the Trademarks. 3. Assignor hereby grants to Assignee and its employees and Assignee the right to visit Assignor's plants and facilities which manufacture, inspect or store products sold under any of the Trademarks, and to inspect the products and quality control records relating thereto at reasonable times during regular business hours. Assignor shall do any and all acts required by Assignee to ensure Assignor's compliance with paragraph 2(g). 4. Assignor agrees that, until all of the Indebtedness shall have been satisfied in full, it will not enter into any agreement (for example, a license agreement) which is inconsistent with Assignor's obligations under this Agreement, without Assignee's prior written consent; provided, that so long as -------- no Default or Event of Default (as defined in the Loan Agreement) shall have occurred and be continuing, Assignor may grant licenses to third parties to use the Trademarks in the ordinary course of business of both Assignor and such third party on arm's length and customary business terms. 5. If, before the Indebtedness shall have been satisfied in full, Assignor shall obtain rights to any new Trademarks, the provisions of paragraph 1 shall automatically apply thereto and Assignor shall give Assignee prompt written notice thereof. 6. Assignor authorizes Assignee unilaterally to modify this Agreement by amending Schedule 1 to include any future Trademarks and Trademark ---------- applications covered by paragraphs 1 and 5 hereof. 2 7. If any Event of Default (as defined in the Loan Agreement) shall have occurred and be continuing, Assignee shall have, in addition to all other rights and remedies given it by this Agreement or any other Loan Document (as defined in the Loan Agreement), those allowed by law and the rights and remedies of a secured party under the Uniform Commercial Code as enacted in any jurisdiction in which the Trademarks may be located and, without limiting the generality of the foregoing, the Assignee may immediately, without demand of performance and without other notice (except as set forth below) or demand whatsoever to Assignor, all of which are hereby expressly waived, and without advertisement, sell at public or private sale or otherwise realize upon, all or from time to time any of the Trademarks, or any interest which the Assignor may have therein, and after deducting from the proceeds of sale or other disposition of the Trademarks all expenses (including all reasonable expenses for brokers' fees and legal services), shall apply the residue of such proceeds toward the payment of the indebtedness. Any remainder of the proceeds after payment in full of the Indebtedness shall be paid over to Assignor. Notice of any sale or other disposition of the Trademarks shall be given to Assignor at least ten (10) days before the time of any intended public or private sale or other disposition of the Trademarks is to be made, which Assignor hereby agrees shall be reasonable notice of such sale or other disposition. At any such sale or other disposition Assignee or its assignee may, to the extent permissible under applicable law, purchase the whole or any part of the Trademarks sold, free from any right of redemption on the part of Assignor, which right is hereby waived and released. 8. At such time as Assignor shall completely satisfy all of the Indebtedness, this Agreement shall terminate and Assignee shall execute and deliver to Assignor all assignments, reconveyances or other instruments as may be necessary or proper to re-vest in Assignor full title to the Trademarks, subject to any disposition thereof which may have been made by Assignee pursuant hereto. 9. Any and all fees, costs and expenses, of whatever kind or nature, including the reasonable attorneys' fees and legal expenses incurred by Assignee in connection with the preparation of this Agreement and all other documents relating hereto and the consummation of this transaction, the filing or recording of any documents (including all taxes in connection therewith) in public offices, the payment or discharge of any taxes, counsel fees, maintenance fees, encumbrances or otherwise protecting, maintaining or preserving the Trademarks, or in defending or prosecuting any actions or proceedings arising out of or related to the Trademarks, shall be borne and paid by Assignor on demand by Assignee and until so paid shall be added to the principal amount of the Indebtedness and shall bear interest at the highest applicable Default Rate (as defined in the Loan Agreement). 10. Assignor shall have the duty, through counsel reasonably acceptable to Assignee, to prosecute diligently any Trademark applications pending as of the date of this Agreement or thereafter until the Indebtedness shall have been paid in full, to make federal application on registrable but unregistered Trademarks, to file and prosecute opposition and cancellation proceedings and to do any and all acts which are necessary or desirable to preserve and maintain all rights in the Trademarks. Any expenses incurred in connection with the Trademarks shall be borne by Assignor. The Assignor shall not abandon any Trademark without the consent of Assignee, which consent shall not be unreasonably withheld. 3 11. Assignor shall have the right, with the prior written consent of Assignee, which will not be unreasonably withheld, to bring any opposition proceedings, cancellation proceedings or lawsuit in its own name to enforce or protect the Trademarks, in which event Assignee may, if necessary, be joined as a nominal party to such suit if Assignee shall have been satisfied that it is not thereby incurring any risk of liability because of such joinder. Assignor shall promptly, upon demand, reimburse and indemnify Assignee for all damages, costs and expenses, including reasonable attorneys' fees incurred by Assignee, in accordance with the Loan Agreement. 12. Assignor hereby authorizes and empowers Assignee to make, constitute and appoint any officer or Assignee of Assignee as Assignee may select, in its exclusive discretion, as Assignor's true and lawful attorney-in- fact, with the power, after and during the continuance of an Event of Default, to endorse Assignor's name on all applications, documents, papers and instruments necessary for Assignee to use the Trademarks, or to grant or issue any exclusive or nonexclusive license under the Trademarks to anyone else, or necessary for Assignee to assign, pledge, convey or otherwise transfer title in or dispose of the Trademarks to any third person as a part of Assignee's realization on such collateral upon acceleration of the Indebtedness following an Event of Default. Assignor hereby ratifies all that such attorney shall lawfully do or cause to be done by virtue hereof. This power of attorney being coupled with an interest shall be irrevocable for the life of this Agreement. 13. If Assignor fails to comply with any of its obligations hereunder, Assignee may do so in Assignor's name or in Assignee's name, but at Assignor's expense, and Assignor hereby agrees to reimburse Assignee in full for all expenses, including reasonable attorneys' fees, incurred by Assignee in protecting, defending and maintaining the Trademarks. 14. No course of dealing between Assignor and Assignee, nor any failure to exercise, nor any delay in exercising, on the part of Assignee, any right, power or privilege hereunder or under the Loan Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or thereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege. 15. All of Assignee's rights and remedies with respect to the Trademarks, whether established hereby or by the Security Agreement, the Loan Agreement or any other agreements or by law, shall be cumulative and may be exercised singularly or concurrently. 16. The provisions of this Agreement are severable, and if any clause or provision shall be held invalid and unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall affect only such clause or provision, or part thereof, in such jurisdiction, and shall not in any manner affect such clause or provision in any other jurisdiction, or any other clause or provision of this Agreement in any jurisdiction. 17. This Agreement is subject to modification only by a writing signed by both parties, except as provided in paragraph 6. 4 18. This Agreement shall be binding upon Assignor and Assignee and their respective permitted successors and assigns, and shall inure to the benefit of Assignor, Assignee and the respective permitted successors and assigns, of Assignee and Assignor. 19. The validity and interpretation of this Agreement and the rights and obligations of the parties shall be governed by the laws of the State of California. WITNESS the execution hereof under seal as of the day and year first above written. COMPS InfoSystems, Inc. By: /s/ Christopher A. Crane --------------------------- Name: Christopher A. Crane Title: President and CEO Venture Lending & Leasing, Inc. By: /s/ Salvador O. Gutierrez ---------------------------- Name: Salvador O. Gutierrez Title: President 5 SCHEDULE 1 TO TRADEMARK COLLATERAL ASSIGNMENT A. TRADEMARK AND TRADEMARK APPLICATIONS: Application Issue or Expiration or Trademark No. Filing Date Date Title - ---------------- ----------- ----------- ----- T00441US0 08/06/91 08/06/01 COMPS T00121US0 10/29/91 10/29/01 COMPSLINK T01786US0 02/20/96 02/20/96 CALLCOMPS T01811US0 08/15/95 N/A WINCOMPS (pending) B. PATENT LICENSES: Corresponding Date License Termination Trademark No. Granted Licensee Date - ------------- ------------- -------- ----------- T00441US0 8/25/95 DJA Partners 9/30/98 T00441US0 8/31/95 TRW REDI 8/31/00 T00441US0 1/01/96 DataQuick Information Systems 1/01/99 6 EX-10.11 16 PATENT COLLATERAL ASSIGNMENT DATED 9/24/96 Exhibit 10.11 PATENT COLLATERAL ASSIGNMENT ---------------------------- This Agreement is made on the 24th day of September, 1996, between COMPS InfoSystems, Inc., a Delaware corporation, having a mailing address at 9888 Carroll Centre Road, San Diego, CA 92126-4580 ("Assignor"), and Venture Lending & Leasing, Inc. ("Assignee"). Assignee's address is 2010 North First Street, Suite 310, San Jose, California 95131. RECITALS -------- A. Assignor owns the Patents and Patent applications listed on Schedule 1 ---------- hereto, and is a party to the Patent Licenses listed on Schedule 1 hereto; ---------- B. Assignor and Assignee are parties to a Loan Agreement of even date herewith (as the same may be amended from time to time, the "Loan Agreement"); C. Pursuant to the terms of the Security Agreement of even date herewith (as the same may be amended from time to time, the "Security Agreement"), by Assignor in favor of Assignee, Assignor has granted to Assignee a security interest in certain personal property assets of Assignor, including all right, title and interest of Assignor in, to and under all of Assignor's Patents (as defined in the Security Agreement), all of Assignor's Patent applications and all of Assignor's Patent Licenses (as defined in the Security Agreement), whether presently existing or hereafter arising or acquired, and all products and proceeds thereof, including, without limitation, any and all causes of action which may exist by reason of infringement thereof for the full term of the Patents, to secure the payment of the Indebtedness (as defined in the Loan Agreement); D. Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Loan Agreement and the Security Agreement. NOW, THEREFORE, in consideration of the premises, Assignor hereby agrees with Assignee as follows: 1. To secure the complete and timely satisfaction of all Indebtedness, Assignor hereby grants, assigns and conveys to Assignee a continuing security interest in and lien on all of Assignor's entire right, title and interest in and to the Patents, Patent applications and Patent Licenses listed on Schedule 1 hereto (as the same may be amended pursuant hereto ---------- from time to time), including, without limitation, all proceeds thereof (such as, by way of example, license royalties and proceeds of infringements, all rights corresponding thereto throughout the world and all reissues, divisions, continuations, renewals, extensions and continuations-in-part thereof (collectively called the "Patents"). 2. Assignor covenants and warrants that: (a) The Patents are subsisting and have not been adjudged invalid or unenforceable, in whole or in part; (b) To the best of Assignor's knowledge, each of the Patents is valid and enforceable and Assignor has notified Assignee in writing of all prior art (including public uses and sales) of which it is aware; (c) Assignor is the sole and exclusive owner of the entire and unencumbered right, title and interest in and to each of the Patents, free and clear of any liens, charges and encumbrances, including, without limitation, pledges, assignments, licenses, shop rights and covenants by Assignor not to sue third persons, except (i) Permitted Liens; and (ii) any license disclosed in ------ schedule 1; and - ---------- (d) Assignor has the unqualified right to enter into this Agreement and perform its terms. 3. Assignor agrees that, until all of the Indebtedness shall have been satisfied in full, it will not enter into any agreement (for example, a license agreement) which is inconsistent with Assignor's obligations under this Agreement, without Assignee's prior written consent; provided, that so long as -------- no Default or Event of Default (as defined in the Loan Agreement) shall have occurred and be continuing, Assignor may grant licenses to third parties to use the Patents in the ordinary course of business of both Assignor and such third party on arm's length and customary business terms. 4. If, before the Indebtedness shall have been satisfied in full, Assignor shall obtain rights to any new patentable inventions, or become entitled to the benefit of any Patent application or Patent for any reissue, division, continuation, renewal, extension, or continuation-in-part of any Patent or any improvement on any Patent, the provisions of paragraph 1 shall automatically apply thereto and Assignor shall give to Assignee prompt notice thereof in writing. 5. Assignor authorizes Assignee unilaterally to modify this Agreement by amending Schedule 1 to include any future Patents and Patent applications ---------- which are Patents under paragraph 1 or paragraph 4 hereof. 6. If any Event of Default (as defined in the Loan Agreement) shall have occurred and be continuing, Assignee shall have, in addition to all other rights and remedies given it by this Agreement or any other Loan Document (as defined in the Loan Agreement), those allowed by law and the rights and remedies of a secured party under the Uniform Commercial Code as enacted in any jurisdiction in which the Patents may be located and, without limiting the generality of the foregoing, Assignee may immediately, without demand of performance and without other notice (except as set forth below) or demand whatsoever to Assignor, all of which are hereby expressly waived, and without advertisement, sell at public or private sale or otherwise realize upon, the whole or from time to time any part of the Patents, or any interest which the Assignor may have therein, and after deducting from the proceeds of sale or other disposition of the Patents all expenses (including reasonable expenses for brokers' fees and legal services), shall apply the residue of such proceeds toward the payment of the Indebtedness. Any remainder of the proceeds after payment in full of the Indebtedness shall be paid over to Assignor. Notice of any sale or other disposition of the Patents shall be given to Assignor at least ten (10) days before the time of any intended public or private sale or other disposition of the Patents is to be made, which Assignor hereby agrees shall be reasonable notice 2 of such sale or other disposition. At any such sale or other disposition Assignee may, to the extent permissible under applicable law, purchase the whole or any part of the Patents sold, free from any right of redemption on the part of Assignor, which right is hereby waived and released. 7. Assignor hereby authorizes and empowers Assignee to make, constitute and appoint any officer or agent of Assignee, as Assignee may select in its exclusive discretion, as Assignor's true and lawful attorney-in-fact, with the power, after and during the continuance of an Event of Default, to endorse Assignor's name on all applications, documents, papers and instruments necessary for Assignee to use the Patents, or to grant or issue any exclusive or nonexclusive license under the Patents to any third person, or necessary for Assignee to assign, pledge, convey or otherwise transfer title in or dispose of the Patents to any third person as a part of Assignee's realization on such collateral upon acceleration of the Indebtedness following an Event of Default. Assignor hereby ratifies all that such attorney shall lawfully do or cause to be done by virtue hereof. This power of attorney being coupled with an interest shall be irrevocable for the life of this Agreement. 8. At such time as Assignor shall completely satisfy all of the Indebtedness, this Agreement shall terminate and Assignee shall execute and deliver to Assignor all assignments, reconveyances or other instruments as may be necessary or proper to re-vest in Assignor full title to the Patents, subject to any disposition thereof which may have been made by Assignee pursuant hereto. 9. Any and all fees, costs and expenses, of whatever kind or nature, including the reasonable attorneys' fees and legal expenses incurred by Assignee in connection with the preparation of this Agreement and all other documents relating hereto and the consummation of this transaction, the filing or recording of any documents (including all taxes in connection therewith) in public offices, the payment or discharge of any taxes, counsel fees, maintenance fees, encumbrances or otherwise protecting, maintaining or preserving the Patents, or in defending or prosecuting any actions or proceedings arising out of or related to the Patents, shall be borne and paid by Assignor on demand by Assignee and until so paid shall be added to the principal amount of the Indebtedness and shall bear interest at the highest applicable Default Rate (as defined in the Loan Agreement). 10. Assignor shall have the duty, through counsel reasonably acceptable to Assignee, to prosecute diligently any Patent applications pending as of the date of this Agreement or thereafter until the Indebtedness shall have been paid in full, to make application on unpatented but patentable inventions and to preserve and maintain all rights in Patent applications and Patents, including, without limitation, the payment of all maintenance fees. Any expenses incurred in connection with such an application shall be borne by Assignor. The Assignor shall not abandon any right to file a Patent application, or any pending Patent application or Patent without the consent of Assignee, which consent shall not be unreasonably withheld. 11. Assignor shall have the right, with the consent of Assignee, which shall not be unreasonably withheld, to bring suit in its own name, and to join Assignee, if necessary, as a party to such suit so long as Assignee is satisfied that such joinder will not subject it to any risk of liability, to enforce the Patents. Assignor shall promptly, upon demand, reimburse and 3 indemnify Assignee for all damages, costs and expenses, including reasonable attorneys, fees incurred by Assignee, in accordance with the Loan Agreement. 12. No course of dealing between Assignor and Assignee, nor any failure to exercise, nor any delay in exercising, on the part of Assignee, any right, power or privilege hereunder or under the Loan Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or thereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege. 13. All of Assignee's rights and remedies with respect to the Patents, whether established hereby or by the Security Agreement, the Loan Agreement or any other agreements or by law shall be cumulative and may be exercised singularly or concurrently. 14. The provisions of this Agreement are severable, and if any clause or provision shall be held invalid and unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall affect only such clause or provision, or part thereof, in such jurisdiction, and shall not in any manner affect such clause or provision in any other jurisdiction, or any clause or provision of this Agreement in any jurisdiction. 15. This Agreement is subject to modification only by a writing signed by both parties, except as provided in paragraph 5. 16. This Agreement shall be binding upon Assignor and Assignee and their respective permitted successors and assigns, and shall inure to the benefit of Assignor, Assignee and the respective permitted successors and assigns of Assignor and Assignee. 17. The validity and interpretation of this Agreement and the rights and obligations of the parties shall be governed by the laws of the State of California. 4 WITNESS the execution hereof under seal as of the day and year first above written. COMPS InfoSystems, Inc. By: /s/ Christopher A. Crane ---------------------------- Name: Christopher A. Crane Title: President and CEO Venture Lending & Leasing, Inc. By: /s/ Salvador O. Gutierrez ----------------------------- Name: Salvador O. Gutierrez Title: President 5 SCHEDULE 1 TO PATENT COLLATERAL ASSIGNMENT A. PATENTS AND PATENT APPLICATIONS: Application Issue or Expirat or Patent No. Filing Date Date Title ------------------ -------------- ----------- ------- None. B. PATENT LICENSES: Corresponding Date License Termination Patent No. Granted Licensee Date ---------------- --------------- ---------- ------------- None. 6 EX-10.12 17 PROMISSORY NOTE Exhibit 10.12 Note No. ______ FORM OF PROMISSORY NOTE (Equipment Loan) [Principal Amount] [Date] San Jose, California The undersigned ("Borrower") promises to pay to the order of VENTURE LENDING & LEASING, INC., a Maryland corporation ("Lender") at its office at 2010 North First Street, Suite 310, San Jose, California 95l3l, or at such other place as Lender may designate in writing, in lawful money of the United States of America, the principal sum of [Principal Amount] ($________), with Basic Interest thereon from the date hereof until maturity, whether scheduled or accelerated, at a fixed rate per annum of eight and 75/100 percent (8.75%), and with Additional Interest in the sum of [15% of Principal Amount] ($_________) payable on the Maturity Date. This Note is one of the Notes referred to in, and is entitled to all the benefits of, a Loan Agreement dated as of September 24, 1996, between Borrower and Lender. Each capitalized term not otherwise defined herein shall have the meaning set forth in the Loan Agreement. The Loan Agreement contains provisions for the acceleration of the maturity of this Note upon the happening of certain stated events. Principal of and interest on this Note shall be payable as follows: On __________, Borrower shall pay (i) a first (1st) amortization installment of principal and Basic Interest in the amount of $_________, in advance for the month of _________; and (ii) a 48th amortization installment of principal and Basic Interest in the amount of $__________ in advance for the month of _____________. Commencing on __________, and continuing on the first day of each consecutive month thereafter, principal and Basic Interest shall be payable, in advance, in forty-five (45) equal consecutive installments of $_________ each, with a 46th installment equal to the entire unpaid principal balance and accrued Basic Interest on _____________. The Additional Interest amount shall be payable on ______________. Any unpaid payments of principal or interest on this Note shall bear interest from their respective maturities, whether scheduled or accelerated, at a rate per annum equal to the Default Rate. Borrower shall pay such interest on demand. Interest, charges and fees shall be calculated for actual days elapsed on the basis of a 360-day year, which results in higher interest, charge or fee payments than if a 365-day year were used. In no event shall Borrower be obligated to pay interest, charges or fees at a rate in excess of the highest rate permitted by applicable law from time to time in effect. This Note shall be governed by, and construed in accordance with, the laws of the State of California. COMPS InfoSystems, Inc. By: ---------------------------- Christopher A. Crane, President and CEO 2 Schedule to Promissory Note (Equipment Loan) --------------------------------------------
Principal and Basic Additional Interest Principal Amount Date Interest Due Date Due Date - ---------------- ---- ----------------- -------- $ 836,879 09/30/96 08/01/00 10/01/00 340,931 03/31/97 02/01/01 04/01/01 101,788 11/18/97 10/01/01 12/01/01 103,367 12/01/97 10/01/01 12/01/01 116,758 12/11/97 11/01/01 01/01/02
EX-10.13 18 PROMISSORY NOTE Exhibit 10.13 Note No. ______ FORM OF PROMISSORY NOTE (Term Loan) [Principal Amount] [Date] San Jose, California The undersigned ("Borrower") promises to pay to the order of VENTURE LENDING & LEASING, INC., a Maryland corporation ("Lender") at its office at 2010 North First Street, Suite 310, San Jose, California 95l3l, or at such other place as Lender may designate in writing, in lawful money of the United States of America, the principal sum of [Principal Amount] ($__________), with Basic Interest thereon from the date hereof until maturity, whether scheduled or accelerated, at a fixed rate per annum of eight and 75/100 percent (8.75%), and with Additional Interest in the sum of [15% of Principal Amount] ($________) payable on the Maturity Date. This Note is one of the Notes referred to in, and is entitled to all the benefits of, a Loan Agreement dated as of September 24, 1996, between Borrower and Lender. Each capitalized term not otherwise defined herein shall have the meaning set forth in the Loan Agreement. The Loan Agreement contains provisions for the acceleration of the maturity of this Note upon the happening of certain stated events. Principal of and interest on this Note shall be payable as follows: On _________ Borrower shall pay (i) a first (1st) amortization installment of principal and Basic Interest in the amount of $_________, in advance for the month of __________; and (ii) a 36th amortization installment of principal and Basic Interest in the amount of $__________ in advance for the month of ____________. Commencing on ____________ and continuing on the first day of each consecutive month thereafter, principal and Basic Interest shall be payable, in advance, in thirty-three (33) equal consecutive installments of $__________each, with a 34th installment equal to the entire unpaid principal balance and accrued Basic Interest on ___________. The Additional Interest amount shall be payable on ___________. Any unpaid payments of principal or interest on this Note shall bear interest from their respective maturities, whether scheduled or accelerated, at a rate per annum equal to the Default Rate. Borrower shall pay such interest on demand. Interest, charges and fees shall be calculated for actual days elapsed on the basis of a 360-day year, which results in higher interest, charge or fee payments than if a 365-day year were used. In no event shall Borrower be obligated to pay interest, charges or fees at a rate in excess of the highest rate permitted by applicable law from time to time in effect. This Note shall be governed by, and construed in accordance with, the laws of the State of California. COMPS InfoSystems, Inc. By: ---------------------------- Christopher A. Crane, President and CEO 2 Schedule to Promissory Note (Term Loan) ---------------------------------------
Principal and Basic Additional Interest Principal Amount Date Interest Due Date Due Date - ---------------- ---- ----------------- ------------------- $ 575,000 09/30/96 08/01/99 10/01/99 300,000 10/27/98 09/01/01 11/01/01 83,242 12/11/97 10/01/01 12/01/01
EX-10.14 19 OFFICE BUILDING LEASE EXHIBIT 10.14 STANDARD INDUSTRIAL/COMMERCIAL MULTI-LESSEE LEASE--MODIFIED NET AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION 1. BASIC PROVISIONS ("BASIC PROVISIONS"). 1.1 PARTIES: This lease ("LEASE"), dated for reference purposes only, January 31, 1999, is made by and between COMPS Plaza Associates, L.P. ("LESSOR") and COMPS.COM, INC., a Delaware corporation ("LESSEE"), (collectively the "PARTIES," or individually a "PARTY"). 1.2 (a) PREMISES: That certain portion of the Building, including all improvements therein or to be provided by Lessor under the terms of this Lease, commonly known by the street address of 9888 Carroll Center Road, located in the City of San Diego, County of San Diego, State of California, with zip code 92126, as outlined on Exhibit A attached hereto ("PREMISES"). The "BUILDING" is that certain building containing the Premises and generally described as (describe briefly the nature of the Building): two story office building containing approximately 52,425 rentable square feet; stucco exterior and central courtyard. In addition to Lessee's rights to use and occupy the Premises as hereinafter specified, Lessee shall have non-exclusive rights to the Common Areas (as defined in Paragraph 2.7 below) as hereinafter specified, but shall not have any rights to the roof, exterior walls or utility raceways of the Building or to any other buildings in the Industrial Center. The Premises, the Building, the Common Areas, the land upon which they are located, along with all other buildings and improvements thereon, are herein collectively referred to as the "INDUSTRIAL CENTER." (Also see Paragraph 2). 1.2 (b) PARKING: 112 unreserved vehicle parking spaces ("UNRESERVED PARKING SPACES"); and 1 reserved vehicle parking spaces ("RESERVED PARKING SPACES"). (Also see Paragraph 2.6.). 1.3 TERM: Five (5) years and -0- months ("ORIGINAL TERM") commencing February 1, 1999 ("COMMENCEMENT DATE") and ending January 31, 2009 ("EXPIRATION DATE"). (Also see Paragraph 3.) 1.4 EARLY POSSESSION: not applicable ("EARLY POSSESSION DATE"). (Also see Paragraphs 3.2 and 3.3.) 1.5 BASE RENT: $34,877.85 per month ("BASE RENT"), payable on the first day of each month commencing March 1, 1999 (Also see Paragraph 4). [ X ] If this box is checked, this Lease provides for the Base Rent to be adjusted per Addendum 1, attached hereto. 1.6 (a) BASE RENT PAID UPON EXECUTION: $ -0- as Base Rent for the period not applicable. 1.6 (b) LESSEE'S SHARE OF OPERATING EXPENSES: See Addendum 1 percent (%) ("LESSEE'S SHARE") as determined by [ ] prorata square footage of the Premises as compared to the total square footage of the Building or [ XX ] other criteria as described in Addendum 1. 1.7 SECURITY DEPOSIT: $ 37,877.85 ("SECURITY DEPOSIT"). (Also see Paragraph 5.) 1.8 PERMITTED USE: General office, all uses incidental thereto and all other lawful uses permitted under applicable zoning laws ("PERMITTED USE"). (Also see Paragraph 6). 1.9 INSURING PARTY. Lessor is the "INSURING PARTY." (Also see Paragraph 8.) 1.10 (a) 1.12 ADDENDA and EXHIBITS. Attached hereto is an Addendum or Addenda consisting of Paragraphs 1 through 13 , Inserts to Lease pages 1-4 and Exhibits A through C , all of which constitute a part of this Lease. 2. PREMISES, PARKING AND COMMON AREAS. 2.1 LETTING. Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor, the Premises, for the term, at the rental, and upon all of the terms, covenants and conditions set forth in this Lease. Unless otherwise provided herein, any statement of square footage set forth in this Lease, or that may have been used in calculating rental and/or Operating Expenses, is an approximation which Lessor and Lessee agree is reasonable and the rental and Lessee's Share (as defined in Paragraph 1.6(b)) based thereon is not subject to revision whether or not the actual square footage is more or less. 2.2 CONDITION. Lessor shall deliver the Premises to Lessee clean and free of debris on the Commencement Date and warrants to Lessee that the existing plumbing, electrical systems, fire sprinkler system, lighting, air conditioning and heating systems and loading doors, if any, in the Premises, other than those constructed by Lessee, shall be in good operating condition on the Commencement Date. If a non-compliance with said warranty exists as of the Commencement Date, Lessor shall, except as otherwise provided in this Lease, promptly after receipt of written notice from Lessee setting forth with specificity the nature and extent of such non-compliance, rectify same at Lessor's expense. If Lessee does not give Lessor written notice of a non-compliance with this warranty within thirty (30) days after the Commencement Date, correction of that non-compliance shall be the obligation of Lessee at Lessee's sole cost and expense. 2.3 COMPLIANCE WITH COVENANTS, RESTRICTIONS AND BUILDING CODE. Lessor warrants that any improvements (other than those constructed by Lessee or at Lessee's direction) on or in the Premises which have been constructed or installed by Lessor or with Lessor's consent or at Lessor's direction shall comply with all applicable covenants or restrictions of record and applicable building codes, regulations and ordinances in effect on the Commencement Date. Lessor further warrants to Lessee that Lessor has no knowledge of any claim having been made by any governmental agency that a violation or violations of applicable building codes, regulations, or ordinances exist with regard to the Premises as of the Commencement Date. Said warranties shall not apply to any Alterations or Utility Installations (defined in Paragraph 7.3(a)) made or to be made by Lessee. If the Premises do not comply with said warranties, Lessor shall, except as otherwise provided in this Lease, promptly after receipt of written notice from Lessee given within six (6) months following the Commencement Date and setting forth with specificity the nature and extent of such non-compliance, take such action, at Lessor's expense, as may be reasonable or appropriate to rectify the non-compliance. Lessor makes no warranty that the Permitted Use in Paragraph 1.8 is permitted for the Premises under Applicable Laws (as defined in Paragraph 2.4). 2.4 ACCEPTANCE OF PREMISES. Lessee hereby acknowledges: (a) that it has been advised by the Broker(s) to satisfy itself with respect to the condition of the Premises (including but not limited to the electrical and fire sprinkler systems, security, environmental aspects, seismic and earthquake requirements, and compliance with the Americans with Disabilities Act and applicable zoning, municipal, county, state and federal laws, ordinances and regulations and any covenants or restrictions of record (collectively "APPLICABLE LAWS") and the present and future suitability of the Premises for Lessee's intended use; (b) that Lessee has made such investigation as it deems necessary with reference to such matters, is satisfied with reference thereto, and assumes all responsibility therefore as the same relate to Lessee's occupancy of the Premises and/or the terms of this Lease; and (c) that neither Lessor, nor any of Lessor's agents, has made any oral or written representations or warranties with respect to said matters other than as set forth in this Lease. 2.5 LESSEE AS PRIOR OWNER/OCCUPANT. The warranties made by Lessor in this Paragraph 2 shall be of no force or effect if immediately prior to the date set forth in Paragraph 1.1 Lessee was the owner or occupant of the Premises. In such event, Lessee shall, at Lessee's sole cost and expense, correct any non- compliance of the Premises with said warranties. 2.6 VEHICLE PARKING. Lessee shall be entitled to use the number of Unreserved Parking Spaces and Reserved Parking Spaces specified in Paragraph 1.2(b) on those portions of the Common Areas designated from time to time by Lessor for parking. Lessee shall not use more parking spaces than said number. Said parking spaces shall be used for parking by vehicles no larger than full- size passenger automobiles or pick-up trucks, herein called "PERMITTED SIZE VEHICLES." Vehicles other than Permitted Size Vehicles shall be parked and loaded or unloaded as directed by Lessor in the Rules and Regulations (as defined in Paragraph 40) issued by Lessor. (Also see Paragraph 2.9.) (a) Lessee shall not permit or allow any vehicles that belong to or are controlled by Lessee or Lessee's employees, suppliers, shippers, customers, contractors or invitees to be loaded, unloaded, or parked in areas other than those designated by Lessor for such activities. (b) If Lessee permits or allows any of the prohibited activities described in this Paragraph 2.6, then Lessor shall have the right, without notice, in addition to such other rights and remedies that it may have, to remove or tow away the vehicle involved and charge the cost to Lessee, which cost shall be immediately payable upon demand by Lessor. (c) Lessor shall at the Commencement Date of this Lease, provide the parking facilities required by Applicable Law. 2.7 COMMON AREAS - DEFINITION. The term "COMMON AREAS" is defined as all areas and facilities outside the Premises and within the exterior boundary line of the Industrial Center and interior utility raceways within the Premises that are provided and designated by the Lessor from time to time for the general non- exclusive use of Lessor, Lessee and other lessees of the Industrial Center and their respective employees, suppliers, shippers, customers, contractors and invitees, including parking areas, loading and unloading areas, trash areas, roadways, sidewalks, walkways, parkways, driveways and landscaped areas. 2.8 COMMON AREAS - LESSEE'S RIGHTS. Lessor hereby grants to Lessee, for the benefit of Lessee and its employees, suppliers, shippers, contractors, customers and invitees, during the term of this Lease, the non-exclusive right to use, in common with others entitled to such use, the Common Areas as they exist from time to time, subject to any rights, powers, and privileges reserved by Lessor under the terms hereof or under the terms of any rules and regulations or restrictions governing the use of the Industrial Center. Under no circumstances shall the right herein granted to use the Common Areas be deemed to include the right to store any property, temporarily or permanently, in the Common Areas. Any such storage shall be permitted only by the prior Initials: CM ---- KG ---- -1- written consent of Lessor or Lessor's designated agent, which consent may be revoked at any time. In the event that any unauthorized storage shall occur then Lessor shall have the right, without notice, in addition to such other rights and remedies that it may have, to remove the property and charge the reasonable cost to Lessee, which cost shall be immediately payable upon demand by Lessor. 2.9 COMMON AREAS - RULES AND REGULATIONS. Lessor or such other person(s) as Lessor may appoint shall have the exclusive control and management of the Common Areas and shall have the right, from time to time, to establish, modify, amend and enforce reasonable and non-discriminatory Rules and Regulations with respect thereto in accordance with Paragraph 40. Lessee agrees to abide by and conform to all such Rules and Regulations, and to cause its employees, suppliers, shippers, customers, contractors and invitees to so abide and conform. Lessor shall not be responsible to Lessee for the non-compliance with said rules and regulations by other lessees of the Industrial Center. 2.10 COMMON AREAS - CHANGES. Lessor shall have the right, in Lessor's sole discretion, from time to time: (a) To make changes to the Common Areas, including, without limitation, changes in the location, size, shape and number of driveways, entrances, parking spaces, parking areas, loading and unloading areas, ingress, egress, direction of traffic, landscaped areas, walkways and utility raceways, provided that such charges shall not unreasonably interfere with Lessee's business or access thereto; (b) To close temporarily any of the Common Areas for maintenance purposes so long as reasonable access to the Premises remains available; (c) To designate other land outside the boundaries of the Industrial Center to be a part of the Common Areas; (d) To add additional buildings and improvements to the Common Areas; (e) To use the Common Areas while engaged in making additional improvements, repairs or alterations to the Industrial Center, or any portion thereof; and (f) To do and perform such other acts and make such other changes in, to or with respect to the Common Areas and Industrial Center as Lessor may, in the exercise of sound business judgment, deem to be appropriate. 3. TERM. 3.1 TERM. The Commencement Date, Expiration Date and Original Term of this Lease are as specified in Paragraph 1.3. 3.2 4. RENT. 4.1 BASE RENT. Lessee shall pay Base Rent, and other rent or charges, as the same may be adjusted from time to time, to Lessor in lawful money of the United States, without offset or deduction, on or before the day on which it is due under the terms of this Lease. Base Rent and all other rent and charges for any period during the term hereof which is for less than one full month shall be prorated based upon the actual number of days of the month involved. Payment of Base Rent and other charges shall be made to Lessor at its address stated herein or to such other persons or at such other addresses as Lessor may from time to time designate in writing to Lessee. 4.2 OPERATING EXPENSES. Lessee shall pay monthly to Lessor during the term hereof, in addition to the Base Rent, Lessee's Share (as specified in Paragraph 1.6(b)) of all Operating Expenses, as hereinafter defined, during each calendar year of the term of this Lease, in accordance with the following provisions: (a) "OPERATING EXPENSES" are defined, for purposes of this Lease, as all costs incurred by Lessor relating to the ownership and operation of the Industrial Center, including, but not limited to, the following: (i) The operation, repair and maintenance, in neat, clean, good order and condition, of the following: (aa) The Common Areas and the Building, including parking areas, loading and unloading areas, trash areas, roadways, sidewalks, walkways, parkways, driveways, landscaped areas, striping, bumpers, irrigation systems, lighting, fences and gates, elevators and roof. (bb) Exterior signs and any tenant directories. (cc) Fire detection and sprinkler systems. (ii) The cost of water, gas, electricity and telephone to service the Common Areas and the Building. (iii) Trash disposal, property management and security services and the costs of any environmental inspections. (iv) Reserves set aside for maintenance and repair of Common Areas and the Building. (v) Real Property Taxes (as defined in Paragraph 10.2). (vi) The cost of the premiums for the insurance policies maintained by Lessor under Paragraph 8 hereof. (vii) Any deductible portion of an insured loss concerning the Building or the Common Areas. (viii) Any other services to be provided by Lessor that are stated elsewhere in this Lease to be a Operating Expense. (b) Any Operating Expenses and Real Property Taxes that are specifically attributable to the Building or to any other building in the Industrial Center or to the operation, repair and maintenance thereof, shall be allocated entirely to the Building or to such other building. However, any Operating Expenses and Real Property Taxes that are not specifically attributable to the Building or to any other building or to the operation, repair and maintenance thereof, shall be equitably allocated by Lessor to all buildings in the Industrial Center. Insert 4.2(b) (c) The inclusion of the improvements, facilities and services set forth in Subparagraph 4.2(a) shall not be deemed to impose an obligation upon Lessor to either have said improvements or facilities or to provide those services unless the Industrial Center already has the same, Lessor already provides the services, or Lessor has agreed elsewhere in this Lease to provide the same or some of them. (d) Lessee's Share of Operating Expenses shall be payable by Lessee within ten (10) days after a reasonably detailed statement of actual expenses is presented to Lessee by Lessor. At Lessor's option, however, an amount may be estimated by Lessor from time to time of Lessee's Share of annual Operating Expenses and the same shall be payable monthly or quarterly, as Lessor shall designate, during each 12-month period of the Lease term, on the same day as the Base Rent is due hereunder. Lessor shall deliver to Lessee within sixty (60) days after the expiration of each calendar year a reasonably detailed statement showing Lessee's Share of the actual Operating Expenses incurred during the preceding year. If Lessee's payments under this Paragraph 4.2(d) during said preceding year exceed Lessee's Share as indicated on said statement, Lessor shall be credited the amount of such over-payment against Lessee's Share of Operating Expenses next becoming due. If Lessee's payments under this Paragraph 4.2(d) during said preceding year were less than Lessee's Share as indicated on said statement, Lessee shall pay to Lessor the amount of the deficiency within ten (10) days after delivery by Lessor to Lessee of said statement. Insert 4.2(d) 5. SECURITY DEPOSIT. Lessee shall deposit with Lessor upon Lessee's execution hereof the Security Deposit set forth in Paragraph 1.7 as security for Lessee's faithful performance of Lessee's obligations under this Lease. If Lessee fails to pay Base Rent or other rent or charges due hereunder, or otherwise Defaults under this Lease (as defined in Paragraph 13.1), Lessor may use, apply or retain all or any portion of said Security Deposit for the payment of any amount due Lessor or to reimburse or compensate Lessor for any liability, cost, expense, loss or damage (including attorneys' fees) which Lessor may suffer or incur by reason thereof. If Lessor uses or applies all or any portion of said Security Deposit, Lessee shall within ten (10) days after written request therefore deposit monies with Lessor sufficient to restore said Security Deposit to the full amount required by this Lease. Lessor shall not be required to keep all or any part of the Security Deposit separate from its general accounts. Lessor shall, at the expiration or earlier termination of the term hereof and after Lessee has vacated the Premises, return to Lessee (or, at Lessor's option, to the last assignee, if any, of Lessee's interest herein), that portion of the Security Deposit not used or applied by Lessor. Unless otherwise expressly agreed in writing by Lessor, no part of the Security Deposit shall be considered to be held in trust, to bear interest except from and after the tenth (10) day following the expiration or earlier termination of this Lease, the Security Deposit shall accrue interest at the rate set forth in Paragraph 19 of this Lease or other increment for its use, or to be prepayment for any monies to be paid by Lessee under this Lease. Upon execution of each Amendment for expansion space, Lessee shall deposit with Lessor a Security Deposit equal to the initial monthly Base Rent for such expansion space. 6. USE. 6.1 PERMITTED USE. (a) Lessee shall use and occupy the Premises only for the Permitted Use set forth in Paragraph 1.8, or any other legal use which is reasonably comparable thereto, and for no other purpose. Lessee shall not use or permit the use of the Premises in a manner that is unlawful, creates waste or a nuisance, or that disturbs owners and/or occupants of, or causes damage to the Premises or neighboring premises or properties. (b) Lessor hereby agrees to not unreasonably withhold or delay its consent to any written request by Lessee, Lessee's assignees or subtenants, and by prospective assignees and subtenants of Lessee, its assignees and subtenants, for a modification of said Permitted Use, so long as the same will not impair the structural integrity of the improvements on the Premises or in the Building or the mechanical or electrical systems therein, does not conflict with uses by other lessees, is not significantly more burdensome to the Premises or the Building and the improvements thereon, and is otherwise permissible pursuant to this Paragraph 6. If Lessor elects to withhold such consent, Lessor shall within five (5) business days after such request give a written notification of same, which notice shall include an explanation of Lessor's reasonable objections to the change in use. Initials: CM ---- KG ---- -2- 6.2 HAZARDOUS SUBSTANCES. (a) REPORTABLE USES REQUIRE CONSENT. The term "HAZARDOUS SUBSTANCE" as used in this Lease shall mean any product, substance, chemical, material or waste whose presence, nature, quantity and/or intensity of existence, use, manufacture, disposal, transportation, spill, release or effect, either by itself or in combination with other materials expected to be on the Premises, is either: (i) potentially injurious to the public health, safety or welfare, the environment, or the Premises; (ii) regulated or monitored by any governmental authority; or (iii) a basis for potential liability of Lessor to any governmental agency or third party under any applicable statute or common law theory. Hazardous Substance shall include, but not be limited to, hydrocarbons, petroleum, gasoline, crude oil or any products or by-products thereof. Lessee shall not engage in any activity in or about the Premises which constitutes a Reportable Use (as hereinafter defined) of Hazardous Substances without the express prior written consent of Lessor and compliance in a timely manner (at Lessee's sole cost and expense) with all Applicable Requirements (as defined in Paragraph 6.3). "REPORTABLE USE" shall mean (i) the installation or use of any above or below ground storage tank, (ii) the generation, possession, storage, use, transportation, or disposal of a Hazardous Substance that requires a permit from, or with respect to which a report, notice, registration or business plan is required to be filed with, any governmental authority, and (iii) the presence in, on or about the Premises of a Hazardous Substance with respect to which any Applicable Laws require that a notice be given to persons entering or occupying the Premises or neighboring properties. Notwithstanding the foregoing, Lessee may, without Lessor's prior consent, but upon notice to Lessor and in compliance with all Applicable Requirements, use any ordinary and customary materials reasonably required to be used by Lessee in the normal course of the Permitted Use, so long as such use is not a Reportable Use and does not expose the Premises or neighboring properties to any meaningful risk of contamination or damage or expose Lessor to any liability therefor. In addition, Lessor may (but without any obligation to do so) condition its consent to any Reportable Use of any Hazardous Substance by Lessee upon Lessee's giving Lessor such additional assurances as Lessor, in its reasonable discretion, deems necessary to protect itself, the public, the Premises and the environment against damage, contamination or injury and/or liability therefor, including but not limited to the installation (and, at Lessor's option, removal on or before Lease expiration or earlier termination) of reasonably necessary protective modifications to the Premises (such as concrete encasements) and/or the deposit of an additional Security Deposit under Paragraph 5 hereof. (b) DUTY TO INFORM LESSOR. If Lessee knows, or has reasonable cause to believe, that a Hazardous Substance has come to be located in, on, under or about the Premises or the Building, other than as previously consented to by Lessor, Lessee shall immediately give Lessor written notice thereof, together with a copy of any statement, report, notice, registration, application, permit, business plan, license, claim, action, or proceeding given to, or received from, any governmental authority or private party concerning the presence, spill, release, discharge of, or exposure to, such Hazardous Substance including but not limited to all such documents as may be involved in any Reportable Use involving the Premises. Lessee shall not cause or permit any Hazardous Substance to be spilled or released in, on, under or about the Premises (including, without limitation, through the plumbing or sanitary sewer system) in violation of applicable laws. (c) INDEMNIFICATION. Lessee shall indemnify, protect, defend and hold Lessor, its agents, employees, lenders and ground lessor, if any, and the Premises, harmless from and against any and all damages, liabilities, judgments, costs, claims, liens, expenses, penalties, loss of permits and attorneys' and consultants' fees arising out of or involving any Hazardous Substance brought onto the Premises by or for Lessee or by anyone under Lessee's control. Lessee's obligations under this Paragraph 6.2(c) shall include, but not be limited to, the effects of any contamination or injury to person, property or the environment created or suffered by Lessee, and the cost of investigation (including consultants' and attorneys' fees and testing), removal, remediation, restoration and/or abatement thereof, or of any contamination therein involved, and shall survive the expiration or earlier termination of this Lease. No termination, cancellation or release agreement entered into by Lessor and Lessee shall release Lessee from its obligations under this Lease with respect to Hazardous Substances, unless specifically so agreed by Lessor in writing at the time of such agreement. Insert 6.2(c) 6.3 LESSEE'S COMPLIANCE WITH REQUIREMENTS. Lessee shall, at Lessee's sole cost and expense, fully, diligently and in a timely manner, comply with all "Applicable Requirements," which term is used in this Lease to mean all laws, rules, regulations, ordinances, directives, covenants, easements and restrictions of record, permits, the requirements of any applicable fire insurance underwriter or rating bureau, relating in any manner to the Premises (including but not limited to matters pertaining to (i) industrial hygiene, (ii) environmental conditions on, in, under or about the Premises, including soil and groundwater conditions, and (iii) the use, generation, manufacture, production, installation, maintenance, removal, transportation, storage, spill, or release of any Hazardous Substance), now in effect or which may hereafter come into effect. Insert 6.3 Lessee shall, within five (5) days after receipt of Lessor's written request, provide Lessor with copies of all documents and information, including but not limited to permits, registrations, manifests, applications, reports and certificates, evidencing Lessee's compliance with any Applicable Requirements reasonably specified by Lessor, and shall immediately upon receipt, notify Lessor in writing (with copies of any documents involved) of any threatened or actual claim, notice, citation, warning, complaint or report pertaining to or involving failure by Lessee or the Premises to comply with any Applicable Requirements. 6.4 INSPECTION; COMPLIANCE WITH LAW. Lessor, Lessor's agents, employees, contractors and designated representatives, and the holders of any mortgages, deeds of trust or ground leases on the Premises ("LENDERS") shall have the right to enter the Premises at any time in the case of an emergency, and otherwise with at least 24 hours prior notice, for the purpose of inspecting the condition of the Premises and for verifying compliance by Lessee with this Lease and all Applicable Requirements (as defined in Paragraph 6.3), and Lessor shall be entitled to employ experts and/or consultants in connection therewith to advise Lessor with respect to Lessee's activities, including but not limited to Lessee's installation, operation, use, monitoring, maintenance, or removal of any Hazardous Substance on or from the Premises. The costs and expenses of any such inspections shall be paid by the party requesting same, unless a Default or Breach of this Lease by Lessee or a violation of Applicable Requirements or a contamination, caused or materially contributed to by Lessee, is found to exist or to be imminent, or unless the inspection is requested or ordered by a governmental authority as the result of any such existing or imminent violation or contamination. In such case, Lessee shall upon request reimburse Lessor or Lessor's Lender, as the case may be, for the costs and expenses of such inspections. 7. MAINTENANCE, REPAIRS, UTILITY INSTALLATIONS, TRADE FIXTURES AND ALTERATIONS. 7.1 LESSEE'S OBLIGATIONS. (a) Subject to the provisions of Paragraphs 2.2 (Condition), 2.3 (Compliance with Covenants, Restrictions and Building Code), 7.2 (Lessor's Obligations), 9 (Damage or Destruction), and 14 (Condemnation), Lessee shall, at Lessee's sole cost and expense and at all times, keep the Premises and every part thereof in good order, condition and repair (whether or not such portion of the Premises requiring repair, or the means of repairing the same, are reasonably or readily accessible to Lessee, and whether or not the need for such repairs occurs as a result of Lessee's use, any prior use, the elements or the age of such portion of the Premises), including, without limiting the generality of the foregoing, all equipment or facilities specifically serving the Premises, such as plumbing, heating, air conditioning, ventilating, electrical, lighting facilities, boilers, fired or unfired pressure vessels, fire hose connections if within the Premises, fixtures, interior walls, interior surfaces of exterior walls, ceilings, floors, interior windows, doors, plate glass, but excluding any items which are the responsibility of Lessor pursuant to Paragraph 7.2 below. Lessee, in keeping the Premises in good order, condition and repair, shall exercise and perform good maintenance practices. Lessee's obligations shall include restorations, replacements or renewals when reasonably necessary to keep the Premises and all improvements thereon or a part thereof in good order, condition and state of repair. (b) Lessee shall, at Lessee's sole cost and expense, procure and maintain a contract, with copies to Lessor, in customary form and substance for and with a contractor specializing and experienced in the inspection, maintenance and service of the heating, air conditioning and ventilation system for the Premises. However, Lessor reserves the right, upon notice to Lessee, to procure and maintain the contract for the heating, air conditioning and ventilating systems, and if Lessor so elects, Lessee shall reimburse Lessor, upon demand, for the cost thereof. (c) If Lessee fails to perform Lessee's obligations under this Paragraph 7.1, Lessor may enter upon the Premises after ten (10) days' prior written notice to Lessee (except in the case of an emergency, in which case no notice shall be required), perform such obligations on Lessee's behalf, and put the Premises in good order, condition and repair, in accordance with Paragraph 13.2 below. 7.2 LESSOR'S OBLIGATIONS. Subject to the provisions of Paragraphs 2.2 (Condition), 2.3 (Compliance with Covenants, Restrictions and Building Code), 4.2 (Operating Expenses), 6 (Use), 7.1 (Lessee's Obligations), 9 (Damage or Destruction) and 14 (Condemnation), Lessor, subject to reimbursement pursuant to Paragraph 4.2, shall keep in good order, condition and repair the foundations, exterior walls, structural condition of interior bearing walls, roof, roof membrane, skylights, smoke hatches, fire sprinkler and/or standpipes and hose (if located in the Common Areas) or other automatic fire extinguishing system including fire alarm and/or smoke detection systems and equipment, fire hydrants, parking lots, walkways, parkways, driveways, irrigation systems, exterior lighting, landscaping, fences, signs and utility systems serving the Common Areas and all parts thereof, as well as providing the services for which there is Operating Expense pursuant to Paragraph 4.2. Lessor shall not be obligated to paint the interior surfaces of exterior walls nor shall Lessor be obligated to maintain, repair or replace interior windows, doors or plate glass of the Premises. Lessee expressly waives the benefit of any statute now or hereafter in effect which would otherwise afford Lessee the right to make repairs at Lessor's expense or to terminate this Lease because of Lessor's failure to keep the Building, Industrial Center or Common Areas in good order, condition and repair. Insert 7.2 7.3 UTILITY INSTALLATIONS, TRADE FIXTURES, ALTERATIONS. (a) DEFINITIONS; CONSENT REQUIRED. The term "UTILITY INSTALLATIONS" is used in this Lease to refer to all air lines, power panels, electrical distribution, security and fire protection systems, communications systems, lighting fixtures, heating, ventilating and air conditioning equipment, plumbing, and fencing in, on or about the Premises. The term "TRADE FIXTURES" shall mean Lessee's machinery and equipment which can be removed without doing material damage to the Premises. The term "ALTERATIONS" shall mean any modification of the improvements on the Premises which are provided by Lessor under the terms of this Lease, other than Utility Installations or Trade Fixtures. "LESSEE-OWNED ALTERATIONS AND/OR UTILITY INSTALLATIONS" are defined as Alterations and/or Utility Installations made by Lessee that are not yet owned by Lessor pursuant to Paragraph 7.4(a). Lessee shall not make nor cause to be made any Alterations or Utility Installations in, on, under or about the Premises without Lessor's prior written consent which shall not be unreasonably withheld or delayed. Lessee may, however, make non-structural Utility Installations to the interior of the Premises (excluding the roof) without Lessor's consent but upon notice to Lessor, so long as they are not visible from the outside of the Premises, do not involve puncturing, relocating or removing the roof or any Initials: CM ---- KG ---- -3- existing walls, or changing or interfering with the fire sprinkler or fire detection systems and the cumulative cost thereof during the term of this Lease as extended does not exceed $10,000.00 per year. (b) CONSENT. Any Alterations or Utility Installations that Lessee shall desire to make and which require the consent of the Lessor shall be presented to Lessor in written form with detailed plans. All consents given by Lessor, whether by virtue of Paragraph 7.3(a) or by subsequent specific consents, shall be deemed conditioned upon: (i) Lessee's acquiring all applicable permits required by governmental authorities; (ii) the furnishing of copies of such permits together with a copy of the plans and specifications for the Alteration or Utility Installation to Lessor prior to commencement of the work thereon; and (iii) the compliance by Lessee with all conditions of said permits in a prompt and expeditious manner. Any Alterations or Utility Installations by Lessee during the term of this Lease shall be done in a good and workmanlike manner, with good and sufficient materials, and be in compliance with all Applicable Requirements. Lessee shall promptly upon completion thereof furnish Lessor with as-built plans and specifications therefor. (c) LIEN PROTECTION. Lessee shall pay when due all claims for labor or materials furnished or alleged to have been furnished to or for Lessee at or for use on the Premises, which claims are or may be secured by any mechanic's or materialmen's lien against the Premises or any interest therein. Lessee shall give Lessor not less than ten (10) days' notice prior to the commencement of any work in, on, or about the Premises, and Lessor shall have the right to post notices of non-responsibility in or on the Premises as provided by law. If Lessee shall, in good faith, contest the validity of any such lien, claim or demand, then Lessee shall, at its sole expense, defend and protect itself, Lessor and the Premises against the same and shall pay and satisfy any such adverse judgment that may be rendered thereon before the enforcement thereof against the Lessor or the Premises. If Lessor shall require, Lessee shall furnish to Lessor a surety bond satisfactory to Lessor in an amount equal to one and one-half times the amount of such contested lien claim or demand, indemnifying Lessor against liability for the same, as required by law for the holding of the Premises free from the effect of such lien or claim. In addition, Lessor may require Lessee to pay Lessor's reasonable attorneys' fees and costs in participating in such action if Lessor shall reasonably decide it is to its best interest to do so. 7.4 OWNERSHIP, REMOVAL, SURRENDER, AND RESTORATION. (a) OWNERSHIP. Subject to Lessor's right to require their removal and to cause Lessee to become the owner thereof as hereinafter provided in this Paragraph 7.4, all Alterations and Utility Installations made to the Premises by Lessee shall be the property of and owned by Lessee, but considered a part of the Premises. Unless otherwise instructed per Subparagraph 7.4(b) hereof, all Lessee-Owned Alterations and Utility Installations shall, at the expiration or earlier termination of this Lease, become the property of Lessor and remain upon the Premises and be surrendered with the Premises by Lessee. (b) REMOVAL. Unless otherwise agreed in writing, Lessor may (at the time Lessor gives its consent to the installation of such Lessee-owned Alterations or Utility Installations) require that any or all Lessee-Owned Alterations or Utility Installations be removed by the expiration or earlier termination of this Lease, notwithstanding that their installation may have been consented to by Lessor. Lessor may require the removal at any time of all or any part of any Alterations or Utility Installations made without the required consent of Lessor. (c) SURRENDER/RESTORATION. Lessee shall surrender the Premises by the end of the last day of the Lease term or any earlier termination date, clean and free of debris and in good operating order, condition and state of repair, ordinary wear and tear excepted and subject to Paragraph 9. Ordinary wear and tear shall not include any damage or deterioration that would have been prevented by good maintenance practice or by Lessee performing all of its obligations under this Lease. Except as otherwise agreed or specified herein, the Premises, as surrendered, shall include the Alterations and Utility Installations. The obligation of Lessee shall include the repair of any damage occasioned by the installation, maintenance or removal of Lessee's Trade Fixtures, furnishings, equipment, and Lessee-Owned Alterations and Utility Installations, as well as the removal of any storage tank installed by or for Lessee, and the removal, replacement, or remediation of any soil, material or ground water contaminated by Lessee, all as may then be required by Applicable Requirements and/or good practice. Lessee's Trade Fixtures shall remain the property of Lessee and shall be removed by Lessee subject to its obligation to repair and restore the Premises per this Lease. Insert 7.4(c) 8. INSURANCE; INDEMNITY. 8.1 PAYMENT OF PREMIUMS. The cost of the premiums for the insurance policies maintained by Lessor under this Paragraph 8 shall be an Operating Expense pursuant to Paragraph 4.2 hereof. Premiums for policy periods commencing prior to, or extending beyond, the term of this Lease shall be prorated to coincide with the corresponding Commencement Date or Expiration Date. 8.2 LIABILITY INSURANCE. (a) CARRIED BY LESSEE. Lessee shall obtain and keep in force during the term of this Lease a Commercial General Liability policy of insurance protecting Lessee, Lessor and any Lender(s) whose names have been provided to Lessee in writing (as additional insureds) against claims for bodily injury, and property damage based upon, involving or arising out of the ownership, use, occupancy or maintenance of the Premises and all areas appurtenant thereto. Such insurance shall be on an occurrence basis providing single limit coverage in an amount not less than $1,000,000 per occurrence with an "Additional Insured-Managers or Lessors of Premises" endorsement and contain the "Amendment of the Pollution Exclusion" endorsement for damage caused by heat, smoke or fumes from a hostile fire. The policy shall not contain any intra-insured exclusions as between insured persons or organizations, but shall include coverage for liability assumed under this Lease as an "INSURED CONTRACT" for the performance of Lessee's indemnity obligations under this Lease. The limits of said insurance required by this Lease or as carried by Lessee shall not, however, limit the liability of Lessee nor relieve Lessee of any obligation hereunder. All insurance to be carried by Lessee shall be primary to and not contributory with any similar insurance carried by Lessor, whose insurance shall be considered excess insurance only. (b) CARRIED BY LESSOR. Lessor shall also maintain liability insurance described in Paragraph 8.2(a) above, in addition to and not in lieu of, the insurance required to be maintained by Lessee. Lessee shall not be named as an additional insured therein. 8.3 PROPERTY INSURANCE-BUILDING, IMPROVEMENTS AND RENTAL VALUE. (a) BUILDING AND IMPROVEMENTS. Lessor shall obtain and keep in force during the term of this Lease a policy or policies in the name of Lessor, with loss payable to Lessor and to any Lender(s), insuring against loss or damage to the Premises. Such insurance shall be for full replacement cost, as the same shall exist from time to time, or the amount required by any Lender(s), but in no event more than the commercially reasonable and available insurable value thereof if, by reason of the unique nature or age of the improvements involved, such latter amount is less than full replacement cost. Lessee-Owned Alterations and Utility Installations, Trade Fixtures and Lessee's personal property shall be insured by Lessee pursuant to Paragraph 8.4. If the coverage is available and commercially appropriate, Lessor's policy or policies shall insure against all risks of direct physical loss or damage (except the perils of flood and/or earthquake unless required by a Lender), including coverage for any additional costs resulting from debris removal and reasonable amounts of coverage for the enforcement of any ordinance or law regulating the reconstruction or replacement of any undamaged sections of the Building required to be demolished or removed by reason of the enforcement of any building, zoning, safety or land use laws as the result of a covered loss but not including plate glass insurance. Said policy or policies shall also contain an agreed valuation provision in lieu of any co-insurance clause, waiver of subrogation, and inflation guard protection causing an increase in the annual property insurance coverage amount by a factor of not less than the adjusted U.S. Department of Labor Consumer Price Index for All Urban Consumers for the city nearest to where the Premises are located. (b) RENTAL VALUE. Lessor shall also obtain and keep in force during the term of this Lease a policy or policies in the name of Lessor, with loss payable to Lessor and any Lender(s), insuring the loss of the full rental and other charges payable by all lessees of the Building to Lessor for one year (including all Real Property Taxes, insurance costs, all Operating Expenses and any scheduled rental increases). Said insurance may provide that in the event the Lease is terminated by reason of an insured loss, the period of indemnity for such coverage shall be extended beyond the date of the completion of repairs or replacement of the Premises, to provide for one full year's loss of rental revenues from the date of any such loss. Said insurance shall contain an agreed valuation provision in lieu of any co-insurance clause, and the amount of coverage shall be adjusted annually to reflect the projected rental income, Real Property Taxes, insurance premium costs and other expenses, if any, otherwise payable, for the next 12-month period. Operating Expenses shall include any deductible amount in the event of such loss. (c) ADJACENT PREMISES. Lessee shall pay for any increase in the premiums for the property insurance of the Building and for the Common Areas or other buildings in the Industrial Center if said increase is caused by Lessee's acts, omissions, use or occupancy of the Premises. (d) LESSEE'S IMPROVEMENTS. Since Lessor is the insuring Party, Lessor shall not be required to insure Lessee-Owned Alterations and Utility Installations unless the item in question has become the property of Lessor under the terms of this Lease. 8.4 LESSEE'S PROPERTY INSURANCE. Subject to the requirements of Paragraph 8.5, Lessee at its cost shall either by separate policy or, at Lessor's option, by endorsement to a policy already carried, maintain insurance coverage on all of Lessee's personal property, Trade Fixtures and Lessee-Owned Alterations and Utility Installations in, on, or about the Premises similar in coverage to that carried by Lessor as the Insuring Party under Paragraph 8.3(a). Such insurance shall be full replacement cost coverage with a deductible not to exceed $10,000.00 per occurrence. The proceeds from any such insurance shall be used by Lessee for the replacement of personal property and the restoration of Trade Fixtures and Lessee-Owned Alterations and Utility Installations. Upon request from Lessor, Lessee shall provide Lessor with written evidence that such insurance is in force. 8.5 INSURANCE POLICIES. Insurance required hereunder shall be in companies duly licensed to transact business in the state where the Premises are located, and maintaining during the policy term a "General Policyholders Rating" of at least B+, V, or such other rating as may be required by a Lender, as set forth in the most current issue of "Best's Insurance Guide." Lessee shall not do or permit to be done anything which shall invalidate the insurance policies referred to in this Paragraph 8. Lessee shall cause to be delivered to Lessor, within seven (7) days after the earlier of the Early Possession Date or the Commencement Date, certified copies of, or certificates evidencing the existence and amounts of, the insurance required under Paragraph 8.2(a) and 8.4. No such policy shall be cancelable or subject to modification except after thirty (30) days' prior written notice to Lessor. Lessee shall at least thirty (30) days prior to the expiration of such policies, furnish Lessor with evidence of renewals or "insurance binders" evidencing renewal thereof, or Lessor may order such insurance and charge the reasonable cost thereof to Lessee, which amount shall be payable by Lessee to Lessor upon demand. Initials: CM ---- KG ---- -4- 8.6 WAIVER OF SUBROGATION. Without affecting any other rights or remedies, Lessor and Lessee each hereby release and relieve the other, and waive their entire right to recover damages (whether in contract or in tort) against the other, for loss or damage to their property arising out of or incident to the perils required to be insured against under Paragraph 8. The effect of such releases and waivers of the right to recover damages shall not be limited by the amount of insurance carried or required, or by any deductibles applicable thereto. Lessor and Lessee agree to have their respective insurance companies issuing property damage insurance waive any right to subrogation that such companies may have against Lessor or Lessee, as the case may be, so long as the insurance is not invalidated thereby. 8.7 INDEMNITY. Except for Lessor's or Lessor's agents', employees', or contractors' negligence, willful misconduct and/or breach of this Lease, Lessee shall indemnify, protect, defend and hold harmless the Premises, Lessor and its agents, Lessor's master or ground lessor, partners and Lenders, from and against any and all claims, loss of rents and/or damages, costs, liens, judgments, penalties, loss of permits, attorneys' and consultants' fees, expenses and/or liabilities arising out of, involving, or in connection with, the occupancy of the Premises by Lessee, the conduct of Lessee's business, any act, omission or neglect of Lessee, its agents, contractors, employees or invitees, and out of any Default or Breach by Lessee in the performance in a timely manner of any obligation on Lessee's part to be performed under this Lease. The foregoing shall include, but not be limited to, the defense or pursuit of any claim or any action or proceeding involved therein, and whether or not (in the case of claims made against Lessor) litigated and/or reduced to judgment. In case any action or proceeding is brought against Lessor by reason of any of the foregoing matters, Lessee upon notice from Lessor, shall defend the same at Lessee's expense by counsel reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee in such defense. Lessor need not have first paid any such claim in order to be so indemnified. 8.8 EXEMPTION OF LESSOR FROM LIABILITY. Except for Lessor's negligence, gross negligence, willful misconduct and/or breach of this Lease Lessor shall not be liable for injury or damage to the person or goods, wares, merchandise or other property of Lessee, Lessee's employees, contractors, invitees, customers, or any other person in or about the Premises, whether such damage or injury is caused by or results from fire, steam, electricity, gas, water or rain, or from the breakage, leakage, obstruction or other defects of pipes, fire sprinklers, wires, appliances, plumbing, air conditioning or lighting fixtures, or from any other cause, whether said injury or damage results from conditions arising upon the Premises or upon other portions of the Building of which the Premises are a part, from other sources or places, and regardless of whether the cause of such damage or injury or the means of repairing the same is accessible or not. Lessor shall not be liable for any damages arising from any act or neglect of any other lessee of Lessor nor from the failure by Lessor to enforce the provisions of any other lease in the Industrial Center. 9. DAMAGE OR DESTRUCTION. 9.1 DEFINITIONS. (a) "PREMISES PARTIAL DAMAGE" shall mean damage or destruction to the Premises, other than Lessee-Owned Alterations and Utility Installations, the repair cost of which damage or destruction is less than fifty percent (50%) of the then Replacement Cost (as defined in Paragraph 9.1(d)) of the Premises (excluding Lessee-Owned Alterations and Utility Installations and Trade Fixtures) immediately prior to such damage or destruction. (b) "PREMISES TOTAL DESTRUCTION" shall mean damage or destruction to the Premises, other than Lessee-Owned Alterations and Utility Installations, the repair cost of which damage or destruction is fifty percent (50%) or more of the then Replacement Cost of the Premises (excluding Lessee Owned Alterations and Utility Installations and Trade Fixtures) immediately prior to such damage or destruction. In addition, damage or destruction to the Building, other than Lessee-Owned Alterations and Utility Installations and Trade Fixtures of any lessees of the Building, the cost of which damage or destruction is fifty percent (50%) or more of the then Replacement Cost (excluding Lessee-Owned Alterations and Utility Installations and Trade Fixtures of any lessees of the Building) of the Building shall, at the option of Lessor, be deemed to be Premises Total Destruction. (c) "INSURED LOSS" shall mean damage or destruction to the Premises, other than Lessee-Owned Alterations and Utility Installations and Trade Fixtures, which was caused by an event required to be covered by insurance described in Paragraph 8.3(a) irrespective of any deductible amounts or coverage limits involved. (d) "REPLACEMENT COST" shall mean the cost to repair or rebuild the improvements owned by Lessor at the time of the occurrence to their condition existing immediately prior thereto, including demolition, debris removal and upgrading required by the operation of applicable building codes, ordinances or laws, and without deduction for depreciation. (e) "HAZARDOUS SUBSTANCE CONDITION" shall mean the occurrence or discovery of a condition involving the presence of, or a contamination by, a Hazardous Substance as defined in Paragraph 6.2(a), in, on, or under the Premises. 9.2 PREMISES PARTIAL DAMAGE - INSURED LOSS. If Premises Partial Damage that is an Insured Loss occurs, then Lessor shall, at Lessor's expense, repair such damage (but not Lessee's Trade Fixtures or Lessee-Owned Alterations and Utility Installations) as soon as reasonably possible and this Lease shall continue in full force and effect. In the event however, that there is a shortage of insurance proceeds and such shortage is due to the fact that, by reason of the unique nature of the improvements in the Premises, full replacement cost insurance coverage was not commercially reasonable and available, Lessor shall have no obligation to pay for the shortage in insurance proceeds or to fully restore the unique aspects of the Premises unless Lessee provides Lessor with the funds to cover same, or adequate assurance thereof, within ten (10) days following receipt of written notice of such shortage and request therefor. If Lessor receives said funds or adequate assurance thereof within said ten (10) day period, Lessor shall complete them as soon as reasonably possible and this Lease shall remain in full force and effect. If Lessor does not receive such funds or assurance within said period, Lessor may nevertheless elect by written notice to Lessee within ten (10) days thereafter to make such restoration and repair as is commercially reasonable with Lessor paying any shortage in proceeds, in which case this Lease shall remain in full force and effect. If Lessor does not receive such funds or assurance within such ten (10) day period, and if Lessor does not so elect to restore and repair, then this Lease shall terminate sixty (60) following the occurrence of the damage or destruction. Unless otherwise agreed, Lessee shall in no event have any right to reimbursement from Lessor for any funds contributed by Lessee to repair any such damage or destruction. Premises Partial Damage due to flood or earthquake shall be subject to Paragraph 9.3 rather than Paragraph 9.2, notwithstanding that there may be some insurance coverage, but the net proceeds of any such insurance shall be made available for the repairs if made by either Party. 9.3 PARTIAL DAMAGE - UNINSURED LOSS. If Premises Partial Damage that is not an Insured Loss occurs, unless caused by a negligent or willful act of Lessee (in which event Lessee shall make the repairs at Lessee's expense and this Lease shall continue in full force and effect), Lessor may at Lessor's option, either (i) repair such damage as soon as reasonably possible at Lessor's expense, in which event this Lease shall continue in full force and effect, or (ii) give written notice to Lessee within thirty (30) days after receipt by Lessor of knowledge of the occurrence of such damage of Lessor's desire to terminate this Lease as of the date sixty (60) days following the date of such notice. In the event Lessor acts to give such notice of Lessor's intention to terminate this Lease, Lessee shall have the right within ten (10) days after the receipt of such notice to give written notice to Lessor of Lessee's commitment to pay for the repair of such damage totally at Lessee's expense and without reimbursement from Lessor. Lessee shall provide Lessor with the required funds or satisfactory assurance thereof within thirty (30) days following such commitment from Lessee. In such event this Lease shall continue in full force and effect, and Lessor shall proceed to make such repairs as soon as reasonably possible after the required funds are available. If Lessee does not give such notice and provide the funds or assurance thereof within the times specified above, this Lease shall terminate as of the date of the occurrence of such damage. 9.4 TOTAL DESTRUCTION. Notwithstanding any other provision hereof, if Premises Total Destruction occurs (including any destruction required by any authorized public authority), this Lease shall terminate as of the date of such Premises Total Destruction, whether or not the damage or destruction is an insured Loss or was caused by a negligent or willful act of Lessee. In the event, however, that the damage or destruction was caused by Lessee, Lessor shall have the right to recover Lessor's damages from Lessee except as released and waived in Paragraph 9.7. 9.5 DAMAGE NEAR END OF TERM. If at any time during the last twelve (12) months of the term of this Lease there is damage for which the cost to repair exceeds one month's Base Rent, whether or not an Insured Loss, either party may, terminate this Lease effective sixty (60) days following the date of occurrence of such damage by giving written notice to the other party of its election to do so within thirty (30) days after the date of occurrence of such damage. Provided, however, if Lessee at that time has an exercisable option to extend this Lease or to purchase the Premises, then Lessee may preserve this Lease by (a) exercising such option, and (b) providing Lessor with any shortage in insurance proceeds (or adequate assurance thereof) needed to make the repairs on or before the earlier of (i) the date which is ten (10) days after Lessee's receipt of Lessor's written notice purporting to terminate this Lease, or (ii) the day prior to the date upon which such option expires. If Lessee duly exercises such option during such period and provides Lessor with funds (or adequate assurance thereof) to cover any shortage in insurance proceeds, Lessor shall, at Lessor's expense repair such damage as soon as reasonably possible and this Lease shall continue in full force and effect. If Lessee fails to exercise such option and provide such funds or assurance during such period, then this Lease shall terminate as of the date set forth in the first sentence of this Paragraph 9.5. 9.6 ABATEMENT OF RENT; LESSEE'S REMEDIES. (a) In the event of (i) Premises Partial Damage or (ii) Hazardous Substance Condition for which Lessee is not legally responsible, the Base Rent, Operating Expenses and other charges, if any, payable by Lessee hereunder for the period during which such damage or condition, its repair, remediation or restoration continues, shall be abated in proportion to the degree to which Lessee's use of the Premises is impaired. Except for abatement of Base Rent, Operating Expenses and other charges, if any, as aforesaid, all other obligations of Lessee hereunder shall be performed by Lessee, and Lessee shall have no claim against Lessor for any damage suffered by reason of any such damage, destruction, repair, remediation or restoration except for damages due to Lessor's negligence, willful misconduct or breach of this Lease. (b) If Lessor shall be obligated to repair or restore the Premises under the provisions of this Paragraph 9 and shall not commence, in a substantial and meaningful way, the repair or restoration of the Premises within ninety (90) days after such obligation shall accrue, Lessee may, at any time prior to the commencement of such repair or restoration, give written notice to Lessor and to any Lenders of which Lessee has actual notice of Lessee's election to terminate this Lease on a date not less than sixty (60) days following the giving of such notice. If Lessee gives such notice to Lessor and such Lenders and such repair or restoration is not commenced within thirty (30) days after receipt of such notice, this Lease shall terminate as of the date specified in said notice. If Lessor or a Lender commences the repair or restoration of the Premises within thirty (30) days after the receipt of such notice, this Lease Initials: CM ---- KG ---- -5- shall continue in full force and effect. "COMMENCE" as used in this Paragraph 9.6 shall mean either the unconditional authorization of the preparation of the required plans, or the beginning of the actual work on the Premises, whichever occurs first. 9.7 HAZARDOUS SUBSTANCE CONDITIONS. If a Hazardous Substance Condition occurs, unless Lessee is legally responsible therefor (in which case Lessee shall make the investigation and remediation thereof required by Applicable Requirements and this Lease shall continue in full force and effect, but subject to Lessor's rights under Paragraph 6.2(c) and Paragraph 13), Lessor may, at Lessor's option either: (i) investigate and remediate such Hazardous Substance Condition, if required, as soon as reasonably possible at Lessor's expense, in which event this Lease shall continue in full force and effect, or (ii) if the estimated cost to investigate and remediate such condition exceeds twenty (20) times the then monthly Base Rent, give written notice to Lessee within thirty (30) days after receipt by Lessor of knowledge of the occurrence of such Hazardous Substance Condition of Lessor's desire to terminate this Lease as to the date sixty (60) days following the date of such notice. In the event Lessor elects to give such notice of Lessor's intention to terminate this Lease, Lessee shall have the right within ten (10) days after the receipt of such notice to give written notice to Lessor of Lessee's commitment to pay for the excess costs of (a) investigation and remediation of such Hazardous Substance Condition to the extent required by Applicable Requirements, over (b) an amount equal to twenty (20) times the then monthly Base Rent. Lessee shall provide Lessor with the funds required of Lessee or satisfactory assurance thereof within thirty (30) days following said commitment by Lessee. In such event this Lease shall continue in full force and effect, and Lessor shall proceed to make such investigation and remediation as soon as reasonably possible after the requiring funds are available. If Lessee does not give such notice and provide the required funds or assurance thereof within the time period specified above, this Lease shall terminate as of the date specified in Lessor's notice of termination. 9.8 TERMINATION - ADVANCE PAYMENTS. Upon termination of this Lease pursuant to this Paragraph 9, Lessor shall return to Lessee any advance payment made by Lessee to Lessor and so much of Lessee's Security Deposit as has not been, or is not then required to be, used by Lessor under the terms of this Lease. 9.9 WAIVER OF STATUTES. Lessor and Lessee agree that the terms of this Lease shall govern the effect of any damage to or destruction of the Premises and the Building with respect to the termination of this Lease and hereby waive the provisions of any present or future statute to the extent it is inconsistent herewith. 10. REAL PROPERTY TAXES. 10.1 PAYMENT OF TAXES. Lessor shall pay the Real Property Taxes, as defined in Paragraph 10.2, applicable to the Industrial Center, and except as otherwise provided in Paragraph 10.3, any such amounts shall be included in the calculation of Operating Expenses in accordance with the provisions of Paragraph 4.2. 10.2 REAL PROPERTY TAX DEFINITION. As used herein, the term "REAL PROPERTY TAXES" shall include any form of real estate tax or assessment, general, special, ordinary or extraordinary, and any license fee, commercial rental tax, improvement bond or bonds, levy or tax (other than inheritance, personal income or estate taxes) imposed upon the Industrial Center by any authority having the direct or indirect power to tax, including any city, state or federal government, or any school, agricultural, sanitary, fire, street, drainage, or other improvement district thereof, levied against any legal or equitable interest of Lessor in the Industrial Center or any portion thereof, Lessor's right to rent or other income therefrom, and/or Lessor's business of leasing the Premises. The term "REAL PROPERTY TAXES" shall also include any tax, fee, levy, assessment or charge, or any increase therein, imposed by reason of events occurring, or changes in Applicable Law taking effect, during the term of this Lease, including but not limited to a change in the ownership of the Industrial Center or in the improvements thereon, the execution of this Lease, or any modification, amendment or transfer thereof, and whether or not contemplated by the Parties. In calculating Real Property Taxes for any calendar year, the Real Property Taxes for any real estate tax year shall be included in the calculation of Real Property Taxes for such calendar year based upon the number of days which such calendar year and tax year have in common. Insert 10.2 10.3 ADDITIONAL IMPROVEMENTS. Operating Expenses shall not include Real Property Taxes specified in the tax assessor's records and work sheets as being caused by additional improvements placed upon the Industrial Center by Lessee or by Lessor for the exclusive enjoyment of such other lessees. Notwithstanding Paragraph 10.1 hereof, Lessee shall, however, pay to Lessor at the time Operating Expenses are payable under Paragraph 4.2, the entirety of any increase in Real Property Taxes if assessed solely by reason of Alterations, Trade Fixtures or Utility Installations placed upon the Premises by Lessee or at Lessee's request. 10.4 JOINT ASSESSMENT. If the Building is not separately assessed, Real Property Taxes allocated to the Building shall be an equitable proportion of the Real Property Taxes for all of the land and improvements included within the tax parcel assessed, such proportion to be determined by Lessor from the respective valuations assigned in the assessor's work sheets or such other information as may be reasonably available. Lessor's reasonable determination thereof, in good faith, shall be conclusive. 10.5 LESSEE'S PROPERTY TAXES. Subject to Lessee's right to contest the amount or application of such taxes Lessee shall pay prior to delinquency all taxes assessed against and levied upon Lessee-Owned Alterations and Utility Installations, Trade Fixtures, furnishings, equipment and all personal property of Lessee contained in the Premises or stored within the Industrial Center. When possible, Lessee shall cause its Lessee-Owned Alterations and Utility Installations, Trade Fixtures, furnishings, equipment and all other personal property to be assessed and billed separately from the real property of Lessor. If any of Lessee's said property shall be assessed with Lessor's real property, Lessee shall pay Lessor the taxes attributable to Lessee's property within ten (10) days after receipt of a written statement setting forth the taxes applicable to Lessee's property. 11. UTILITIES. Lessee shall pay directly for all utilities and services supplied to the Premises, including but not limited to electricity, telephone, security, gas and cleaning of the Premises, together with any taxes thereon. If any such utilities or services are not separately metered to the Premises or separately billed to the Premises, Lessee shall pay to Lessor a reasonable proportion to be determined by Lessor of all such charges jointly metered or billed with other premises in the Building, in the manner and within the time periods set forth in Paragraph 4.2(d). 12. ASSIGNMENT AND SUBLETTING. 12.1 LESSOR'S CONSENT REQUIRED. (a) Lessee shall not voluntarily or by operation of law assign, transfer, mortgage or otherwise transfer or encumber (collectively, "assign") or sublet all or any part of Lessee's interest in this Lease or in the Premises without Lessor's prior written consent given under and subject to the terms of Paragraph 36. (b) Insert 12.1(b) (d) An assignment or subletting of Lessee's interest in this Lease without Lessor's specific prior written consent shall, at Lessor's option, be a Default curable after notice per Paragraph 13.1, or a non-curable Breach without the necessity of any notice and grace period. If Lessor elects to treat such unconsented to assignment or subletting as a non-curable Breach, Lessor shall have the right to either: (i) terminate this Lease, or (ii) upon thirty (30) days' written notice ("LESSOR'S NOTICE"), increase the monthly Base Rent for the Premises to the greater of the then fair market rental value of the Premises, as reasonably determined by Lessor, or one hundred ten percent (110%) of the Base Rent then in effect. Pending determination of the new fair market rental value, if disputed by Lessee, Lessee shall pay the amount set forth in Lessor's Notice, with any overpayment credited against the next installment(s) of Base Rent coming due, and any underpayment for the period retroactively to the effective date of the adjustment being due and payable immediately upon the determination thereof. Further, in the event of such Breach and rental adjustment, (i) the purchase price of any option to purchase the Premises held by Lessee shall be subject to similar adjustment to the then fair market value as reasonably determined by Lessor (without the Lease being considered an encumbrance or any deduction for depreciation or obsolescence, and considering the Premises at its highest and best use and in good condition) or one hundred ten percent (110%) of the price previously in effect, (ii) any index-oriented rental or price adjustment formulas contained in this Lease shall be adjusted to require that the base index be determined with reference to the index applicable to the time of such adjustment, and (iii) any fixed rental adjustments scheduled during the remainder of the Lease term shall be increased in the same ratio as the new rental bears to the Base Rent in effect immediately prior to the adjustment specified in Lessor's Notice. (e) Lessee's remedy for any breach of this Paragraph 12.1 by Lessor shall be limited to compensatory damages and/or injunctive relief. 12.2 TERMS AND CONDITIONS APPLICABLE TO ASSIGNMENT AND SUBLETTING. (a) Regardless of Lessor's consent, any assignment or subletting shall not (i) be effective without the express written assumption by such assignee or sublessee of the obligations of Lessee under this Lease, (ii) release Lessee of any obligations hereunder, nor (iii) alter the primary liability of Lessee for the payment of Base Rent and other sums due Lessor hereunder or for the performance of any other obligations to be performed by Lessee under this Lease. (b) Lessor may accept any rent or performance of Lessee's obligations from any person other than Lessee pending approval or disapproval of an assignment. Neither a delay in the approval or disapproval of such assignment nor the acceptance of any rent for performance shall constitute a waiver or estoppel of Lessor's right to exercise its remedies for the Default or Breach by Lessee of any of the terms, covenants or conditions of this Lease. (c) The consent of Lessor to any assignment or subletting shall not constitute a consent to any subsequent assignment or subletting by Lessee or to any subsequent or successive assignment or subletting by the assignee or sublessee. However, Lessor may consent to subsequent sublettings and assignments of the sublease or any amendments or modifications thereto without notifying Lessee or anyone else liable under this Lease or the sublease and without obtaining their consent, and such action shall not relieve such persons from liability under this Lease or the sublease. (d) In the event of any Default or Breach of Lessee's obligation under this Lease, Lessor may proceed directly against Lessee, any Guarantors or anyone else responsible for the performance of the Lessee's obligations under this Lease, including any sublessee, without first exhausting Lessor's remedies against any other person or entity responsible therefor to Lessor, or any security held by Lessor. (e) Each request for consent to an assignment or subletting shall be in writing, accompanied by information relevant to Lessor's determination as to the financial and operational responsibility and appropriateness of the proposed assignee or sublessee, including but not limited to the Initials: CM ---- KG ---- -6- intended use and/or required modification of the Premises, if any, together with reimbursement of Lessor's legal fees and costs which shall not exceed $500.00. Lessee agrees to provide Lessor with such other or additional information and/or documentation as may be reasonably requested by Lessor. (f) Any assignee of, or sublessee under, this Lease shall, by reason of accepting such assignment or entering into such sublease, be deemed, for the benefit of Lessor, to have assumed and agreed to conform and comply with each and every term, covenant, condition and obligation herein to be observed or performed by Lessee during the term of said assignment or sublease, other than such obligations as are contrary to or inconsistent with provisions of an assignment or sublease to which Lessor has specifically consented in writing. 12.3 ADDITIONAL TERMS AND CONDITIONS APPLICABLE TO SUBLETTING. The following terms and conditions shall apply to any subletting by Lessee of all or any part of the Premises and shall be deemed included in all subleases under this Lease whether or not expressly incorporated therein: (a) Lessee hereby assigns and transfers to Lessor all of Lessee's interest in all rentals and income arising from any sublease of all or a portion of the Premises heretofore or hereafter made by Lessee, and Lessor may collect such rent and income and apply same toward Lessee's obligations under this Lease; provided, however, that until a Breach (as defined in Paragraph 13.1) shall occur in the performance of Lessee's obligations under this Lease, Lessee may, except as otherwise provided in this Lease, receive, collect and enjoy the rents accruing under such sublease. Lessor shall not, by reason of the foregoing provision or any other assignment of such sublease to Lessor, nor by reason of the collection of the rents from a sublessee, be deemed liable to the sublessee for any failure of Lessee to perform and comply with any of Lessee's obligations to such sublessee under such Sublease. Lessee hereby irrevocably authorizes and directs any such sublessee, upon receipt of a written notice from Lessor stating that a Breach exists in the performance of Lessee's obligations under this Lease, to pay to Lessor the rents and other charges due and to become due under the sublease. Sublessee shall rely upon any such statement and request from Lessor and shall pay such rents and other charges to Lessor without any obligation or right to inquire as to whether such Breach exists and notwithstanding any notice from or claim from Lessee to the contrary. Lessee shall have no right or claim against such sublessee, or, until the Breach has been cured, against Lessor, for any such rents and other charges so paid by said sublessee to Lessor. (b) In the event of a Breach by Lessee in the performance of its obligations under this Lease, Lessor, at its option and without any obligation to do so, may require any sublessee to attorn to Lessor, in which event Lessor shall undertake the obligations of the sublessor under such sublease from the time of the exercise of said option to the expiration of such sublease; provided, however, Lessor shall not be liable for any prepaid rents or security deposit paid by such sublessee to such sublessor or for any other prior defaults or breaches of such sublessor under such sublease. (c) Any matter or thing requiring the consent of the sublessor under a sublease shall also require the consent of Lessor herein. (d) No sublessee under a sublease approved by Lessor shall further assign or sublet all or any part of the Premises without Lessor's and Lessee's prior written consent. (e) Lessor shall deliver a copy of any notice of Default or Breach by Lessee to the sublessee, who shall have the right to cure the Default of Lessee within the grace period, if any, specified in such notice. The sublessee shall have a right of reimbursement and offset from and against Lessee for any such Defaults cured by the sublessee. Insert 12.3(f) 13. DEFAULT; BREACH; REMEDIES. 13.1 DEFAULT; BREACH. Lessor and Lessee agree that if an attorney is consulted by Lessor in connection with a Lessee Default or Breach (as hereinafter defined), Lessor may include the reasonable cost of such services and costs in said notice as rent due and payable to cure said default. A "DEFAULT" by Lessee is defined as a failure by Lessee to observe, comply with or perform any of the terms, covenants, conditions or rules applicable to Lessee under this Lease. A "BREACH" by Lessee is defined as the occurrence of any one or more of the following Defaults, and, where a grace period for cure after notice is specified herein, the failure by Lessee to cure such Default prior to the expiration of the applicable grace period, and shall entitle Lessor to pursue the remedies set forth in Paragraphs 13.2 and/or 13.3; (a) The vacating of the Premises without a Lessor authorized assignee or sublessee or without the intention to reoccupy same, or the abandonment of the Premises. (b) Except as expressly otherwise provided in this Lease, the failure by Lessee to make any payment of Base Rent, Lessee's Share of Operating Expenses, or any other monetary payment required to be made by Lessee hereunder within five (5) days of when due, the failure by Lessee to provide Lessor with reasonable evidence of insurance or surety bond required under this Lease, or the failure of Lessee to fulfill any obligation under this Lease which endangers or threatens life or property, where such failure continues for a period of seven (7) business days following written notice thereof by or on behalf of Lessor to Lessee. (c) Except as expressly otherwise provided in this Lease, the failure by Lessee to provide Lessor with reasonable written evidence (in duly executed original form, if applicable) of (i) compliance with Applicable Requirements per Paragraph 6.3, (ii) the inspection, maintenance and service contracts required under Paragraph 7.1(b), (iii) the rescission of an unauthorized assignment or subletting per Paragraph 12.1, (iv) a Tenancy Statement per Paragraphs 16 or 37, (v) the subordination or non-subordination of this Lease per Paragraph 30, (vi) the guaranty of the performance of Lessee's obligations under this Lease if required under Paragraphs 1.11 and 37, (vii) the execution of any document requested under Paragraph 42 (easements), or (viii) any other documentation or information which Lessor may reasonably require of Lessee under the terms of this lease, where any such failure continues for a period of ten (10) days following written notice by or on behalf of Lessor to Lessee. (d) A Default by Lessee as to the terms, covenants, conditions or provisions of this Lease, or of the rules adopted under Paragraph 40 hereof that are to be observed, complied with or performed by Lessee, other than those described in Subparagraphs 13.1(a), (b) or (c), above, where such Default continues for a period of thirty (30) days after written notice thereof by or on behalf of Lessor to Lessee; provided, however, that if the nature of Lessee's Default is such that more than thirty (30) days are reasonably required for its cure, then it shall not be deemed to be a Breach of this Lease by Lessee if Lessee commences such cure within said thirty (30) day period and thereafter diligently prosecutes such cure to completion. (e) The occurrence of any of the following events: (i) the making by Lessee of any general arrangement or assignment for the benefit of creditors; (ii) Lessee's becoming a "debtor" as defined in 11 U.S. Code Section 101 or any successor statute thereto (unless, in the case of a petition filed against Lessee, the same is dismissed within sixty (60) days); (iii) the appointment of a trustee or receiver to take possession of substantially all of Lessee's assets located at the Premises or of Lessee's interest in this Lease, where possession is not restored to Lessee within thirty (30) days; or (iv) the attachment, execution or other judicial seizure of substantially all of Lessee's assets located at the Premises or of Lessee's interest in this Lease, where such seizure is not discharged within thirty (30) days; provided, however, in the event that any provision of this Subparagraph 13.1(e) is contrary to any applicable law, such provision shall be of no force or effect, and shall not affect the validity of the remaining provisions. (f) The discovery by Lessor that any financial statement of Lessee or of any Guarantor, given to Lessor by Lessee or any Guarantor, was materially false without a reasonable explanation from Lessee for such error. 13.2 REMEDIES. If Lessee fails to perform any affirmative duty or obligation of Lessee under this Lease, within ten (10) days after written notice to Lessee (or in case of an emergency without notice), Lessor may at its option (but without obligation to do so) perform such duty or obligation on Lessee's behalf, including but not limited to the obtaining of reasonably required bonds, insurance policies, or governmental licenses, permits or approvals. The costs and expenses of any such performance by Lessor shall be due and payable by Lessee to Lessor upon invoice therefor. If any check given to Lessor by Lessee shall not be honored by the bank upon which it is drawn, Lessor, at its own option, may require all future payments for a period of one (1) calendar year to be made under this Lease by Lessee to be made only by cashier's check. In the event of a Breach of this Lease by Lessee (as defined in Paragraph 13.1), with or without further notice or demand, and without limiting Lessor in the exercise of any right or remedy which Lessor may have by reason of such Breach, Lessor may: (a) Terminate Lessee's right to possession of the Premises by any lawful means, in which case this Lease and the term hereof shall terminate and Lessee shall immediately surrender possession of the Premises to Lessor. In such event Lessor shall be entitled to recover from Lessee: (i) the worth at the time of the award of the unpaid rent which had been earned at the time of termination; (ii) the worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that the Lessee proves could have been reasonably avoided; (iii) the worth at the time of award of the amount by which the unpaid rent for the balance of the term after the time of award exceeds the amount of such rental loss that the Lessee proves could be reasonably avoided; and (iv) any other amount necessary to compensate Lessor for all the detriment proximately caused by the Lessee's failure to perform its obligations under this Lease or which in the ordinary course of things would be likely to result therefrom, including but not limited to the cost of recovering possession of the Premises, expenses of reletting, including necessary renovation and alteration of the Premises to the extent required by Paragraph 7.4(c), reasonable attorneys' fees, and that portion of any leasing commission paid by Lessor in connection with this Lease applicable to the unexpired term of this Lease. The worth at the time of award of the amount referred to in provision (iii) of the immediately preceding sentence shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco or the Federal Reserve Bank District in which the Premises are located at the time of award plus one percent (1%). Efforts by Lessor to mitigate damages caused by Lessee's Default or Breach of this Lease shall not waive Lessor's right to recover damages under this Paragraph 13.2. If termination of this Lease is obtained through the provisional remedy of unlawful detainer, Lessor shall have the right to recover in such proceeding the unpaid rent and damages as are recoverable therein, or Lessor may reserve the right to recover all or any part thereof in a separate suit for such rent and/or damages. If a notice and grace period required under Subparagraph 13.1(b), (c) or (d) was not previously given, a notice to pay rent or quit, or to perform or quit, as the case may be, given to Lessee under any statute authorizing the forfeiture of leases for unlawful detainer shall also constitute the applicable notice for grace period purposes required by Subparagraph 13.1(b),(c) or (d). In such case, the applicable grace period under the unlawful detainer statue shall run concurrently after the one such Initials: CM ---- KG ---- -7- statutory notice, and the failure of Lessee to cure the Default within the greater of the two (2) such grace periods shall constitute both an unlawful detainer and a Breach of this Lease entitling Lessor to the remedies provided for in this Lease and/or by said statute. (b) Continue the Lease and Lessee's right to possession (under California Civil Code Section 1951.4) after Lessee's Breach and recover the rent as it becomes due, provided Lessee has the right to sublet or assign, subject only to reasonable limitations. Lessor and Lessee agree that the limitations on assignment and subletting in this Lease are reasonable. Acts of maintenance or preservation, efforts to relet the Premises, or the appointment of a receiver to protect the Lessor's interest under this Lease, shall not constitute a termination of the Lessee's right to possession. (c) Pursue any other remedy now or hereafter available to Lessor under the laws or judicial decisions of the state wherein the Premises are located. (d) The expiration or termination of this Lease and/or the termination of Lessee's right to possession shall not relieve Lessee from liability under any indemnity provisions of this Lease as to matters occurring or accruing during the term hereof or by reason of Lessee's occupancy of the Premises. 13.3 13.4 LATE CHARGES. Lessee hereby acknowledges that late payment by Lessee to Lessor of rent and other sums due hereunder will cause Lessor to incur costs not contemplated by this Lease, the exact amount of which will be extremely difficult to ascertain. Such costs include, but are not limited to, processing and accounting charges, and late charges which may be imposed upon Lessor by the terms of any ground lease, mortgage or deed of trust covering the Premises. Accordingly, if any installment of rent or other sum due from Lessee shall not be received by Lessor or Lessor's designee within ten (10) days after such amount shall be due, then, without any requirement for notice to Lessee, Lessee shall pay to Lessor a late charge equal to six percent (6%) of such overdue amount. The parties hereby agree that such late charge represents a fair and reasonable estimate of the costs Lessor will incur by reason of late payment by Lessee. Acceptance of such late charge by Lessor shall in no event constitute a waiver of Lessee's Default or Breach with respect to such overdue amount, nor prevent Lessor from exercising any of the other rights and remedies granted hereunder. 13.5 BREACH BY LESSOR. Lessor shall not be deemed in breach of this Lease unless Lessor fails within a reasonable time to perform an obligation required to be performed by Lessor. For purposes of this Paragraph 13.5, a reasonable time shall in no event be less than thirty (30) days after receipt by Lessor, and by any Lender(s) whose name and address shall have been furnished to Lessee in writing for such purpose, of written notice specifying wherein such obligation of Lessor has not been performed; provided, however that if the nature of Lessor's obligation is such that more than thirty (30) days after such notice are reasonably required for its performance, then Lessor shall not be in breach of this Lease if performance is commenced within such thirty (30) day period and thereafter diligently pursued to completion. 14. CONDEMNATION. If the Premises or any portion thereof are taken under the power of eminent domain or sold under the threat of the exercise of said power (all of which are herein called "condemnation"), this Lease shall terminate as to the part so taken as of the date the condemning authority takes title or possession, whichever first occurs. If Lessee's business is materially affected or more than ten percent (10%) of the floor area of the Premises, or more than twenty-five percent (25%) of the portion of the Common Areas designated for Lessee's parking is taken by condemnation, or Lessee may elect to continue this Lease with Base Rent abated in proportion to the adverse effect of the condemnation on Lessee's business in the Premises, as reasonably determined by Lessee and Lessor. Lessee may, at Lessee's option, to be exercised in writing within ten (10) days after Lessor shall have given Lessee written notice of such taking (or in the absence of such notice, within ten (10) days after the condemning authority shall have taken possession) terminate this Lease as of the date the condemning authority takes such possession. If Lessee does not terminate this Lease in accordance with the foregoing, this Lease shall remain in full force and effect as to the portion of the Premises remaining, except that the Base Rent shall be reduced in the same proportion as the rentable floor area of the Premises taken bears to the total rentable floor area of the Premises. No reduction of Base Rent shall occur if the condemnation does not apply to any portion of the Premises. Any award for the taking of all or any part of the Premises under the power of eminent domain or any payment made under threat of the exercise of such power shall be the property of Lessor, whether such award shall be made as compensation for diminution of value of the leasehold or for the taking of the fee, or as severance damages; provided, however, that Lessee shall be entitled to any compensation, separately awarded to Lessee for Lessee's relocation expenses and/or attributable to loss of Lessee's Trade Fixtures and any Lessee owned Alterations and/or Utility Installations which Lessee would be entitled to remove on expiration or earlier termination of this Lease. In the event that this Lease is not terminated by reason of such condemnation, Lessor shall to the extent of its net severance damages received, over and above Lessee's Share of the legal and other expenses incurred by Lessor in the condemnation matter, repair any damage to the Premises caused by such condemnation authority. Lessee shall be responsible for the payment of any amount in excess of such net severance damages required to complete such repair. 15. BROKERS' FEES. 15.1 15.2 15.4 REPRESENTATIONS AND WARRANTIES. Lessee and Lessor each represent and warrant to the other that it has had no dealings with any person, firm, broker or finder other than as named in Paragraph 1.10(a) in connection with the negotiation of this Lease and/or the consummation of the transaction contemplated hereby, and that no broker or other person, firm or entity other than said named Broker(s) is entitled to any commission or finder's fee in connection with said transaction. Lessee and Lessor do each hereby agree to indemnify, protect, defend and hold the other harmless from and against liability for compensation or charges which may be claimed by any such unnamed broker, finder or other similar party by reason of any dealings or actions of the indemnifying Party, including any costs, expenses, and/or attorneys' fees reasonably incurred with respect thereto. 16. TENANCY AND FINANCIAL STATEMENTS. 16.1 TENANCY STATEMENT. Each Party (as "RESPONDING PARTY") shall within ten (10) days after written notice from the other Party (the "REQUESTING PARTY") execute, acknowledge and deliver to the Requesting Party a statement in writing in a form similar to the then most current "TENANCY STATEMENT" form published by the American Industrial Real Estate Association, plus such additional information, confirmation and/or statements as may be reasonably requested by the Requesting Party. 16.2 FINANCIAL STATEMENT. If Lessor desires to finance, refinance, or sell the Premises or the Building, or any part thereof, Lessee and all Guarantors shall deliver to any potential lender or purchaser designated by Lessor such financial statements of Lessee and such Guarantors as may be reasonably required by such lender or purchaser, including but not limited to Lessee's financial statements for the past three (3) years. All such financial statements shall be received by Lessor and such lender or purchaser in confidence and shall be used only for the purposes herein set forth. 17. LESSOR'S LIABILITY. The term "LESSOR" as used herein shall mean the owner or owners at the time in question of the fee title to the Premises. In the event of a transfer of Lessor's title or interest in the Premises or in this Lease, Lessor shall deliver to the transferee or assignee (in cash or by credit) any unused Security Deposit held by Lessor at the time of such transfer or assignment. Except as provided in Paragraph 15.3, upon such transfer or assignment and delivery of the Security Deposit, as aforesaid, the prior Lessor shall be relieved of all liability with respect to the obligations and/or covenants under this Lease thereafter to be performed by the Lessor. Subject to the foregoing, the obligations and/or covenants in this Lease to be performed by the Lessor shall be binding only upon the Lessor as hereinabove defined. Insert 17 18. SEVERABILITY. The invalidity of any provision of this Lease, as determined by a court of competent jurisdiction, shall in no way affect the validity of any other provision hereof. 19. INTEREST ON PAST-DUE OBLIGATIONS. Any monetary payment due Lessor hereunder, other than late charges, not received by Lessor within ten (10) days following the date on which it was due, shall bear interest from the date due at the prime rate charged by the largest state chartered bank in the state in which the Premises are located plus four percent (4%) per annum, but not exceeding the maximum rate allowed by law, in addition to the potential late charge provided for in Paragraph 13.4. 20. TIME OF ESSENCE. Time is of the essence with respect to the performance of all obligations to be performed or observed by the Parties under this Lease. 21. RENT DEFINED. All monetary obligations of Lessee to Lessor under the terms of this Lease are deemed to be rent with the exception of unused portion of the Security Deposit. 22. NO PRIOR OR OTHER AGREEMENTS; BROKER DISCLAIMER. This Lease contains all agreements between the Parties with respect to any matter mentioned herein, and no other prior or contemporaneous agreement or understanding shall be effective. Lessor and Lessee each represents and warrants to the Brokers that it has made, and is relying solely upon, its own investigation as to the nature, quality, character and financial responsibility of the other Party to this Lease and as to the nature, quality and character of the Premises. Brokers have no responsibility with respect thereto or with respect to any default or breach hereof by either Party. Each Broker shall be an intended third party beneficiary of the provisions of this Paragraph 22. 23. NOTICES. 23.1 NOTICE REQUIREMENTS. All notices required or permitted by this Lease shall be in writing and may be delivered in person (by hand or by messenger or courier service) or may be sent by regular, certified or registered mail or U.S. Postal Service Express Mail, with postage prepaid, or by facsimile transmission during normal business hours, and shall be deemed sufficiently given if served in a manner specified in this Paragraph 23. The addresses noted adjacent to a Party's signature on this Lease shall be that Party's address for delivery or mailing of notice purposes. Either Party may by written notice to the other specify a different address for notice purposes, except that upon Lessee's taking possession of the Premises, the Premises shall constitute Lessee's address for the purpose of mailing or delivering notices to Lessee. A copy of all notices required or permitted to be given to either hereunder shall be concurrently transmitted to such party or parties at such addresses as such party may from time to time hereafter designate by written notice to Lessee. 23.2 DATE OF NOTICE. Any notice sent by registered or certified mail, return receipt requested, shall be deemed given on the date of delivery shown on the receipt card, or if no delivery date is shown, the postmark thereon. If sent by regular mail, the notice shall be deemed given seventy-two (72) hours after Initials: CM ---- KG ---- -8- the same is addressed as required herein and mailed with postage prepaid. Notices delivered by United States Express Mail or overnight courier that guarantees next day delivery shall be deemed given twenty-four (24) hours after delivery of the same to the United States Postal Service or courier. If any notice is transmitted by facsimile transmission or similar means, the same shall be deemed served or delivered upon telephone or facsimile confirmation of receipt of the transmission thereof, provided a copy is also delivered via delivery or mail. If notice is received on a Saturday or a Sunday or a legal holiday, it shall be deemed received on the next business day. 24. WAIVERS. No waiver by Lessor of the Default or Breach of any term, covenant or condition hereof by Lessee, shall be deemed a waiver of any other term, covenant or condition hereof, or of any subsequent Default or Breach by Lessee of the same or any other term, covenant or condition hereof. Lessor's consent to, or approval of, any such act shall not be deemed to render unnecessary the obtaining of Lessor's consent to, or approval of, any subsequent or similar act by Lessee, or be construed as the basis of an estoppel to enforce the provision or provisions of this Lease requiring such consent. Regardless of Lessor's knowledge of a Default or Breach at the time of accepting rent, the acceptance of rent by Lessor shall not be a waiver of any Default or Breach by Lessee of any provision hereof. Any payment given Lessor by Lessee may be accepted by Lessor on account of moneys or damages due Lessor, notwithstanding any qualifying statements or conditions made by Lessee in connection therewith, which such statements and/or conditions shall be of no force or effect whatsoever unless specifically agreed to in writing by Lessor at or before the time of deposit of such payment. 25. RECORDING. Either Lessor or Lessee shall, upon request of the other, execute, acknowledge and deliver to the other a short form memorandum of this Lease for recording purposes. The Party requesting recordation shall be responsible for payment of any fees or taxes applicable thereto. 26. NO RIGHT TO HOLDOVER. Lessee has no right to retain possession of the Premises or any part thereof beyond the expiration or earlier termination of this Lease. In the event that Lessee holds over in violation of this Paragraph 26 then the Base Rent payable from and after the time of the expiration or earlier termination of this Lease shall be increased to one hundred fifty percent (150%) of the Base Rent applicable during the month immediately preceding such expiration or earlier termination. Nothing contained herein shall be construed as a consent by Lessor to any holding over by Lessee. 27. CUMULATIVE REMEDIES. No remedy or election hereunder shall be deemed exclusive but shall, wherever possible, be cumulative with all other remedies at law or in equity. 28. COVENANTS AND CONDITIONS. All provisions of this Lease to be observed or performed by Lessor or Lessee are both covenants and conditions. 29. BINDING EFFECT; CHOICE OF LAW. This Lease shall be binding upon the Parties, their personal representatives, successors and assigns and be governed by the laws of the State in which the Premises are located. Any litigation between the Parties hereto concerning this Lease shall be initiated in the county in which the Premises are located. 30. SUBORDINATION; ATTORNMENT; NON-DISTURBANCE. 30.1 SUBORDINATION. This Lease and any Option granted hereby shall be subject and subordinate to any ground lease, mortgage, deed of trust, or other hypothecation or security device (collectively, "SECURITY DEVICE"), now or hereafter placed by Lessor upon the real property of which the Premises are a part, to any and all advances made on the security thereof, and to all renewals, modifications, consolidations, replacements and extensions thereof. Lessee agrees that the Lenders holding any such Security Device shall have no duty, liability or obligation to perform any of the obligations of Lessor under this Lease, but that in the event of Lessor's default with respect to any such obligation, Lessee will give any Lender whose name and address have been furnished Lessee in writing for such purpose notice of Lessor's default pursuant to Paragraph 13.5. If any Lender shall elect to have this Lease and/or any Option granted hereby superior to the lien of its Security Device and shall give written notice thereof to Lessee, this Lease and such Options shall be deemed prior to such Security Device, notwithstanding the relative dates of the documentation or recordation thereof. 30.2 ATTORNMENT. Subject to the non-disturbance provisions of Paragraph 30.3, Lessee agrees to attorn to a Lender or any other party who acquires ownership of the Premises by reason of a foreclosure of a Security Device, and that in the event of such foreclosure, such new owner shall not: (i) be liable for any act or omission of any prior lessor or with respect to events occurring prior to acquisition of ownership, (ii) be subject to any offsets or defenses which Lessee might have against any prior lessor, or (iii) be bound by prepayment of more than one month's rent. 30.3 NON-DISTURBANCE. With respect to Security Devices entered into by Lessor after the execution of this lease, Lessee's subordination of this Lease shall be subject to receiving assurance (a "non-disturbance agreement") in a form reasonably acceptable to Lessee from the Lender that Lessee's possession and this Lease, including any options to extend the term hereof, will not be disturbed so long as Lessee is not in Breach hereof and attorns to the record owner of the Premises. 30.4 SELF-EXECUTING. The agreements contained in this Paragraph 30 shall be effective without the execution of any further documents; provided, however, that upon written request from Lessor or a Lender in connection with a sale, financing or refinancing of Premises, Lessee and Lessor shall execute such further writings as may be reasonably required to separately document any such subordination or non subordination, attornment and/or non-disturbance agreement as is provided for herein. 31. ATTORNEYS' FEES. If any Party or Broker brings an action or proceeding to enforce the terms hereof or declare rights hereunder, the Prevailing Party (as hereafter defined) in any such proceeding, action, or appeal thereon, shall be entitled to reasonable attorneys' fees. Such fees may be awarded in the same suit or recovered in a separate suit, whether or not such action or proceeding is pursued to decision or judgment. The term "PREVAILING PARTY" shall include, without limitation, a Party or Broker who substantially obtains or defeats the relief sought, as the case may be, whether by compromise, settlement, judgment, or the abandonment by the other Party or Broker of its claim or defense. The attorneys' fee award shall not be computed in accordance with any court fee schedule, but shall be such as to fully reimburse all reasonable attorneys' fees incurred. Lessor shall be entitled to attorneys' fees, costs and expenses incurred in preparation and service of notices of Default and consultations in connection therewith, whether or not a legal action is subsequently commenced in connection with such Default or resulting Breach, Broker(s) shall be intended third party beneficiaries of this Paragraph 31. 32. LESSOR'S ACCESS; SHOWING PREMISES; REPAIRS. Lessor and Lessor's agents shall have the right to enter the Premises at any time, in the case of an emergency, and otherwise at reasonable times upon 24 hours' prior notice for the purpose of showing the same to prospective purchasers, lenders, or lessees during the last 8 months of the lease term, and making such alterations, repairs, improvements or additions to the Premises or to the Building, as Lessor may reasonably deem necessary. Lessor may at any time place on or about the Premises or Building any ordinary "For Sale" signs and Lessor may at any time during the last one hundred eighty (180) days of the term hereof place on or about the Premises any ordinary "For Lease" signs. All such activities of Lessor shall be without abatement of rent or liability to Lessee. 33. AUCTIONS. Lessee shall not conduct, nor permit to be conducted, either voluntarily or involuntarily, any auction upon the Premises without first having obtained Lessor's prior written consent. Notwithstanding anything to the contrary in this Lease, Lessor shall not be obligated to exercise any standard of reasonableness in determining whether to grant such consent. 34. SIGNS. Lessee shall not place any sign upon the exterior of the Premises or the Building, except that Lessee may, with Lessor's prior written consent, install (but not on the Building) such signs as are reasonably required to advertise Lessee's own business so long as such signs are in a location designated by Lessor and comply with Applicable Requirements and such signage criteria established for the Industrial Center by Lessor. The installation of any sign on the Premises by or for Lessee shall be subject to the provisions of Paragraph 7 (Maintenance, Repairs, Utility Installations, Trade Fixtures and Alterations). Unless otherwise expressly agreed herein, Lessor reserves air rights to the use of the roof of the Building. 35. TERMINATION; MERGER. Unless specifically stated otherwise in writing by Lessor, the voluntary or other surrender of this Lease by Lessee, the mutual termination or cancellation hereof, or a termination hereof by Lessor for Breach by Lessee, shall automatically terminate any sublease or lesser estate in the Premises; provided, however, Lessor shall, in the event of any such surrender, termination or cancellation, have the option to continue any one or all of any existing subtenancies. Lessor's failure within ten (10) days following any such event to make a written election to the contrary by written notice to the holder of any such lesser interest, shall constitute Lessor's election to have such event constitute the termination of such interest. 36. CONSENTS. (a) Except for Paragraph 33 hereof (Auctions) or as otherwise provided herein, wherever in this Lease the consent of a Party is required to an act by or for the other Party, such consent shall not be unreasonably withheld or delayed. Lessee's actual reasonable costs and expenses (including but not limited to architects', attorneys', engineers' and other consultants' fees) incurred in the consideration of, or response to, a request by Lessee for any Lessor consent pertaining to this Lease or the Premises, including but not limited to consents to an assignment a subletting or the presence or use of a Hazardous Substance, shall be paid by Lessee to Lessor upon receipt of an invoice and supporting documentation therefor. In addition to the deposit described in Paragraph 12.2(e), Lessor may, as a condition to considering any such request by Lessee, require that Lessee deposit with Lessor an amount of money (in addition to the Security Deposit held under Paragraph 5) reasonably calculated by Lessor to represent the cost Lessor will incur in considering and responding to Lessee's request. Any unused portion of said deposit shall be refunded to Lessee without interest. Lessor's consent to any act, assignment of this Lease or subletting of the Premises by Lessee shall not constitute an acknowledgment that no Default or Breach by Lessee of this Lease exists, nor shall such consent be deemed a waiver of any then existing Default or Breach, except as may be otherwise specifically stated in writing by Lessor at the time of such consent. (b) All conditions to Lessor's consent authorized by this Lease are acknowledged by Lessee as being reasonable. The failure to specify herein any particular condition to Lessor's consent shall not preclude the impositions by Lessor at the time of consent of such further or other conditions as are then reasonable with reference to the particular matter for which consent is being given. 37. GUARANTOR. 37.1 Initials: CM ---- KG ---- -9- 38. QUIET POSSESSION. Upon payment by Lessee of the rent for the Premises and the performance of all of the covenants, conditions and provisions on Lessee's part to be observed and performed under this Lease, Lessee shall have quiet possession of the Premises for the entire term hereof subject to all of the provisions of this Lease. 39. OPTIONS. 39.1 DEFINITION. As used in this Lease, the word "Option" has the following meaning: (a) the right to extend the term of this Lease or to renew this Lease or to extend or renew any lease that Lessee has on other property of Lessor; (b) the right of first refusal to lease the Premises or the right of first offer to lease the Premises or the right of first refusal to lease other property of Lessor or the right of first offer to lease other property of Lessor; (c) the right to purchase the Premises, or the right of first refusal to purchase the Premises, or the right of first offer to purchase the Premises, or the right to purchase other property of Lessor, or the right of first refusal to purchase other property of Lessor, or the right of first offer to purchase other property of Lessor. 39.2 OPTIONS PERSONAL TO ORIGINAL LESSEE. Each Option granted to Lessee in this Lease is personal to the original Lessee named in Paragraph 1.1 hereof, and cannot be voluntarily or involuntarily assigned or exercised by any person or entity other than said original Lessee while the original Lessee is in full and actual possession of the Premises and without the intention of thereafter assigning or subletting. The Options, if any, herein granted to Lessee are not assignable, either as a part of an assignment of this Lease or separately or apart therefrom, and no Option may be separated from this Lease in any manner, by reservation or otherwise. 39.3 MULTIPLE OPTIONS. In the event that Lessee has any multiple Options to extend or renew this Lease, a later option cannot be exercised unless the prior Options to extend or renew this Lease have been validly exercised. 39.4 EFFECT OF DEFAULT ON OPTIONS. (a) Lessee shall have no right to exercise an Option, notwithstanding any provision in the grant of Option to the contrary: (i) during the period commencing with the giving of any notice of Default under Paragraph 13.1 and continuing until the noticed Default is cured, or (ii) during the period of time any monetary obligation due Lessor from Lessee is unpaid (without regard to whether notice thereof is given Lessee), or (iii) during the time Lessee is in Breach of this Lease, or (iv) in the event that Lessor has given three (3) or more notices of separate Defaults under Paragraph 13.1 three (3) or more times during the twelve (12) month period immediately preceding the exercise of the Option, whether or not the Defaults are cured. (b) The period of time within which an Option may be exercised shall not be extended or enlarged by reason of Lessee's inability to exercise an Option because of the provisions of Paragraph 39.4(a). (c) All rights of Lessee under the provisions of an Option shall terminate and be of no further force or effect, notwithstanding Lessee's due and timely exercise of the Option if after such exercise and during the term of this Lease, (i) Lessee fails to pay to Lessor a monetary obligation of Lessee for a period of thirty (30) days after such obligation becomes due, or (ii) Lessor gives to Lessee three (3) or more notices of separate Defaults under Paragraph 13.1 three (3) or more times during any twelve (12) month period, whether or not the Defaults are cured, or (iii) if Lessee commits a Breach of this Lease. 40. RULES AND REGULATIONS. Lessee agrees that it will abide by, and keep and observe all reasonable and non-discriminatory rules and regulations ("Rules and Regulations") which Lessor may make from time to time for the management, safety, care, and cleanliness of the grounds, the parking and unloading of vehicles and the preservation of good order, as well as for the convenience of other occupants or tenants of the Building and the Industrial Center and their invitees. See attached Exhibit "C". 41. SECURITY MEASURES. Lessee hereby acknowledges that the rental payable to Lessor hereunder does not include the cost of guard service or other security measures, and that Lessor shall have no obligation whatsoever to provide same. Lessee assumes all responsibility for the protection of the Premises, Lessee, its agents and invitees and their property against the acts of third parties. 42. RESERVATIONS. Lessor reserves the right, from time to time, to grant, without the consent or joinder of Lessee, such easements, rights of way, utility raceways, and dedications that Lessor deems necessary, and to cause the recordation of parcel maps and restrictions, so long as such easements, rights of way, utility raceways, dedications, maps and restrictions do not reasonably interfere with the use of the Premises by Lessee. Lessee agrees to sign any documents reasonably requested by Lessor to effectuate any such easement rights, dedication, map or restrictions. 43. PERFORMANCE UNDER PROTEST. If at any time a dispute shall arise as to any amount or sum of money to be paid by one Party to the other under the provisions hereof, the Party against whom the obligation to pay the money is asserted shall have the right to make payment "under protest" and such payment shall not be regarded as a voluntary payment and there shall survive the right on the part of said Party to institute suit for recovery of such sum. If it shall be adjudged that there was no legal obligation on the part of said Party to pay such sum or any part thereof, said Party shall be entitled to recover such sum or so much thereof as it was not legally required to pay under the provisions of this Lease together with reasonable fees incurred in the recovery of such costs. 44. AUTHORITY. If either Party hereto is a corporation, trust, or general or limited partnership, each individual executing this Lease on behalf of such entity represents and warrants that he or she is duly authorized to execute and deliver this Lease on its behalf. If Lessee is a corporation, trust or partnership, Lessee shall, within thirty (30) days after request by Lessor, deliver to Lessor evidence satisfactory to Lessor of such authority. 45. CONFLICT. Any conflict between the printed provisions of this Lease and the typewritten or handwritten provisions shall be controlled by the typewritten or handwritten provisions. 46. OFFER. Preparation of this Lease by either Lessor or Lessee or Lessor's agent or Lessee's agent and submission of same to Lessee or Lessor shall not be deemed an offer to lease. This Lease is not intended to be binding until executed and delivered by all Parties hereto. 47. AMENDMENTS. This Lease may be modified only in writing signed by the parties in interest at the time of the modification. The Parties shall amend this Lease from time to time to reflect any adjustments that are made to the Base Rent or other rent payable under this Lease. As long as they do not materially change Lessee's obligations hereunder, Lessee agrees to make such reasonable non-monetary modifications to this Lease as may be reasonably required by an institutional insurance company or pension plan Lender in connection with the obtaining of normal financing or refinancing of the property of which the Premises are a part. 48. MULTIPLE PARTIES. Except as otherwise expressly provided herein, if more than one person or entity is named herein as either Lessor or Lessee, the obligations of such multiple parties shall be the joint and several responsibility of all persons or entities named herein as such Lessor or Lessee. Initials: CM ---- KG ---- -10- LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE PREMISES. IF THIS LEASE HAS BEEN FILLED IN, IT HAS BEEN PREPARED FOR YOUR ATTORNEY'S REVIEW AND APPROVAL. FURTHER, EXPERTS SHOULD BE CONSULTED TO EVALUATE THE CONDITION OF THE PROPERTY FOR THE POSSIBLE PRESENCE OF ASBESTOS, UNDERGROUND STORAGE TANKS OR HAZARDOUS SUBSTANCES. NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION OR BY THE REAL ESTATE BROKERS OR THEIR CONTRACTORS, AGENTS OR EMPLOYEES AS TO THE LEGAL SUFFICIENCY, LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION TO WHICH IT RELATES; THE PARTIES SHALL RELY SOLELY UPON THE ADVICE OF THEIR OWN COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE. IF THE SUBJECT PROPERTY IS IN A STATE OTHER THAN CALIFORNIA, AN ATTORNEY FROM THE STATE WHERE THE PROPERTY IS LOCATED SHOULD BE CONSULTED. The parties hereto have executed this Lease at the place and on the dates specified above their respective signatures. Executed at: San Diego, California Executed at: San Diego, California ----------------------------------------------- ----------------------------------------------- on: 1/31/99 on: 1/31/99 --------------------------------------------------------- -------------------------------------------------------- By LESSOR: By LESSEE: COMPS Plaza Associates, L.P. COMPS.COM, INC., a Delaware corporation - ------------------------------------------------------------ ------------------------------------------------------------ By: Alden Properties, Inc., a California corporation - ------------------------------------------------------------ ------------------------------------------------------------ By: /s/ CHRISTOPHER S. McKELLAR By: /s/ KAREN GOODRUM - ------------------------------------------------------------ ------------------------------------------------------------ Name Printed: Christopher S. McKellar Name Printed: Karen Goodrum ---------------------------------------------- ---------------------------------------------- Title: Vice President Title: Chief Financial Officer ----------------------------------------------------- ----------------------------------------------------- By: ________________________________________________________ By: ________________________________________________________ Name Printed: ______________________________________________ Name Printed: ______________________________________________ Title: _____________________________________________________ Title: _____________________________________________________ Address: 12526 High Bluff Dr., Suite 100 Address: 9888 Carroll Center Road, #100 --------------------------------------------------- --------------------------------------------------- San Diego, CA 92130 San Diego, CA 92126 - ------------------------------------------------------------ ------------------------------------------------------------ Telephone: (619) 793-2622 Telephone: (619) 578-3000 ------------------------------------------- ------------------------------------------- Facsimile: (619) 793-7616 Facsimile: (619) 684-3288 ------------------------------------------- -------------------------------------------
NOTE: These forms are often modified to meet changing requirements of law and needs of the industry. Always write or call to make sure you are utilizing the most current form: AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION, 345 So. Figueroa St., M-1, Los Angeles, CA 90071, (213) 687-8777. (C) 1993 by American Industrial Real Estate Association All rights reserved. No part of these words may be reproduced in any form without permission in writing. Initials: CM ---- KG ---- -11- Exhibit A Outline of Floor Plan of Premises First Floor Initials: CM ---- KG ---- A-1 Exhibit A Outline of Floor Plan of Premises Second Floor Initials: CM ---- KG ---- A-2 EXHIBIT B TENANT IMPROVEMENT AGREEMENT ---------------------------- 1. TENANT IMPROVEMENTS. Lessee shall cause to be performed the ------------------- improvements (the "Tenant Improvements") in the Premises in accordance with ------------------- plans and specifications approved by Lessee and Lessor (the "Plans"), which ----- approvals shall not be unreasonably withheld or delayed. The Tenant Improvements shall be performed at the Lessee's cost, subject to the Lessor's Contribution (hereinafter defined). Lessee shall cause the Plans to be prepared by a registered professional architect and engineer acceptable to Lessor and Lessee. Lessee shall furnish the initial draft of the Plans to Lessor for Lessor's review and approval. Lessor shall within two (2) weeks after receipt either provide comments to such Plans or approve the same. Lessor shall be deemed to have approved such Plans if it does not timely provide comments on such Plans. If Lessor provides Lessee with comments to the initial draft of the Plans, Lessee shall provide revised Plans to Lessor incorporating Lessor's comments within one week after receipt of Lessor's comments. Lessor shall within one week after receipt then either provide comments to such revised Plans or approve such Plans. Lessor shall be deemed to have approved such revised Plans if Lessor does not timely provide comments on such Plans. The process described above shall be repeated, if necessary, until the Plans have been finally approved by Lessor. Lessee hereby agrees that the Plans for the Tenant Improvements shall comply with all Applicable Laws. Lessor's approval of any of the Plans (or any modifications or changes thereto) shall not impose upon Lessor or its agents or representatives any obligation with respect to the design of the Tenant Improvements or the compliance of such Tenant Improvements or the Plans with Applicable Laws. A contractor acceptable to Lessor and Lessee ("Contractor") ---------- shall perform the construction of the Tenant Improvements. Lessee shall enter into a contract with Contractor for the construction of the Tenant Improvements. 2. CHANGE ORDERS. If, prior to the Commencement Date, Lessee shall ------------- require improvements or changes (individually or collectively, "Change Orders") ------------- to the Premises in addition to, revision of or substitution for the Tenant Improvements, Lessee shall deliver to Lessor for its approval plans and specifications for such Change Orders. If Lessor does not approve of the plans for Change Orders, Lessor shall advise Lessee of the revisions required. Lessee shall revise and redeliver the plans and specifications to Lessor within five (5) business days of Lessor's advice or Lessee shall be deemed to have abandoned its request for such Change Orders. Lessee shall pay for all preparations and revisions of plans and specifications, and the construction of all Change Orders, subject to Lessor's Contribution. 3. CONTRIBUTION. Lessor shall contribute an amount up to $2.00 per ------------ rentable square foot for previously improved space and $22.00 per rentable square foot for Suite 236 (not previously improved) ("Lessor's Contribution") --------------------- toward the costs incurred for the Tenant Improvements and Change Orders. Lessor's contribution to be made upon Substantial Completion as defined in Section 4 of this Agreement. Lessor has no obligation to pay for costs of the Tenant Improvements or Change Orders in excess of Lessor's Contribution. For the purposes of this Lease, the costs incurred for the Tenant Improvements and Change Orders shall include, without limitation, the preparation of the Plans, hard construction costs, architectural and engineering fees, all governmental and other regulatory fees and costs associated with the Tenant Improvements and Change Orders, costs of utility connection and permitting. 4. SUBSTANTIAL COMPLETION. The Tenant Improvements shall be deemed ---------------------- to be "Substantially Completed", and "Substantial Completion" shall be deemed to occur when the Contractor certifies in writing to Lessor and Lessee that (a) Contractor has substantially performed all of the Tenant Improvement work required to be performed under this Plans, other than decoration and minor "punch list" items and adjustments which do not materially interfere with Lessee's access to or use of the Premises; and, if required, and (b) Contractor or Lessee has obtained a temporary certificate of occupancy or other required approval from the local governmental authority permitting occupancy of the Premises. The Contractor shall guaranty all work and Improvements for one (1) year from the earlier of Substantial Completion of the Tenant Improvements or the commencement of the warranty for those items covered by manufacturer's or vendor's warranties and, to the extent possible, shall assign all warranties to Lessee. 5. ARBITRATION. ----------- A. Dispute Resolution. If any dispute arises in connection with ------------------ this Tenant Improvement Agreement, such dispute shall be resolved in accordance with this Article. Such dispute shall be determined by a panel consisting of one representative of Lessor, one of Lessee's construction representatives (or another party designated by Lessee), and a third party with extensive development and construction experience in the construction of commercial office space in the San Diego County area selected in accordance with paragraph 5C of this Tenant Improvement Agreement ("Construction Panel"). B. Notice. All disputes to be determined in accordance with this ------ Section 5 shall be raised by notice to the other party, which notice shall state with particularity the nature of the dispute and the demand for relief, making specific reference by paragraph number and title to the provision of this Tenant Improvement Agreement alleged to give rise to the dispute. Such notice shall also refer to this Section 5. C. Selection of Third Party/Costs. Lessor and Lessee shall mutually ------------------------------ and promptly select a third party who meets the qualifications set forth in paragraph 5A of this Tenant Improvement Agreement. In the event a selection is not made within two (2) days after demand for resolution is made, the third party shall, upon the request of either party, be appointed by the then-president of the Association of General Contractors of San Diego County. All proceedings contemplated by this Section 5 shall take place at the locations for all job-site meetings, unless the Construction Panel mutually agrees to another location. The cost for the third party's services shall be paid by the non-prevailing party, unless the Construction Panel determines otherwise. D. Interpretation and Resolution. In determining any dispute, the ----------------------------- Construction Panel shall apply the pertinent provisions of this Tenant Improvement Agreement (and the Lease, if applicable) without departure therefrom in any respect. The Construction Panel shall not have the power to add to, modify or change any of the provisions of this Tenant Improvement Agreement, but this provision shall not prevent in any appropriate case the interpretation, construction and determination by the Construction Panel of the applicable provisions of this Tenant Improvement Agreement to the extent necessary in applying the same to the matters to be determined by the Construction Panel. E. Continued Performance. During any proceedings pursuant to this --------------------- Section 5, Lessor and Lessee shall, to the extent possible, continue to perform and discharge all of their respective obligations under this Tenant Improvement Agreement and the Lease. F. Binding Resolution. The Construction Panel shall meet within two ------------------ (2) days of the third party being selected as a member of the Construction Panel and the Construction Panel shall thereafter resolve the issue in dispute within two (2) business days, unless it is mutually agreed among the Construction Panel members that additional times is necessary to resolve the dispute, but in no event shall such additional time exceed five (5) business days. Lessor and Lessee agree that time and strict punctual performance are of the essence with respect to each provision of this Tenant Improvement Agreement and that any and all decisions of the Construction Panel as to the matter in dispute shall be binding upon both Lessor and Lessee. 6. MISCELLANEOUS. Terms used in this Exhibit B shall have the ------------- --------- meanings assigned to them in the Lease. The terms of this Exhibit B are subject --------- to the terms of the Lease. LANDLORD: TENANT: COMPS PLAZA ASSOCIATES, L.P. COMPS.COM, INC., A CALIFORNIA LIMITED PARTNERSHIP A DELAWARE CORPORATION By: Alden Properties, Inc. By: /s/ CHRIS McKELLAR By: /s/ KAREN GOODRUM ---------------------------------- --------------------------------- Name: Chris McKellar Name: Karen Goodrum -------------------------------- ------------------------------- Title: Vice President Title: Chief Financial Officer ------------------------------- ------------------------------ 2 EXHIBIT C --------- Rules and Regulations 1. Tenant must use window coverings approved by Landlord in all exterior or atrium window offices. No awning shall be permitted on any part of the Premises. Tenant shall not place anything against or near partitions, doors, or windows which may appear unsightly from outside the Premises. 2. The halls, passages, exits, entrances, elevators, and stairways are not for the use of the general public. Tenant shall not obstruct the hall, passages, exits, entrances, elevators or stairways. Landlord shall in all cases retain the right to control and prevent access thereto of all persons whose presence in the reasonable judgment of Landlord would be prejudicial to the safety, character, reputation, or interests of the Building and its tenants; provided that nothing contained herein shall be construed to prevent access to persons with whom any tenant normally deals in the ordinary course of its business, unless such persons are engaged in illegal activities. No tenant and no employee or invitee of any tenant shall go upon the roof of the Building or into mechanical, electrical, or phone rooms without Landlord's consent. All common areas and facilities forming a part of the Building shall be under the sole and absolute control of Landlord with exclusive right to regulate and control these areas. 3. Any directory of the Building will be provided, at Tenant's expense, exclusively for the display of the name and location of tenants only and Landlord reserves the right to limit the number of listings and exclude any other names therefrom. 4. All cleaning and janitorial services for the Building and the Premises shall be provided exclusively through Landlord, at Tenant's expense, and except with the written consent of Landlord, no person or persons other than those approved by Landlord may be employed by Tenant or permitted to enter the Building for the purpose of cleaning the same. Tenant shall not cause any unnecessary labor by carelessness or indifference to the orderliness and cleanliness of the Premises. Landlord shall not in any way be responsible to any Tenant for any loss of property on the Premises, however occurring, or for any damage to any Tenant's property by the janitor or any other employee or any other person. 5. 6. Any freight elevator shall be available for use by all tenants in the Building, subject to such reasonable scheduling as Landlord, in its sole discretion, shall deem appropriate. 7. Tenant shall not place a load upon any floor of the Premises which exceeds the load per square foot which such floor was designed to carry. Landlord shall have the right to prescribe the weight, size, and position of all equipment, materials, furniture, or other property brought into the Building. If heavy objects are deemed necessary by Tenant, and are pre-approved by Landlord, said objects shall stand on platforms to properly distribute the weight, the size and thickness of which shall be in Landlord's sole discretion. Any mechanical equipment or business machines which cause noise or vibration to be transmitted to the structure of the Building or other tenant's space and is objectionable to Landlord shall be placed on vibration eliminators or other devices sufficient to eliminate noise or vibration. Said eliminators shall be installed and maintained at Tenant's sole expense. The persons employed to move such equipment in or out of the Building must be reasonably acceptable to Landlord. Landlord will not be responsible for loss of, or damage to, any such equipment or other affected property or any damage done to the Building or other tenants by maintaining or moving such equipment or other property. Any such loss or damage shall be Tenant's responsibility and/or repaired at Tenant's sole expense. 8. Tenant shall not use or keep in the Premises any kerosene, gasoline, or flammable or combustible fluid or material. 9. Tenant shall not use, or permit to be used, in the Premises any foul or noxious gas or substance. 10. Tenant shall not permit or allow the premises to be occupied or used in a manner offensive or objectionable to Landlord or other occupants of the Building by reason of noise, odors, or vibrations. 11. Tenant shall not bring or keep in or about the Premises any birds or animals, except seeing-eye dogs when accompanied by their masters. 12. The building systems hours of operation shall be 7:00 a.m. to 6:00 p.m. Monday through Friday, excluding legal holidays. Tenant shall not use any method of heating or air conditioning other than that supplied or approved by Landlord. Tenant shall not waste electricity, water, or air conditioning and agrees to cooperate fully with Landlord to assure the most effective operation of the Building's heating and air conditioning and to comply with any governmental energy-saving rules, laws, or regulations for which Tenant has actual notice and shall refrain from attempting to adjust controls other than room thermostats installed for Tenant's use. Tenant shall keep corridor and/or exterior doors closed, and shall close window coverings at the end of each business day. 13. Landlord reserves the right to exclude from the Building between the hours of 6:00 p.m. and 7:00 a.m. the following day, or such other hours as may be established from time to time by Landlord, and on Sundays and legal holidays, any persons unless that person is known to the person or employee in charge of the Building and has a pass or is properly identified. Tenant shall be responsible for all persons for whom its requests passes and shall be liable to Landlord for all acts of such persons. Landlord shall not be liable for damage or for any error with regard to the admission to or exclusion from the Building of any person unless caused by the negligence or willful misconduct of Landlord or Landlord's agents. Landlord reserves the right to prevent access to the Building in case of invasion, mob, riot, public excitement, or other commotion by closing the doors or by other reasonably appropriate action. 14. Tenant shall close and lock the doors of its Premises and entirely shut off all water faucets or other water apparatus and, except with regard to Tenant's computers and other equipment which must be run on a twenty-four hour basis, all electricity, gas or air outlets before Tenant and its employees lease the Premises. Tenant shall be Initials: CM ---- KG ---- C-1 responsible for any damage or injuries sustained by other tenants or occupants of the Building or by Landlord resulting from noncompliance with this rule. 15. 16. The toilet rooms, toilet, urinals, wash bowls, and other apparatus shall not be used for any purpose other than that for which they were constructed and no foreign substance of any kind whatsoever shall be thrown therein. The expense of any breakage, stoppage, or damage resulting from the violation of this rule shall be borne by the tenant who, or whose employees or invitees, shall have caused it. 17. Tenant shall not sell, or permit the sale at retail, of newspapers, magazines, periodicals, theater tickets or any other goods or merchandise to the general public in or on the Premises. Tenant shall not make any suite-to-suite solicitation of business from other tenants in the Building. Tenant shall not use the Premises for any business or activity other than that specifically provided for in Tenant's Lease. 18. Tenant shall not mark, drive nails, screw, or drill into the partitions, woodwork, or plaster or in any way deface the Premises or any part thereof, except to install normal wall hangings. Landlord reserves the right to direct electricians as to where and how telephones and telegraph wires are to be introduced to the Premises. Tenant shall not cut or bore holes for wires. 19. 20. Canvassing, soliciting, or distribution of handbills or any other written material and peddling in the Building or on the Site are prohibited and each tenant shall cooperate to prevent same. 21. Landlord reserves the right to exclude or expel from the Building any person who, in Landlord's judgment, is intoxicated or under the influence of drugs or who is in violation of any of the Rules and Regulations of the Building. 22. Tenant shall store all its trash and garbage within its Premises or deposit in outside refuse containers intended for this purpose. Tenant shall not place in any trash box or receptacle any material which cannot be disposed of in the ordinary and customary manner of trash and garbage disposal. All garbage and refuse disposal shall be made in accordance with directions issued from time to time by Landlord. The outside areas immediately adjoining the Premises shall be kept clean and free of rubbish by Tenant to the satisfaction of Landlord, and Tenant shall not place or permit any obstruction or materials in such areas. 23. The Premises shall not be use for lodging nor shall the Premises be used for any illegal purpose. No cooking shall be done or permitted by any tenant on the Premises, except that use by Tenant of Underwriters' Laboratory-approved equipment for brewing coffee, tea, hot chocolate and similar beverages shall be permitted and the use of a microwave oven with all applicable federal, state, county, and city laws, codes, ordinances, rules and regulations. 24. Tenant shall not use in any space or in the public halls of the Building any mailcarts or hand trucks except those equipped with rubber tires and side guards or such other material handling equipment as Landlord may approve. Tenant shall not bring any vehicles of any kind into the Building. Carpet stains caused by hand trucks shall be cleaned at Tenant's expense. 25. Tenant shall comply with all safety, fire protection, and evacuation procedures and regulations established by Landlord or any governmental agency. 26. Tenant assumes any and all responsibility for protecting its Premises from theft, robbery, or pilferage unless caused by Landlord's negligence or willful misconduct. 27. Tenant shall address repair requests, concerns, etc., in writing to the office of the Building. Employees of Landlord shall not perform on behalf of Landlord or Tenant without express authority from Landlord. 28. Heat and air conditioning shall be furnished to the Premises by Landlord (as part of the Operating Expenses to be reimbursed by Tenant) during normal business hours of generally recognized business days, but not less than the hours of 7:00 a.m. to 6:00 p.m. Monday through Friday (excluding in any event Saturdays, Sundays and legal holidays). 29. Landlord may waive any one or more of these Rules and Regulations for the benefit of Tenant or any other tenant, but no such waiver by Landlord shall be construed as a waiver of such Rules and Regulations in favor of Tenant or any other tenant, nor prevent Landlord from thereafter enforcing any such Rules and Regulations against any or all of the tenants of the Building. Parking Rules and Regulations 1. Tenant and authorized users shall not park vehicles in any parking areas designated by Landlord as areas for parking by visitors to the Building. 2. 3. Tenant and authorized users shall not park any vehicle in the Building parking areas other than automobiles, motorcycles, motor driven or non-motor driven bicycles, or trucks. Landlord may, in its sole discretion, designate separate areas for bicycles and motorcycles. 4. Cars must be parked entirely within the painted stall lines. 5. All directional signs and arrows must be observed. Initials: CM ---- KG ---- C-2 6. The speed limit shall be 5 miles per hour. 7. Parking is prohibited: a. in areas not striped for parking; b. in aisles; c. where "No Parking" signs are posted; d. on ramps; e. in crosshatched areas; or f. in such other areas as may be designated by Landlord, its agent, lessee or licensee. 8. Parking stickers or any other device or form of identification that may be supplied by Landlord shall remain the property of Landlord. Such parking identification device must be displayed as requested and may not be mutilated in any manner. The serial number of the parking identification device may not be obliterated. Devices are not transferable, and any device in the possession of an unauthorized holder will be void. There will be a reasonable replacement charge to the Tenant or authorized user for any loss of any magnetic parking card or other parking identification device. 9. Parking managers or attendants, if any, are not authorized to make or allow any exception to these Parking Rules and Regulations. 10. Loss or theft of parking identification devices from automobiles must be reported to the garage manager and/or Landlord immediately. Any parking identification devices found on any unauthorized car will be confiscated. Lost or stolen devices previously reported and then found must be reported to the office of the garage and/or Landlord immediately. 11. Spaces are for the express purpose of one automobile per space. Washing, waxing, cleaning, or servicing of any vehicle by the Tenant, authorized user and/or its agents or representatives is prohibited. 12. The parking management, if any, and/or Landlord reserve the right to refuse the issuance of monthly stickers or other parking identification devices to any tenant, authorized user, or person and/or its agent or representative who willfully refuse to comply with the above Parking Rules and Regulations or any City, State, or Federal ordinance, law, or agreement. 13. Tenant, authorized users or its agents or representatives shall not load or unload in areas other than those designated by Landlord for such activities. 14. Tenant, authorized users or agents or representatives therefor and unauthorized users parked in prohibited areas, are subject to towing at tenant's or owner's expense. 15. These Rules and Regulations are in addition to the terms, covenants, agreements and conditions of any lease of premises in the Building. In the event these Rules and Regulations conflict with any provision of the Lease, the Lease shall govern. 16. 17. Tenant shall be responsible for the observance of all of the foregoing rules by Tenant's employees, agents, clients, customers, invitees, and guests. Initials: CM ---- KG ---- C-3 INSERTS TO COMPS PLAZA ASSOCIATES, L.P./COMPS.COM, INC. LEASE ------------------------------------------------------------- INSERT 4.2(B): - ------------- The amount of any charges for any services provided by affiliates, related or designated parties of Lessor, which are included in the Operating Expenses, shall be reasonable, customary and competitive with charges for similar services of independent contractors in the area where the Industrial Center is located. Notwithstanding the provisions of this Paragraph 4, the following shall not be included within Operating Expenses: (i) any depreciation on the Building or Industrial Center, (ii) costs incurred due to Lessor's violation of any terms or conditions of this Lease or any other lease relating to the Industrial Center, (iii) all principal interest, loan fees, and other financing costs related to any mortgage or deed of trust and all rental and other payable due under any ground or underlying lease of the Industrial Center, (iv) advertising, promotional, legal limit to leasing and marketing costs, space planning costs, Lessee allowances and concessions and other costs and expenses incurred in connection with any lease, sublease and/or assignment negotiations and transactions with present or prospective Lessees or other occupants of the Industrial Center (except as otherwise provided herein), (v) costs, including permit, license and inspection costs, incurred with respect to the installation of other Lessees or occupants in the Industrial Center, improvements made for the premises of other lessees or other occupants in the Industrial Center or incurred in renovating or otherwise improving, decorating, painting or redecorating vacant space for lessees or other occupants of the Industrial Center, (vi) any costs fines or penalties incurred due to violations by Lessor or other Tenants of the Industrial Center (other than Lessee) of any governmental rule or authority, this Lease or any other lease in the Industrial Center, or due to Lessor's gross negligence or willful misconduct, (vii) expenses incurred by Lessor in connection with services or other benefits which are exclusively provided to one or more Lessees of the Industrial Center, other than Lessee, without reimbursement, (viii) wages salaries, or other compensation paid to any executive employees of Lessor above the grade of project manager, (ix) Lessor's general corporate overhead and administrative expenses, (xii) reserves for any Expenses, (xiii) costs of correcting defects, including allowances for same, in the construction of the Building (including latent defects) or equipment used therein (or the replacement of defective equipment) and any associated Common Areas or other improvements, (xiv) costs directly resulting from the negligence or willful misconduct of Lessor, its employees, agents or contractors, (xv) all costs of initial construction and landscaping within the Industrial Center, (xvi) costs or fees related to the defense of Lessor's title to the Building and/or Industrial Center and (xvii) contributions to charitable or political organizations. Notwithstanding the specific itemization elsewhere in this Lease as to certain components of Operating Expenses, Lessor shall not be entitled to recover from all Lessees of the Industrial Center more than its actual costs and expenses of the Industrial Center. INSERT 4.2(D): - ------------- At any time within three (3) months of Lessee's receipt of any statement from Lessor relating to Operating Expenses, Lessor shall furnish Lessee following Lessee's written request therefor, invoices and other source documents relating to Operating Expenses. If it is determined from Initials: CM ---- KG ---- Lessee's audit of such Operating Expenses that Lessee was overcharged by more than three percent (3%), such overcharge shall entitle Lessee to credit against its next payment of Operating Expenses the amount of the overcharge and the costs associated with the audit (and, if such credit occurs following the expiration of the Term, Lessor shall promptly pay the amount of such credit to Lessee). If the audit determines that the Lessee was overcharged less than three percent (3%), such overcharge shall entitle Lessee to credit against its next payment(s) of Operating Expenses in the amount of the overcharge and Lessee shall pay for all costs associated with the audit. If the audit shall determine that Lessee was undercharged for the Operating Expenses, Lessee shall promptly pay the amount of such undercharge to Lessor and Lessee shall pay for all costs associated with the audit. Notwithstanding anything to the contrary herein, any Operating Expenses attributable to a period which falls only partially within the term of this Lease shall be prorated between Lessor and Lessee so that Lessee shall pay only that portion thereof which the part of such period within the Lease term bears to the entire period. INSERT 6.2(C): - ------------- Lessor shall indemnify, protect, defend and hold Lessee, its agents, employees and shareholders harmless from and against any and all damages, liabilities, judgments, costs, claims, liens, expenses, penalties, loss of permits and attorneys' and consultants' fees arising out of or involving any Hazardous Substance existing in, under or about the Premises prior to the Commencement Date of that certain Lease dated March 8, 1994 (as identified with more particularity in Paragraph 1 of Addendum #1) or brought onto the Premises by or for Lessor or by anyone under Lessor's control. No termination, cancellation or release agreement entered into by Lessor and Lessee shall release Lessor from its obligations under this Lease with respect to such Hazardous Substances, unless specifically so agreed by Lessor in writing at the time of such agreement. INSERT 6.3: - ---------- Notwithstanding the foregoing, Lessee's obligations under this Paragraph 6.3 shall not require Lessee to comply with Applicable Requirements with respect to any Hazardous Substances or environmental conditions on, in, under or about the Premises, including soil and groundwater conditions, which existed prior to the Commencement Date of that certain Lease dated March 8, 1994 (as identified with more particularity in Paragraph 1 of Addendum #1) or which were caused by Lessor or any other lessee of the Industrial Center or their respective agents, employees or contractors. INSERT 7.2: - ---------- If Lessor fails to perform any of its repair and maintenance obligations under this Paragraph 7.2 or otherwise as required in this Lease, and such failure materially affects Lessee's ability to use and occupy the Premises for the purposes permitted herein, Lessee shall have the right, but not the obligation, to perform such repairs and/or maintenance if such failure continues for more than fifteen (15) days after written notice from Lessee; provided, however, that if the nature of the repairs and/or maintenance to be completed by Lessor is such that more than fifteen (15) days are required to complete such repairs and/or maintenance, Lessor shall have such additional time Initials: CM ---- KG ---- 2 as is reasonably necessary to complete such repairs and/or maintenance so long as Lessor takes appropriate action to commence such repairs and/or maintenance within such fifteen (15) day period and thereafter diligently pursues such repairs and/or maintenance to completion. In such event, Lessor shall reimburse Lessee for the reasonable costs incurred by Lessee to complete such repairs and/or maintenance within thirty (30) days after receipt of Lessee's written demand therefore, together with copies of the paid invoices evidencing the costs incurred by Lessee. Any repairs and/or maintenance permitted herein shall be performed in a good workmanlike manner by licensed contractors. If Lessor objects to the repairs and/or maintenance performed or the expenses incurred by Lessee in performing such work, Lessor shall deliver a written notice of Lessor's objection to Lessee within thirty (30) days after Lessor's receipt of Lessee's invoice evidencing the expenses incurred by Lessee. Lessor's notice shall set forth in reasonable detail Lessor's reasons for its claim that such repairs and/or maintenance were not required or were not Lessor's obligation in the terms of this lease and/or the reasons for Lessor's dispute of the expenses incurred by Lessee in performing such work. INSERT 7.4(C): - ------------- Any Trade Fixtures and Equipment purchased by Lessee and installed in the Premises, which Lessee intends to remove from the Premises upon the expiration or earlier termination of this Lease, shall be separately identified on a list ("Equipment List") to be compiled by Lessee for approval of Lessor, which approval shall not be unreasonably withheld. The Lease shall be amended to incorporate the Equipment List upon its completion. The Trade Fixtures and Equipment on the Equipment List shall be and remain the sole property of Lessee. Said Fixtures and Equipment may be removed form the Premises by Lessee at any time during the term of this Lease. INSERT 10.2: - ----------- Notwithstanding the foregoing provisions of this Paragraph 10.2 to the contrary, "real property taxes" shall not include (a) Lessor's federal or state income, franchise, inheritance or estate taxes or (b) any taxes on Lessor's personal property not located in or on the Industrial Center or (c) any taxes on the personal property of other tenants in the Building. In the case of any assessment which may be evidenced by improvement or other bonds or which may be paid in annual or other periodic installments, Lessor shall elect to cause such assessment to be paid in installments over the maximum period permitted by law. INSERT 12.1(B): - -------------- (b) Any provision in this Lease to the contrary notwithstanding, Lessor's consent shall not be required for an assignment or subletting to: (i) any entity who controls, is controlled by or is under common control with Lessee, (ii) any successor corporation resulting from a merger, acquisition, consolidation or reorganization or (iii) to any person or legal entity having a consolidated net worth of at least $5 million which acquires all the assets of Lessee as a going concern of the business being conducted on the Premises (each of the foregoing is hereinafter referred to as a "PERMITTED TRANSFEREE"), provided that before such assignment shall be Initials: CM ---- KG ---- 3 effective (i) said Permitted Transferee shall assume, in full, the obligations of Lessee under this Lease, (ii) Lessor shall be given written notice of such assignment and assumption and (iii) the use of -the Premises by the Permitted Transferee shall be for the Permitted Use only. For purposes of this paragraph, the term "control" means possession, directly or indirectly, of the power to direct or cause the direction of the management, affairs and policies of anyone, whether through the ownership of voting securities, by contract or otherwise. For purposes of this Lease, the sale or transfer of Lessee's capital stock, including without limitation a private or public offering or a transfer in connection with a merger, consolidation or reorganization of Lessee, shall not be deemed an assignment, subletting or other transfer or encumbrance of the Lease or the Premises. An assignment or subletting to a Permitted Transferee shall not release the assigning Lessee from any of its duties and obligations hereunder. INSERT 12.3(F): - -------------- (f) The parties agree that fifty percent (50%) of any amounts paid by an assignee or subtenant in excess of (i) the Basic Rent payable by Lessee hereunder or, in the case of a sublease of a portion of the Premises, in excess of the Basic Rent reasonably allocated to such portion plus (ii) Lessee's out- of-pocket costs for such assignment or subletting including, without limitation, broker's commissions, attorney's fees, tenant improvements and any payment under Paragraph 12.2(e), shall be the property of Lessor and such amounts shall, at Lessee's option, be payable by Lessee or directly to Lessor by the assignee or subtenant. At Lessor's request, a written agreement shall be entered into by and between Lessor, Lessee and the proposed assignee or subtenant in a form reasonably acceptable to each confirming the requirements of this subparagraph. INSERT 17: - --------- Notwithstanding the foregoing, a Lessor whose interest in this Lease or the Premises is foreclosed by a foreclosure or execution sale shall not be relieved of liability unless the party who acquires the Lessor's interest agrees to recognize Lessee's interest and rights in and under this Lease and not to disturb Lessee's possession hereunder so long as Lessee is not in default beyond any applicable cure period hereunder. Initials: CM ---- KG ---- 4 ADDENDUM #1 COMPS PLAZA ASSOCIATES, L.P./COMPS.COM, INC. LEASE DATED JANUARY 31, 1999 1. CANCELLATION OF PRIOR LEASE That certain Lease dated March 8, 1994 by and between COMPS Plaza Associates, L.P., (successor in interest to Plaza Associates, a joint venture partnership), as Landlord and Business Real Estate Information Corp., a California corporation, as Tenant, as amended by Amendment #One dated May 5, 1994; Amendment of Lease dated September 15, 1994; Third Amendment to Lease dated January 3, 1997; Fourth Amendment to Lease dated October 22, 1997; Fifth Amendment to Lease dated July 29, 1998; Sixth Amendment to Lease dated September 1, 1998 and Seventh Amendment to Lease dated October 5, 1998 shall be canceled upon the Commencement Date of this Agreement ( March 1, 1999) and neither Tenant nor Landlord shall have any obligations under the prior lease beyond its cancellation date. 2. PREMISES The Premises consist of approximately 33,217 rentable square feet as specified below and shown on the attached Exhibit "A". SUITE RENTABLE SQUARE FEET ----- -------------------- 100 8,813 101 2,747 111 1,383 116 1,518 120 1,279 200 6,432 212 2,387 222 2,105 225 3,510 235 905 236 2,138 3. EXPANSION SPACE Lessee shall take possession of each suite specified below immediately upon the vacating of each individual suite by its respective current tenant. The Base Rent for each said expansion suite, which Lessee will be obligated to pay starting on the date Lessee takes possession of each expansion suite, shall be calculated by using the per square foot rental rate which is in effect at the time Lessee takes possession of each expansion suite. The Base Rent for the expansion suites shall be adjusted in accordance with Paragraph 4 of this Addendum. Lessee shall be entitled to the tenant improvement allowance set forth in this Paragraph 6 of this Addendum with respect to each expansion suite. RENTABLE CURRENT TENANT SUITE SQUARE FEET LEASE EXPIRATION ------ ----------- ---------------- 115 2,042 Month to Month (14 day notice) 122 2,105 Month to Month (60 day notice) 214 852 5/31/99 216 769 5/31/99 218 871 3/31/99 220 1,159 3/31/99 Initials: CM ---- KG ---- 23 4. BASE RENT ADJUSTMENT The monthly Base Rent shall be adjusted upward by three and one half percent (3 1/2%) on each anniversary of the Commencement Date during the five (5) years of the Original Term. Upon the Substantial Completion ( as defined in attached Exhibit "B", Tenant Improvement Agreement) of Tenant Improvements in Suite 236, the then current monthly Base Rent shall be increased $622.00 per month. Upon the Commencement Date of each extension of the Term, monthly Base Rent shall be adjusted to reflect the fair market rental value of such space as determined according to Paragraph 5 below. Annual adjustments will thereafter continue at three and one half percent (3 1/2%). 5. DETERMINATION OF FAIR MARKET VALUE The fair market rental value of the Premises for purposes of the adjustment set forth above shall be determined in accordance with the following procedure: No later than sixty (60) days prior to the Adjustment Date, Lessor and Lessee will attempt to agree on a fair market rental for the Premises. If Lessor and Lessee fail to agree on the fair market rental value of the Premises by thirty (30) days before the Adjustment Date, Lessor and Lessee shall each select, within ten (10) days after such failure, an appraiser who is a member of a nationally recognized society of appraisers (MAI) to render an opinion on the fair market rental value of the Premises and each party shall notify the other, in writing, of the name and qualifications of the appraiser selected. If either party fails to designate an appraiser within the time required, the determination of the fair market rental value made by the appraiser selected in a timely manner shall be conclusively the fair market rental value for the Premises and the rental for the period in question, subject to the ten percent (10%) adjustment limitation set forth above. The appraisers selected by the parties shall submit their opinions of the fair market rental value of the Premises to both parties, in writing, within fifteen (15) days after their selection. If the difference between the opinions of the two (2) appraisers is ten percent (10%), the two appraisers shall, within ten (10) days after the date that the later opinion of value is rendered to the parties, designate a third similarly qualified appraiser. The sole responsibility of the third appraiser shall be to determine which of the opinions presented by the first two appraisers is most accurate. The third appraiser shall have no right to propose a middle ground or any modification of either of the opinions of the first two appraisers. The third appraiser's choice shall be submitted to the parties within ten (10) days after his or her designation. Such determination shall bind both the parties and shall establish the fair market rental value of the Premises. Each party shall pay the fees and expenses of the appraisers selected by it, and they shall pay equal shares of the fees and expenses of the third appraiser. If the rent for a particular period has not yet been established as herein above provided at the commencement date of that period, Lessee shall continue to pay the rent paid during the year immediately preceding the period until the rent for the period in question has been established. Lessee shall (i) pay any additional amount of Rent that may be due within fifteen (15) days after the Rent for the period in question has been determined or (ii) receive a credit for any over-payment to its next Rent payment. "Fair market rental value" for the purpose of this Agreement shall mean the then prevailing rent for properties (a.) in the general geographic vicinity as; (b.) comparable in size and use to; (c.) improved to similar standards as; and (d.) leased similarly to the Premises. Initials: CM ---- KG ---- 24 6. TENANT IMPROVEMENTS At the inception of this Lease, Lessor shall at its sole cost and expense paint and clean the carpet in the Premises where needed as reasonably agreed by Lessee and Lessor. Lessor shall grant Lessee an allowance of $2.00 per rentable square foot for tenant improvements made to previously improved expansion space and $22.00 per rentable square foot for tenant improvements made to Suite 236 (which has not previously been improved) as it is expended by Lessee. The allowance may not be accumulated to be spent disproportionately amongst the suites. All tenant improvements shall be made pursuant to the terms of the Tenant Improvement Agreement attached hereto as Exhibit "B" (the "T.I. Agreement"); provided, however, that the parties may amend such T.I. Agreement to the extent the anticipated improvements are to be made to space currently occupied by Lessee. Lessor and Lessee agree to work together in good faith to ensure that any tenant improvements to be made by Lessor do not unreasonably disturb Lessee's business operations in the premises or access thereto. 7. RIGHT OF FIRST REFUSAL Provided Lessee is not in default under all or any of the terms and conditions of the Lease beyond any applicable cure period, Lessor agrees that it will not enter into a new lease for any space in the building not occupied by Lessee without first notifying Lessee in writing. If Lessee, within ten (10) business days after receipt of Lessor's written notice, indicates and delivers in writing to Lessor its agreement to lease such space, said space shall be leased to Lessee for the same rate as that then payable by Lessee per square foot in accordance with the Base Rent schedule of this Lease. 8. OPERATING EXPENSES Notwithstanding anything to contrary in this Lease Operating Expenses for the 1999 calendar year will be billed at $.365 per rentable square foot per month (based on 1998 actual Operating Expenses) and shall be due and payable on the first day of each month commencing upon the Commencement Date of the Lease. Operating Expenses will be increased no more than three and one half percent (31/2 %) per year on a cumulative basis effective February 1 of each year of the Term and any extension(s) thereof. Lessee's Share of electricity for all suites within the Building is 70.6% (Suite 228 is separately metered and the current tenant pays SDG&E directly for its suite electrical usage), Lessee's Share for all other Operating Expenses is 63.4%. Lessee's Share will ultimately be adjusted to 87.2% for suite electricity and 78.2% for all other Operating Expenses when Lessee has taken possession of all expansion space specified in Paragraph 3 of this Addendum. 9. RELOCATION OF TENANT IN SUITE 228 Lessor acknowledges that Lessee desires to occupy Suite 228 which is currently occupied by Nowak-Meulmester. Lessor agrees to cooperate with Lessee to relocate or buy Nowak-Meulmester out of its remaining lease term and will diligently negotiate with Nowak-Meulmester in an effort to have them vacate their premises so that Lessee may occupy Suite 228. Lessee shall cooperate with Lessor in connection with such negotiations, participating in them where reasonably necessary. Lessor's contribution toward actual costs of such relocation or buy out shall not exceed $34,000.00. Initials: CM ---- KG ---- 25 10. AFTER HOURS AIR CONDITIONING/HEATING/VENTILATION Lessor shall furnish to the Premises ( as part of the Operating Expenses to be reimbursed by Lessee to Lessor) heating, ventilation and air conditioning ("HVAC") during normal business hours which shall mean between the hours of 7:00 a.m. to 6:00 p.m., Monday through Friday, excluding Federal holidays. Should Lessee request HVAC services outside normal business hours, Lessor shall use reasonable efforts to provide such services and Lessee shall pay, as additional rent, $15.00 per hour for each hour of service requested. 11. PARKING Lessee shall be entitled to the use, on a nonexclusive and unreserved basis, of one hundred twelve (112) parking spaces in the Building parking lot. In addition, one space shall be designated for Lessee's "Employee of the Month" in a location to be determined by Lessor in its sole discretion. Lessee shall pay all costs incurred with respect to any sign or pavement stenciling to identify the "Employee of the Month" parking space. 12. OPTION TO EXTEND Lessee may extend the Term of the Lease for five (5) terms of two (2) years each. The Term shall automatically extend for two (2) years upon the expiration of the preceding Term unless Lessee provides to Lessor a six (6) month prior written notice that states that Lessee will not extend the Term. Provided, however, if Lessee is in default beyond any applicable cure period on the date the extended term is to commence, at Lessor's option, the Lease shall expire at the end of the then current Term. The options granted to Lessee in the Lease are personal to Lessee and may not be exercised or be assigned, voluntarily or involuntarily, by or to any person or entity other than Lessee or Permitted Transferee. Lessee's Base Rent during said extended Terms shall be the then "market rent" for the Premises as determined pursuant to Paragraph 5 of this Addendum. Lessor and Lessee shall promptly execute an addendum to the Lease memorializing the extension of the Terms and the Base Rent. Lessee's occupancy during such extended Term shall be governed by all of the other terms, conditions, covenants and provisions of the Lease, and all references to the Term shall mean the Term as extended. LESSOR: LESSEE: COMPS Plaza Associates, L.P. COMPS.COM, Inc., By: Alden Properties, Inc., a Delaware corporation a California corporation Signature: /s/ CHRISTOPHER S. McKELLAR Signature /s/ KAREN GOODRUM ---------------------------- ----------------------- Christopher S. McKellar Karen Goodrum Vice President Chief Financial Officer Date: 1/31/99 Date: 1/31/99 -------------------------------- --------------------------- 26 EX-10.15 20 FORM OF EMPLOYMENT & INCENTIVE COMPENSATION AGMT EXHIBIT 10.15 FORM OF EMPLOYMENT AND INCENTIVE COMPENSATION AGREEMENT This EMPLOYMENT AND INCENTIVE COMPENSATION AGREEMENT ("Agreement") is made effective as of this _____ day of ________ 1994 (the "Effective Date"), between COMPS, InfoSystems, Inc., a Delaware corporation, hereinafter referred to as "COMPS," and _________________, hereinafter referred to as "Employee." IN CONSIDERATION of the promises and of the mutual covenants contained herein, and for other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows: 1. Employment. COMPS hereby affirms its employment of Employee, and ---------- Employee hereby affirms such employment, upon the terms and conditions set forth herein. 2. Duties. Employee is engaged in the position of ------ _________________________________ of COMPS. Employee shall faithfully and diligently perform the duties customarily performed by persons in the position for which Employee is engaged, together with such other duties as ________ and/or the Board of Directors of COMPS shall designate from time to time. Specifically, but not by way of limitation, Employee shall perform those duties set forth on Exhibit A, attached hereto and incorporated herein by reference. As part of Employee's duties, Employee acknowledges and understands that: (a) Employee will devote utmost knowledge and best skill to the performance of his/her duties; (b) Employee shall devote his/her full business time to the rendition of such services, subject to absences for customary vacations and for temporary illness; and (c) Employee will not engage in any other gainful occupation which requires his/her personal attention without prior consent of _______, with the exception that Employee may personally trade in stock, bonds, securities, commodities or real estate investments for his/her own benefit. Employee agrees to submit to periodic physical examinations for any valid COMPS purpose as determined in the sole discretion of the Board of Directors of COMPS. 3. Compensation. ------------ 3.1 Base Salary. As compensation for the proper and satisfactory ----------- performance of all duties to be performed by employee hereunder, COMPS shall pay to Employee a salary of ____________ per month, for each whole month during the employment term (as defined in Section 4 below) of this Agreement, payable in arrears in equal, semi- monthly installments ("Base Salary"). The Base Salary may be increased or decreased from time to time, at the sole discretion of COMPS. In the event of such increase, COMPS shall notify Employee of the amount by a letter to Employee signed by the Chief Executive Officer of COMPS. Any increase in the Base Salary shall be effective for the remainder of the Term of this Agreement. 3.2 Customary Fringe Benefits. Employee shall be entitled to such ------------------------- fringe benefits as COMPS customarily makes available to executive employees of COMPS ("Fringe Benefits"). Such Fringe Benefits may include vacation leave, sick leave, and health insurance coverage. COMPS reserves the right to change the Fringe Benefits on a prospective basis, at any time, effective upon delivery of written notice to Employee, and in all events the Fringe Benefits shall terminate upon termination of employment. 3.3 Incentive Compensation and Stock Option Plan. Employee shall -------------------------------------------- receive such rights to which Employee may become entitled under the terms of the COMPS Stock Option Plan. Employee shall also receive the Incentive Compensation outlined in Section 7 hereof. 3.4 Withholding. All payments of compensation under this Agreement, ----------- in whatever form, are subject to any required deductions for state and federal withholding tax, Social Security and all other employee taxes and payroll deductions ("Base Salary"). 4. Term. The employment term pursuant to this Agreement shall commence on ---- the Effective Date set forth above, and shall remain in effect until __________________ (the "Expiration Date"), unless Employee's employment is terminated sooner in accordance with the provisions of Section 5 below. If the Agreement is not terminated pursuant to Section 5, the Agreement shall continue from year to year after ________________, unless either party to the Agreement shall give written notice to the other of a desire to change, amend, modify or terminate the Agreement, at least 30 days prior to ______________ or each succeeding ____________. 2 5. Termination. This Agreement and the employment of Employee shall ----------- terminate prior to its expiration date under the following conditions: 5.1 Death. The death of Employee; ----- 5.2 Disability. The permanent disability of Employee (permanent ---------- disability shall exist when Employee suffers from a condition of mind or body that indefinitely prevents Employee from satisfactory further performance of his/her duties, even with reasonable accommodation); 5.3 Termination for Good Cause. Upon receipt by Employee of written -------------------------- notice from Employer that Employee's employment is being terminated for "good cause." The Employer has "good cause" to terminate Employee's employment if Employee engages in the following: 5.3.1 Any wilful misappropriation, destruction, or damage to property or funds belonging to COMPS, or its employees, clients or visitors. 5.3.2 Sexual, verbal, or physical harassment or discrimination towards any employee, client, or visitor of COMPS. 5.3.3 Internal or external dishonesty, or any other act of deceit, in connection with COMPS' business. 5.3.4 Consuming or being under the influence of alcohol or illegal drugs while at work. 5.3.5 Commission of a felony which results in conviction. 5.3.6 Breach of the provisions of Sections 9, 10 or 11 hereof. 5.3.7 Competition with COMPS (as defined in Section 12) by Employee. 5.3.8 Employee fails or refuses to faithfully and diligently perform any of his/her customary or assigned duties which failure or refusal is not cured within 30 days after written notice thereof is given to Employee. 3 5.3.9 Employee fails or refuses to comply with the policies, standards and regulations of the Employer which from time to time may be established, which failure or refusal is not cured within 15 days after written notice thereof is given to Employee. 5.4 Termination at Will. Although COMPS and Employee anticipate an ------------------- employment relationship through the end of the effective date, COMPS may terminate the employment of Employee at any time, with or without cause, upon written notice delivered to Employee that Employee's employment is being terminated for "other than good cause." 5.5 Employee Resignation. Employee may resign at any time during the -------------------- term of this Agreement by providing 60 days' advance notice of that resignation. Employee will continue to receive his/her Base Salary through that notice period. 6. Compensation Upon Termination. ----------------------------- 6.1 Payment of Compensation Upon Termination for Cause. In the event -------------------------------------------------- Employee is terminated for good cause, as set forth in Section 5.3, he/she shall receive notice of termination that day and shall be entitled only to the compensation set forth as Base Salary herein, prorated through the date of said notice. When Employee is terminated for good cause as defined in Section 5.3, Employee is entitled to no other severance compensation arising out of this Agreement and out of his/her employment relationship with COMPS, and Employee shall permanently and absolutely forfeit all rights to all other benefits otherwise accruing by reason of Employee's employment by COMPS. Without limiting the generality of the foregoing, Employee shall, upon termination for good cause, permanently and absolutely forfeit all rights to incentive compensation, as described in Section 7 hereof, and all rights under the Stock Option Plans, as set forth in Exhibit B. 6.2 Payment of Compensation Upon Termination Other Than for Good Cause. ------------------------------------------------------------------ In the event Employee's employment is terminated for other than good cause, Employee shall receive Base Salary continuation in an amount described below, and certain partial incentive bonus, but, only if Employee executes a general release of claims in a form satisfactory to COMPS, releasing any and all claims Employee has against COMPS arising out of his/her 4 employment or the termination of said employment. Employee is not entitled to any Base Salary continuation pursuant to this Section unless he/she signs the general release described above. The Base Salary continuation described in this Section amounts to four months' Base Salary continuation if Employee's employment terminates other than for good cause prior to November 1, 1995, five months' Base Salary continuation if Employee's employment is terminated other than for good cause between November 1, 1995 and October 31, 1996, and six months' Base Salary continuation if Employee's employment terminates other than for good cause after October 31, 1996. The maximum Base Salary continuation Employee may receive under this Section is six months' salary. Employee shall also be entitled to the partial Incentive Bonus under Section 7.3 (treating, for purposes of Section 7.3, Employee as "actively employed" for the Base Salary continuation period). Employee is entitled to no other Base Salary continuation when his/her employment is terminated for other than good cause, pursuant to Section 5.4. 7. Incentive Compensation. In addition to the Base Salary, within thirty (30) ---------------------- days after issuance of quarterly accrual basis financial statements, COMPS shall pay to Employee an incentive bonus (the "Incentive Bonus") for each fiscal quarter the last day of which falls within the employment term pursuant to this Agreement. Notwithstanding anything herein to the contrary, however, such Incentive Bonus shall only be paid when COMPS' cash flow permits such payment. The Incentive Bonus shall be computed in accordance with any bonus plan established by the Compensation Committee for each quarter. The Compensation Committee may modify or terminate any Incentive Bonus Program in which Employee is a participant at any time upon written notice to Employee. 7.1 Termination. Employee shall not be entitled to any Incentive Bonus if ----------- Employee's active employment is for less than the full fiscal quarter in question, and Employee shall receive no Incentive Bonus for any partial fiscal quarter of employment unless Employee's employment hereunder is terminated by reason of Employee's death or disability, or pursuant to Section 5.4. In any such instance, COMPS shall pay Employee or Employee's estate an Incentive Bonus for the portion of the fiscal quarter during which Employee was actively employed by COMPS. Employee's partial Incentive Bonus shall be determined by multiplying the Incentive Bonus which would have been paid 5 to Employee pursuant to this Section 5 if Employee had remained employed by COMPS at the end of the fiscal quarter by a fraction, the numerator of which is the number of complete months of the fiscal year during which Employee was actively employed by COMPS and the denominator of which is twelve (12). 8. Arbitration/Sole Remedy for Breach of Agreement. Except as provided in ----------------------------------------------- Section 9, in the event of any dispute between Employer and Employee concerning any aspect of the employment relationship, including any disputes upon termination, all such disputes shall be resolved by binding arbitration before a single neutral arbitrator. The arbitrator shall be selected from the American Arbitration Association through its procedures. All rules governing the arbitration shall be the rules as set forth by the American Arbitration Association. The arbitrator is bound to rule only on whether or not there has been a violation of the terms of this Agreement and to render an award, if any, that is consistent with the terms of this Agreement. Neither party to this Agreement is entitled to any legal recourse or rights or remedies other than those provided within this Agreement. The Employee's sole remedies for claims arising out of his employment, with the exception of Workers' Compensation remedies, are those set forth in this Agreement. In the event of a termination of employment, the arbitrator is limited to a determination of whether or not the discharge was for good cause or for other than good cause. If an arbitration is brought for something other than a termination of employment, the arbitrator is limited to award contract damages. The arbitrator may apportion the costs of the arbitration, including arbitrator's fees, among the parties, but shall have no power to award attorneys' fees. Each party shall be responsible for its own attorneys' fees. 9. Trade Secrets. Employee agrees that he/she has also signed and will abide ------------- by the terms of COMPS' Employee Agreement Concerning Confidentiality, Trade Secrets, Outside Employment and Solicitation of BREIC Employees as a condition of Employee's employment. 10. No Adverse Use. Employee will not at any time use COMPS' Trade Secrets or -------------- Inventions in any manner which may directly or indirectly have an adverse effect upon COMPS' business, nor will Employee perform any acts which would tend to reduce COMPS' proprietary value in Trade Secrets or Inventions. 11. Return of Materials at Termination. In the event of any termination of ---------------------------------- Employee's employment or upon the request of 6 COMPS at any time, Employee or Employee's representative will promptly deliver to COMPS all materials, property, documents, data, and other information belonging to COMPS or pertaining to Trade Secrets or Inventions. Employee shall not take any materials, property, documents or other information, or any reproduction or excerpt thereof, belonging to COMPS or containing or pertaining to any Trade Secrets or Inventions. 12. Covenant Not to Compete. Employee agrees that, during Employee's ----------------------- employment, and during any period prior to which payments to Employee under Sections 5 and 6 and Exhibit B are completed, Employee will not directly or indirectly compete with COMPS in any way, or prepare to compete or assist any other person or entity to compete with COMPS in any way, and that Employee will not act as an officer, director, employee, consultant, more than three percent (3%) shareholder, significant lender, or agent of any other entity which is engaged in any business in California, Arizona or Nevada of the same nature as, or in competition with, the business in which COMPS is now engaged or in which COMPS becomes engaged during the term of Employee's employment. 13. General Provisions. ------------------ 13.1 Payments. All payments due pursuant to the terms of this Agreement -------- shall be delivered in person, or by first class mail, postage prepaid to the last known address of the other party. Payments may be in lawful money of the United States, or may be made by check, draft or warrant of the paying entity. 13.2 Notices. Any notices to be given hereunder by either party to the ------- other may be effected by either personal delivery in writing, or by mail, registered or certified, postage prepaid with a return receipt requested. Mailed notices shall be addressed to the other party to the address appearing beneath the party's signature on this Agreement, but each party may change its address by written notice in accordance with this paragraph. Notices delivered personally shall be deemed communicated as of the date of delivery. 13.3 Complete Agreement. Employee acknowledges receipt of this ------------------ Agreement and agrees that this Agreement and COMPS' Employee Agreement Concerning Confidentiality, Trade Secrets, Outside Employment and Solicitation of BREIC Employees represent the entire Agreement with Employer concerning the subject matter hereof. These Agreements 7 supersede any and all other Agreements, either oral or in writing, between the parties hereto with respect to the matters discussed herein of Employee and contain all of the covenants and agreements between the parties with respect to the terms and conditions of Employee's employment. Employee hereby waives any rights previously award to Employee under any previous employment agreements, if any, including, without limitation, any rights under any: a) Phantom Stock Option Award Program; b) Incentive Compensation/Target Bonus Program; and/or c) Stock Option Plan. Each party to these Agreements acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party or anyone acting on behalf of any party which are not embodied herein. 13.4 Severability. If any provision of this Agreement is held by a ------------ court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way. 13.5 Other Benefits. Any amounts payable under this Agreement, other -------------- than Base Salary, shall not be deemed salary or other compensation for the purpose of computing benefits under any pension plan or other arrangement of COMPS for the benefit of its employees. 13.6 No Waiver. Either party's failure to enforce any provision of this --------- Agreement shall not in any way be construed as a waiver of any such provision, or prevent that party from thereafter enforcing each and every other provision of this Agreement. 13.7 Successors and Assigns. The rights and obligations of COMPS under ---------------------- this agreement shall enure to the benefit of and shall be binding upon the successors and assigns of COMPS. Employee shall not be entitled to assign any of his/her rights or obligations under this agreement. 13.8 Applicable Law. This agreement shall be interpreted, construed, -------------- governed and enforced in accordance with the laws of the State of California. 13.9 Amendments. No amendment or modification of the terms or ---------- conditions of this agreement shall be valid unless in writing and signed by the parties thereto. 8 IN WITNESS THEREOF, the parties hereto execute this Agreement, effective as of the date first above written. EMPLOYEE: COMPS InfoSystems, Inc., a California corporation ____________________________ By:___________________________ Print Name and Address Its:__________________________ ____________________________ ____________________________ 9 EX-10.16 21 EXECUTIVE EMPLOYMENT AGMNT DATED 10/14/94 Exhibit 10.16 EXECUTIVE EMPLOYMENT AGREEMENT This EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is made effective as of this 14th day of October, 1994 (the "Effective Date"), between COMPS, InfoSystems, Inc., a Delaware corporation, hereinafter referred to as "COMPS," and Chris Crane, hereinafter referred to as "Employee." IN CONSIDERATION of the promises and of the mutual covenants contained herein, and for other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows: 1. Employment. COMPS hereby affirms its employment of Employee, and ---------- Employee hereby affirms such employment, upon the terms and conditions set forth herein. 2. Duties. Employee is engaged in the position of President and Chief ------ Executive Officer of COMPS. Employee shall faithfully and diligently perform the duties customarily performed by persons in the position for which Employee is engaged, together with such other duties the Board of Directors of COMPS shall designate from time to time. As part of Employee's duties, Employee acknowledges and understands that: (a) Employee will devote utmost knowledge and best skill to the performance of his duties; (b) Employee shall devote his full business time to the rendition of such services, subject to absences for customary vacations and for temporary illness; and (c) Employee will not engage in any other gainful occupation which requires his personal attention without prior consent of the Board of Directors with the exceptions that Employee may personally trade in stocks, bonds, securities, commodities or real estate investments for his own benefit, Employee may continue in his capacity as President of the corporate general partnership that owns the building that COMPS leases, and Employee may continue in his capacity as a Director on the Board of Directors for Beeba's Creations, Inc. Employee agrees to submit to periodic physical examinations for any valid COMPS purpose as determined in the sole discretion of the Board of Directors of COMPS. 3. Compensation. ------------ 3.1 Base Salary. As compensation for the proper and satisfactory ----------- performance of all duties to be performed by employee hereunder, COMPS shall pay to Employee a salary of $12,500.00 per month, for each whole month during the employment term (as defined in Section 4 below) of this Agreement, payable in arrears in equal, semi-monthly installments ("Base Salary"). The compensation Committee of the Board of Directors will review Employee's Base Salary each year to determine if a change in Employee's Base Salary will occur. 3.2 Bonus. Before the commencement of each fiscal year, the Board of ----- Directors and Employee shall agree upon objectives for Employee to meet that year. Those objectives are for the purpose of determining bonus compensation to Employee. The mutually agreed to objectives, if met, will result in a target bonus to Employee of $50,000.00 for fiscal year 1995. The Compensation Committee of the Board of Directors will review Employee's Bonus each year to determine if a change in Employee's Bonus will occur. CAC 3.3 Customary Fringe Benefits. Employee shall be entitled to such ------------------------- fringe benefits as COMPS customarily makes available to executive employees of COMPS ("Fringe Benefits"). Such Fringe Benefits may include vacation leave, sick leave, and health insurance coverage. COMPS reserves the right to change the Fringe Benefits on a prospective basis, at any time, effective upon delivery of written notice to Employee, and in all events the Fringe Benefits shall terminate upon termination of employment. 4. Term. The employment term pursuant to this Agreement shall commence on ---- the Effective Date set forth above, and shall remain in effect until October 15, 1997 (the "Expiration Date") , unless Employee's employment is terminated sooner in accordance with the provisions of Section 5 below. If the Agreement is not terminated pursuant to Section 5, the Agreement shall continue from year to year after October 15, 1997, unless either party to the Agreement shall give written notice to the other of a desire to change, amend, modify or terminate the Agreement, at least 30 days prior to October 15, 1997, or each succeeding October 15. 5. Termination. This Agreement and the employment of Employee shall ----------- terminate prior to its expiration date under the following conditions: 5.1 Death. The death of Employee. ----- 5.2 Disability. The permanent disability of Employee (permanent ---------- disability shall exist when Employee suffers from a condition of mind or body that indefinitely prevents Employee from satisfactory further performance of his duties, even with reasonable accommodation, for a cumulative period of 120 business days in any consecutive twelve month period following the commence of employment. 5.3 Termination for Good Cause. Upon receipt by Employee of written -------------------------- notice from Employer that Employee's employment is being terminated for "good cause." The Employer has "good cause" to terminate Employee's employment if Employee engages in the following: 5.3.1 Any willful misappropriation of property or funds belonging to COMPS, or its employees, clients, or visitors. 5.3.2 Sexual harassment or discrimination towards any employee, client, or visitor of COMPS. 5.3.3 Consuming or being under the influence of alcohol or illegal drugs while at work. 5.3.4 Commission of a felony which results in conviction. 5.3.5 Breach of any of the provisions of Sections 8 or 9 hereof. 5.3.6 Competition with COMPS (as defined in Section 11) by Employee. 2 CAC 5.3.7 Employee fails or refuses to faithfully and diligently perform the usual and customary duties of his employment which failure or refusal is not cured within 30 days after written notice thereof is given to Employee. 5.3.8 Employee fails or refuses to comply with the policies, standards and regulations of the Employer which from time to time may be established, which failure or refusal is not cured within 15 days after written notice thereof is given to Employee. 5.4 Resignation. At any time during the term of this Agreement, ----------- Employee may provide notice of his intent to resign. 5.5 Termination For Other Than Good Cause. COMPS may terminate ------------------------------------- Employee's employment at any time without good cause, upon written notice delivered to Employee that Employee's employment is being terminated for "other than good cause." It shall be deemed a termination by COMPS without good cause under this Paragraph 5.5 if Employee resigns within 30 days of having been removed from the position described in Paragraph 2 without his consent. 6. Compensation Upon Termination. ----------------------------- 6.1 Payment of Compensation Upon Termination For Good Cause. In the ------------------------------------------------------- event Employee is terminated for good cause, as set forth in Section 5.3, he/she shall receive two weeks' notice that his employment is terminated and Employee shall be entitled only to the compensation set forth as base salary herein, prorated through the date of said notice. When Employee is terminated for good cause as defined in Section 5.3, Employee is entitled to no other severance compensation arising out of this Agreement and out of his employment relationship with COMPS, and Employee shall permanently and absolutely forfeit all rights to all other benefits otherwise accruing by reason of Employee's employment by COMPS. 6.2 Payment of Compensation Upon Termination Other Than For Good ------------------------------------------------------------ Cause. In the event Employee's employment is terminated for other than ----- good cause, Employee shall receive Base Salary continuation in an amount described below, only if Employee executes a general release of claims in a form acceptable to COMPS, releasing any and all claims Employee has against COMPS arising out of his employment or the termination of said employment. Employee is not entitled to any Base Salary continuation pursuant to this Section unless he/she signs the general release described above. The Base Salary continuation described in this Section amounts to six months' base salary continuation at his then current Base Salary level if Employee's employment terminates for other than for good cause prior to November 1, 1995, seven months' Base Salary continuation if Employee's employment is terminated for other than good cause between November 1, 1995 and October 31, 1996, and eight months' Base Salary continuation at his then current Base Salary level if Employee's employment is terminated other than for good cause after October 31, 1996. Employee shall also be entitled to receive a pro rata share of his target bonus for that year if he is terminated for other than good cause. For instance, if the target bonus that year was $50,000.00, and 3 CAC Employee was terminated for other than good cause after three months, he would receive a $12,500.00 bonus upon termination. Employee is entitled to no other compensation when his employment is terminated for other than good cause. 7. Arbitration/Sole Remedy for Breach of Agreement. Except as provided in ----------------------------------------------- Section 8, in the event of any dispute between Employer and Employee concerning any aspect of the employment relationship, including any disputes upon termination, all such disputes shall be resolved by binding arbitration before a single neutral arbitrator. The arbitrator shall be selected from the American Arbitration Association through its procedures. All rules governing the arbitration shall be the rules as set forth by the American Arbitration Association. The arbitrator is bound to rule only on whether or not there has been a violation of the terms of this Agreement and to render an award, if any, that is consistent with the terms of this Agreement. Neither party to this Agreement is entitled to any legal recourse or rights or remedies other than those provided within this Agreement. The Employee's sole remedies for claims arising out of his employment, with the exception of Workers' Compensation remedies, are those set forth in this Agreement. In the event of a termination of employment, the arbitrator is limited to a determination of whether or not the discharge was for good cause or for other than good cause. If an arbitration is brought for something other than a termination of employment, the arbitrator is limited to award contract damages. The arbitrator may apportion the costs of the arbitration, including arbitrator's fees, among the parties, but shall have no power `to award attorneys' fees. Each party shall be responsible for its own attorneys' fees. 8. Trade Secrets. As used in this Section 8, "Trade Secrets" shall mean, ------------- without limitation, any document or information relating to COMPS' products, processes or services, including documents and information relating to Inventions, and to the research, development, engineering or manufacture of Inventions, and to COMPS, purchasing, customer or supplier lists, which documents or information have been disclosed to Employee or become known to Employee as a consequence (in whole or in part) of or through Employee's employment by COMPS (including documents, information or Inventions conceived, originated, discovered or developed by Employee), which is not generally known in the relevant trade or industry. "Inventions" shall mean discoveries, concepts, and ideas, whether patentable or copyrightable or not, including but not limited to processes, methods, formulas, techniques, devices, designs, programs (including computer programs), computer graphics, apparatus, products, as well as improvements thereof or know-how related thereto, relating to any present or anticipated business or activities of COMPS. 8.1 Acknowledgement of Proprietary Interest. Employee recognizes the --------------------------------------- proprietary interest of COMPS in all Trade Secrets. Employee acknowledges and agrees that any and all Trade Secrets, whether developed by Employee alone or in conjunction with others or otherwise, shall be and are the property of COMPS. 8.2 Covenant Not to Divulge Trade Secrets. Employee acknowledges and ------------------------------------- agrees that COMPS is entitled to prevent the disclosure of Trade Secrets. As a portion of the consideration for the employment of Employee and for the compensation being paid to Employee by COMPS, Employee agrees at all times during the term of the employment by COMPS and thereafter to hold in strictest confidence, and not to use, disclose or allow to be disclosed to any person, firm, or corporation, Trade Secrets, 4 CAC including Trade Secrets developed by Employee, other than disclosures to persons engaged by COMPS for the purpose of furthering the business of COMPS, or other than use in the pursuit of the business of COMPS. Specifically, Employee may disclose trade secrets to prospective alliance partners or prospective clients of COMPS. Employee shall obtain confidentiality, trade secret and/or proprietary information agreements from those prospective alliance partners or clients, before he discloses any trade secrets. 8.3 Confidential Information of Others. Employee represents and ---------------------------------- warrants that if Employee has any confidential information belonging to others, Employee will not use or disclose to COMPS any such information or documents. Employee represents that his employment with COMPS will not require him to violate any obligation to or confidence with any other party. 8.4 Injunctive Relief. Employee agrees that the breach of any ----------------- provision of Sections 8, 9 and/or 11 of this Agreement will cause COMPS irreparable injury and damage. Consequently, Employee agrees that because remedies at law may be inadequate to protect COMPS against breach of these provisions or this Agreement, COMPS shall be entitled, in addition to all other remedies available to it, to the granting of an injunction, including ex parte temporary relief, restraining Employee from violating Sections 8, 9 and/or 11 of this Agreement. The parties agree that a breach of Sections 8, 9 and/or 11 of this Agreement by Employee, which is alleged in a verified complaint or affidavit filed by COMPS with a proper court, shall entitle COMPS to the immediate issuance, without notice or hearing, of a temporary restraining order precluding the continuance of the conduct in question until a hearing on a preliminary injunction. A preliminary injunction may be issued by the court, without bond, upon a proper showing of: a) the breach; b) the confidential nature of the information, which may be shown by affidavit and in-camera to the court; c) ownership of the information by COMPS; and d) that the confidential or proprietary information was furnished to Employee or that Employee became aware of that information during his employment with COMPS. 9. No Adverse Use. Employee will not at any time use COMPS' Trade Secrets -------------- or Inventions in any manner which may directly or indirectly have an adverse effect upon COMPS' business, nor will Employee perform any acts which would tend to reduce COMPS' proprietary value in Trade Secrets or Inventions. 10. Return of Materials at Termination. In the event of any termination ---------------------------------- of Employee's employment, Employee or Employee's representative will promptly deliver to COMPS all materials, property, documents, data, and other information belonging to COMPS or pertaining to Trade Secrets or Inventions. Employee shall not take any materials, property, documents or other information, or any reproduction or excerpt thereof, belonging to COMPS or containing or pertaining to any Trade Secrets or Inventions. 11. Covenant Not to Compete. Employee agrees that, during Employee's ----------------------- employment, and during any period prior to which payments to Employee under Sections 5 and 6 and Exhibit B are completed, Employee will not directly or indirectly compete with COMPS in any way, or prepare to compete or assist any other person or entity to compete with COMPS in any way, and that Employee will not act as an officer, director, employee, consultant, more than 5 CAC three percent (3%) shareholder, significant lender, or agent of any other entity which is engaged in any business in California, Arizona, or Nevada of the same nature as, or in competition with, the business in which COMPS is now engaged or in which COMPS becomes engaged during the term of Employee's employment. 12. General Provisions. ------------------ 12.1 Payments. All payments due pursuant to the terms of this -------- Agreement shall be delivered in person, or by first class mail, postage prepaid to the last known address of the other party. Payments may be in lawful money of the United States, or may be made by check, draft or warrant of the paying entity. 12.2 Notices. Any notices to be given hereunder by either party to ------- the other may be effected by either personal delivery in writing, or by mail, registered or certified, postage prepaid with a return receipt requested. Mailed notices shall be addressed to the other party to the address appearing beneath the party's signature on this Agreement, but each party may change its address by written notice in accordance with this paragraph. Notices delivered personally shall be deemed communicated as of the date of delivery. 12.3 Complete Agreement. Employee acknowledges receipt of this ------------------ Agreement and COMPS' Employee Agreement Concerning Confidentiality, Trade Secrets, Outside Employment and Solicitation of BREIC Employees and agrees that these Agreements represent the entire Agreement with Employer concerning the subject matter hereof. These Agreements supersede any and all other Agreements, either oral or in writing, between the parties hereto with respect to the matters discussed herein of Employee and contain all of the covenants and agreements between the parties with respect to the terms and conditions of Employee's employment. Each party to these Agreements acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party or anyone acting on behalf of any party which are not embodied herein. 12.4 Severability. If any provision of this agreement is held by a ------------ court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way. 12.5 Other Benefits. Any amounts payable under this Agreement, other -------------- than Base Salary, shall not be deemed salary or other compensation for the purpose of computing benefits under any pension plan or other arrangement of COMPS for the benefit of its employees. 12.6 No Waiver. Either party's failure to enforce any provision of --------- this Agreement shall not in any way be construed as a waiver of any such provision, or prevent that party from thereafter enforcing each and every other provision of this Agreement. 6 CAC 12.7 Successors and Assigns. The rights and obligations of COMPS ---------------------- under this agreement shall inure to the benefit of and shall be binding upon the successors and assigns of COMPS. Employee shall not be entitled to assign any of his rights or obligations under this agreement. 12.8 Applicable Law. This agreement shall be interpreted, construed, -------------- governed and enforced in accordance with the laws of the state of California. 12.9 Amendments. No amendment or modification of the terms or ---------- conditions of this agreement shall be valid unless in writing and signed by the parties thereto. IN WITNESS WHEREOF, the parties hereto execute this Agreement, effective as of the date first above written EMPLOYEE: COMPS InfoSystems, INC., a California corporation /s/ Christopher A. Crane - -------------------------------- By: /s/ Christopher A. Crane Print Name and Address ------------------------ Its: Pres & CEO ------------------------ Christopher A. Crane - -------------------------------- 1880 Cam Monrovia - -------------------------------- La Jolla, CA 92037 - -------------------------------- 7 CAC EX-10.17 22 FORM OF EMPLOYMENT AGMNT DATED 11/6/98 Exhibit 10.17 FORM OF EMPLOYMENT AGREEMENT This Employment Agreement (this "Agreement") is made and entered into as of November 6, 1998, by and between COMPS INFOSYSTEMS, INC., a Delaware corporation (the "Company"), and ____________________, an individual (the "Executive"). RECITALS -------- WHEREAS, the execution and delivery of this Agreement by the Company and the Executive is a condition to the closing of that certain Asset Purchase Agreement (the "Purchase Agreement") of even date herewith, by and among the Company, the Executive, REALBID LLC, a California limited liability company, and [Robert Potter] [Emmett DeMoss], an individual; and WHEREAS, the Company and the Executive have determined that it is in their respective best interests to enter into this Agreement on the terms and conditions as set forth herein. NOW, THEREFORE, in consideration of the premises and the mutual covenants and promises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows (capitalized terms used herein and not expressly defined herein shall have the meanings assigned such terms in the Purchase Agreement): 1. EMPLOYMENT TERMS AND DUTIES --------------------------- 1.1 Employment. The Company hereby employs the Executive, and the ---------- Executive hereby accepts employment by the Company, upon the terms and conditions set forth in this Agreement. 1.2 Duties. The Company shall start a REALBID Division within the ------ Company and shall locate the executive office of the REALBID Division in Marin County and San Francisco County. The Executive shall serve as the Chairman of the REALBID Division and as the Vice President of the Company, with such powers and duties appropriate to those positions as may be provided in the Bylaws of the Company, and as determined by the Board of Directors of the Company (the "Board") from time to time. Such duties will include, without limitation, planning, management, operations, sales and marketing, product development and enhancement and overall supervision of the REALBID Division. During the term of his employment hereunder, the Executive shall devote his full working time and efforts to the performance of his duties to the Company and shall not be or occupied with non-Company activities during his working time or otherwise employed at any time during the term of this Agreement. The Executive shall use his best efforts in the performance of his duties and the furtherance of the interests of the Company. The Executive shall at all times discharge his duties under the supervision and direction of the Chief Executive Officer of the Company or his designee. The Executive will annually present a business plan, and quarterly present revised two year projections of the same, to the Chief Executive Officer. 1.3 Term. Subject to the provisions Section 1.5 below, the term of ---- ----------- employment of the Executive under this Agreement shall commence on the date hereof and terminate on January 1, 2003 (the "Employment Term"). Upon termination of the Employment Term, the Executive's employment with the Company and the Company's obligation to employ the Executive in any capacity shall cease in any and all manner. 1.4 Compensation and Benefits. ------------------------- 1.4.1 Base Salary. In consideration of the services rendered to the ----------- Company hereunder by the Executive and the Executive's covenants hereunder, including but not limited to, his covenants under Sections 2 and 3 below, the ---------- - Company shall, during the Employment Term, pay the Executive a salary at the annual rate of Two Hundred Twenty-Five Thousand Dollars ($225,000) (the "Base Salary"). The Base Salary shall be payable in accordance with the normal payroll practices of the Company then in effect. The Base Salary and all other forms of compensation paid to the Executive hereunder shall be subject to all applicable taxes required to be withheld by the Company pursuant to federal, state or local law. The Company, in its sole discretion, may (i) increase the Base Salary from time to time and (ii) pay the Executive a cash bonus in such amount (which amount may be zero or up to fifty thousand dollars ($50,000)) as may be determined by the Board or a committee of the Board. The Executive shall be solely responsible for income taxes imposed on the Executive by reasons of any cash or non-cash compensation and benefits provided by this Agreement. 1.4.2 Stock Options. Executive shall be granted (i) incentive stock ------------- options (the "Options") to purchase 416,666.5 shares of the Company's Class B Common Stock (the "Incentive Option Shares") and (ii) non-statutory stock options to purchase 6,920.5 shares of the Company's Class B Common Stock (the "Non-Statutory Option Shares," and together with the Incentive Option Shares, the "Option Shares"), as set forth in detail in such Executive's Notice of Grant of Stock Option attached hereto as Exhibit A (the "Notice of Grant"). Executive shall acquire a vested interest in (i) 20% of the Incentive Option Shares on the date of this Agreement (the "Vesting Commencement Date"), (ii) 100% of the Non-Statutory Options Shares on the Vesting Commencement Date and (iii) the remaining 80% of the Incentive Option Shares shall vest in successive equal monthly installments over a forty-eight (48) month period commencing on January 1, 1999. 1.4.3 Benefits Package. In addition to the Base Salary, during the ---------------- Employment Term, the Executive shall be entitled to receive such pension, profit sharing, bonus, life insurance, hospitalization, major medical, and other benefit plans of the Company as may be in effect from time to time as are afforded to other comparable executives of the Company. 1.4.4 Vacation. The Executive shall be entitled to vacation each -------- fiscal year accruing at 1.25 days per month for an annual accrual of fifteen (15) days. The maximum number of unused vacation days which may be accrued at any one time shall be one hundred eighty (180) days. 1.4.5 Expenses. The Company shall, upon receipt from the Executive -------- of signed and itemized lists of expenditures with supporting receipts to the extent required by applicable income tax regulations and the Company's reimbursement policies, reimburse the 2 Executive for all out-of-pocket business expenses reasonably incurred by the Executive in connection with his employment hereunder. 1.5 Termination. The Executive's employment and this Agreement ----------- (except as otherwise provided hereunder) shall terminate upon the occurrence of any of the following, at the time set forth therefor (the "Termination Date"): 1.5.1 Voluntary Termination. Thirty (30) days following the --------------------- Employee's written notice to the Company of termination of employment; provided, -------- however, that the Company may waive all or a portion of the thirty (30) days' - ------- notice and accelerate the effective date of such termination (and the Termination Date) (termination pursuant to this Section 1.5.1 being referred to ------------- herein as "Voluntary Termination"); 1.5.2 Termination For Cause. Immediately following written notice of --------------------- termination for "Cause" (as defined below), specifying such Cause (as determined in good faith by the Board), given by the Company (termination pursuant to this Section 1.5.2 being referred to herein as termination for "Cause"). As used - -------------- herein, "Cause" means termination based on (i) the Executive's material breach of this Agreement or any significant material written policy or procedure of the Company, including but not limited to, policies concerning equal employment opportunity and harassment in the workplace, (ii) conviction of the Executive for (x) any crime constituting a felony in the jurisdiction in which committed, (y) any crime involving moral turpitude (whether or not a felony), or (z) any other violation of criminal law involving dishonesty or willful misconduct which injures the Company (whether or not a felony), (iii) substance abuse by the Executive which in any material manner interferes with the performance of his duties under this Agreement, (iv) the failure or refusal of the Executive to follow the lawful and proper directives of the Board which are within the scope of the Executive's duties set forth in Section 1.2 above and which is not ----------- corrected within seven (7) days after written notice to the Executive identifying such failure or refusal, (v) willful malfeasance or gross misconduct by the Executive which discredits or damages the Company, including, without limitation, any breach of his obligations under Section 2 or Section 3 below, --------- --------- (vi) indictment of the Executive by a grand jury for a felony violation of the federal securities laws, (vii) the Executive's willful breach or habitual neglect of duties as an employee of the Company (including, but not limited to chronic absence from work for reasons other than illness), (viii) conduct by the Executive for which the Company incurs civil liability in excess of fifty thousand dollars ($50,000) in the aggregate to any other employee or third party or be assessed any fine or penalty by a governmental agency or (ix) the death or Disability of the Executive. For the purposes of this Agreement, "Disability" means the Board's good faith determination that the Executive has been unable to perform any material portion of his duties under this Agreement for a period of thirty (30) consecutive days, or sixty (60) days in the aggregate during the Employment Term, with or without reasonable accommodation, due to physical or mental illness or incapacity. 1.5.3 Termination Without Cause. Only after the completion of the ------------------------- first twelve months of this Agreement, five days following written notice of termination without Cause given by the Company; provided, however, that the Executive shall be retained by the Company as a consultant and shall receive payment of Base Salary and Option Shares as provided in Section 1.6.2 below ------------- (termination pursuant to this Section 1.5.3 being referred to herein as ------------- termination "Without Cause"). Notwithstanding anything to the contrary contained 3 herein, including without limitation Section 1.5.2(iv) hereof, the Executive ----------------- shall not be required to relocate from Marin County or San Francisco County to any other area and any such required relocation shall constitute a termination Without Cause as set forth in this Section 1.5.3. ------------- 1.5.4 Other Remedies. Termination pursuant to Section 1.5.2 -------------- ------------- above shall be in addition to and without prejudice to any other right or remedy to which the Company may be entitled at law, in equity, or under the Agreement. 1.6 Severance and Termination. ------------------------- 1.6.1 Termination for Cause or Voluntary Termination. In the ---------------------------------------------- case of a Voluntary Termination or a termination of the Executive's employment hereunder for Cause in accordance with Section 1.5.2 above at any time (i) the ------------- Executive shall not be entitled to receive payment of, and the Company shall have no obligation to pay any severance or similar compensation attributable to such termination other than Base Salary earned but unpaid as of the Termination Date or otherwise as required by law, (ii) the vesting of the Option Shares shall terminate as of the date of the termination of the Executive's employment hereunder and (iii) the Company's obligations under this Agreement shall immediately cease. 1.6.2 Termination Without Cause. ------------------------- (a) In the case of a termination of the Executive's employment hereunder Without Cause in accordance with Section 1.5.3 above within the two ------------- year period following the date of this Agreement: (1) The Company shall pay the Executive an amount equal to his then applicable Base Salary for a period of one (1) year commencing on the Termination Date (the "Post-Termination Period"), payable at the times and subject to the tax withholding specified in Section 1.4.1 above; provided, ------------- -------- however, that the payment of such salary shall be paid only if the Executive - ------- executes and delivers to the Company the Confidential Separation Agreement and General Release substantially in the form of Exhibit B attached hereto (the --------- "Separation and Release Agreement") and does not revoke the Separation and Release Agreement pursuant to the terms of the same. (2) The Company will retain the Executive as a full-time consultant for the first six months of the Post-Employment Period and as a part- time consultant for the remaining six months of the Post-Employment Period (i.e. on call for a specified number of hours per week). Except for the continuation of his salary payments pursuant to Section 1.6.2.(a)(1) above, the Executive -------------------- shall not receive any kind of consideration, payment or benefits for his consulting services rendered pursuant to this Agreement. (b) In the case of a termination of the Executive's employment hereunder Without Cause in accordance with Section 1.5.3 above after the two ------------- year period following the date of this Agreement: (1) The Company shall pay the Executive an amount equal to his then applicable Base Salary for a period equal to the shorter of (x) six (6) months commencing on the Termination Date and (y) the remaining term of his employment (the 4 "Shortened Post-Termination Period"), payable at the times and subject to the tax withholding specified in Section 1.4.1 above; provided, however, that ------------- -------- ------- the payment of such salary shall be paid only if the Executive executes and delivers to the Company the Separation and Release Agreement and does not revoke the Separation and Release Agreement pursuant to the terms of the same. (2) The Company will retain the Executive as a part-time consultant during the Shortened Post-Termination Period. Except for the continuation of his salary pursuant to Section 1.6.2(b)(1) above, the Executive ------------------- shall not receive any kind of consideration, payment or benefit for his consulting services rendered pursuant to this Agreement. (c) Notwithstanding any provision to the contrary set forth herein, in Executive's Notice of Grant of Stock Option, the Incentive Stock Option Agreement or the Non-Statutory Option Agreement referenced in such Notice of Grant: (1) If the Executive is terminated Without Cause in accordance with Section 1.5.3 within the two year period following the date of this ------------- Agreement, the Executive's Option Shares shall continue to vest pursuant to the Notice of Grant during the Post-Termination Period; provided, however, that if -------- ------- the aggregate number of Options Shares in which the Executive will acquire a vested interest at the end of the Post-Termination Period would not equal at least seventy-five percent (75%) of Option Shares, then the vesting schedule described in the Notice of Grant will be adjusted to provide for the vesting of an aggregate of seventy-five percent (75%) of the Option Shares at the end of the Post-Termination Period; provided further, that such adjusted vesting ---------------- schedule shall continue to provide for vesting in successive equal monthly installments during the Post-Termination Period. (2) If the Executive is terminated Without Cause in accordance with Section 1.5.3 after the two year period following the date of the ------------- Agreement, the Executive's Option Shares shall continue to vest pursuant to the Notice of Grant during the Shortened Post-Termination Period only if the Executive will not have acquired a vested interest in at least seventy-five percent (75%) of the Option Shares as of the Termination Date, in which case the vesting schedule described in the Notice of Grant will be adjusted to provide for the vesting of an aggregate of seventy-five percent (75%) of the Option Shares at the end of the Shortened Post-Termination Period; provided further, ---------------- that such adjusted vesting schedule shall continue to provide for vesting in successive equal monthly installments during the Shortened Post-Termination Period. (d) Notwithstanding anything to the contrary herein: (1) The Company's obligation to (i) pay the Executive the salary under Section 1.6.2(a)(1) above or Section 1.6.2(b)(1) above and (ii) retain the ------------------- ------------------- Executive as a consultant under Section 1.6.2(a)(2) above or Section 1.6.2(b)(2) ------------------- ------------------- above shall cease immediately in the event of the Executive's breach of his obligations under Section 2 above or Section 3 above or, if applicable, the --------- --------- Executive's breach of his obligations under the Non-Competition Agreement of even date herewith by and between the Company and the Executive (the "Non- Competition Agreement"). 5 (2) The vesting of the Executive's Option Shares under Sections 1.6.2(c)(1) and (2) above shall cease immediately in the event of the - ----------- --- Executive's breach of his obligations under Section 2 above or Section 3 above --------- --------- or, if applicable, the Executive's breach of his obligations under the Non- Competition Agreement. 1.6.3 Termination Complete. It is expressly acknowledged by the -------------------- Executive that, except as provided in Sections 1.6.2(a)(1) and 1.6.2(b)(1) -------------------- ----------- above, the provisions of this Section 1.6 shall have the effect of eliminating ----------- all compensation (salary, stock options, bonuses, and benefits) which would have been paid or available had such employment relationship not been terminated. 2. CONFIDENTIAL INFORMATION - NON-DISCLOSURE ----------------------------------------- 2.1 Definition of Confidential Information. The Executive hereby -------------------------------------- acknowledges that during the Executive's employment hereunder, the Executive may have access to, make use of, acquire, create, develop or add to certain confidential and proprietary information regarding the Company or any company owned by or affiliated with the Company (collectively, the "COMPS Group") (whether in existence prior to, as of or after the date hereof, including without limitation any confidential and proprietary information that the Company purchased from REALBID LLC under the Purchased Agreement) (collectively, "Confidential Information"), which Confidential Information shall include, without limitation, all of the following materials and information (whether or not reduced to writing and whether or not patentable or protected by copyright): (i) any and all trade secrets concerning the business and affairs of any member of the COMPS, product specifications, data, procedures, know-how, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions, models, documentation, techniques, diagrams, flowcharts, new products and new technology information, product prototypes, product copies, manufacturing, development or marketing techniques, material development or marketing timetables, strategies and development plans, and ideas, past, current and planned research and development, current and planned manufacturing and distribution methods and processes, customer lists, current and anticipated customer requirements, price lists, market studies, business plans, computer software and programs (including object code and source code), computer software and database technologies and information (including without limitation confirmed sales transactions, buyer and seller information, listings, space availability and tenant and lease comparables), systems, structures and architectures (and related processes, formulae, compositions, improvements, devices, know-how, inventions, discoveries, concepts, ideas, designs, methods and information) of any member of the COMPS Group including but not limited to information related to the customers, suppliers or personnel of such members of the COMPS Group, and any other information, however, documented, of any member of the COMPS Group that is a trade secret within the meaning of any and all applicable state and federal trade secret laws; (ii) any and all information concerning the business and affairs of any member of the COMPS Group (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel and personnel training and techniques and materials), however documented; and (iii) any and all notes, analysis, compilations, studies, summaries, and other material prepared by or for any member of the COMPS Group containing or based, in whole or in part, on any information included in the foregoing. The parties hereto agree that the failure of any Confidential Information to be marked 6 or otherwise labeled as confidential or proprietary information shall not affect its status as Confidential Information. Notwithstanding the foregoing, Confidential Information shall not include any information (i) which is generally known to the public or to companies in businesses similar to the Company's business (except for the companies which license such Confidential Information from any member of the COMPS Group), (ii) which later, through no act of any of the Executive, REALBID, or the other parties to the Asset Purchase Agreement, becomes generally known or (iii) information required to be disclosed by the Executive pursuant to a subpoena or court order, or pursuant to a requirement of a governmental agency or law of the United States of America or a state thereof or any governmental or political subdivision thereof, provided that (a) the Executive will provide the Company with prior written notice of such disclosure in order that the Company may attempt to obtain a protective order or the assurance of confidential treatment and (b) the Executive will cooperate with the Company in attempting to obtain such order or assurance. 2.2 The Executive Covenant. In consideration of the Company's ---------------------- entering into this Agreement and providing the Base Salary, the Option Shares and other benefits to the Executive, and further in consideration of the Executive's continued exposure to the Confidential Information and the Executive's continued receipt of specialized training from members of the COMPS Group, the receipt of which are hereby acknowledged by the Executive, the Executive covenants as follows: 2.2.1 Non-Use and Non-Disclosure. Commencing on the date hereof and -------------------------- at all times thereafter, the Executive shall hold in the strictest confidence (except as previously approved by the Company in writing), and shall not, directly or indirectly, disclose, divulge, reveal, report, publish, transfer or otherwise communicate, or use for his own benefit or the benefit of any other person, partnership, firm, corporation or other entity, or use to the detriment of any member of the COMPS Group, or misuse in any way, any Confidential Information. The Executive acknowledges that he will in no way infringe upon any COMPS copyrights and will in no way use, copy, appropriate or redistribute any part of the Confidential Information, whether obtained directly or indirectly from COMPS, without a specific written license agreement with COMPS. It is agreed that any derivative, modification or elaboration of any Confidential Information by any third party remains the proprietary property of COMPS for purposes of this Agreement. The Executive and the Company each hereby stipulates that, as between them, all Confidential Information constitutes important material and confidential and/or proprietary information of the Company's, constitutes unique and valuable information, and affects the successful conduct of the Company's business and the goodwill of the COMPS Group, and that members of the COMPS Group shall be entitled to recover their respective damages, in addition to any injunctive remedy that may be available, for any breach of this Section 2. --------- 2.2.2 Trade Secrets. All trade secrets of the COMPS Group will be ------------- entitled to all of the protection and benefits under all applicable federal and state trade secrets law. If any information that any member of the COMPS Group deems to be a trade secret is found by a court of competent jurisdiction not to be a trade secret for purposes of this Agreement, such information will, nevertheless, be considered Confidential Information for purposes of this Agreement. The Executive hereby waives any requirement that the members of the COMPS Group submit proof of the economic value of any trade secret or post a bond or 7 other security. The Executive hereby acknowledges that the database technologies and information (including without limitation confirmed sales transactions, buyer and seller information, listings, space availability and tenant and lease comparables) shall be considered a trade secret of the COMPS Group. 2.2.3 Ownership. The Executive hereby acknowledges and agrees that --------- all right, title and interest in and to any Confidential Information shall be and shall remain the exclusive property of the COMPS Group, and that any Confidential Information which the Executive acquires from any member of the COMPS Group was received in confidence and as a fiduciary of such member of the COMPS Group. Without limiting the foregoing, the Executive shall assign to the COMPS Group, any and all right, title or interest which the Executive may have in all Confidential Information made, developed or conceived of in whole or in part by the Executive during his employment hereunder. The Executive further agrees to execute and deliver any and all instruments, and to do all other things reasonably requested by any member of the COMPS Group (both during and after the his employment hereunder) in order to vest more fully in such member of the COMPS Group all ownership rights in such Confidential Information. All equipment, notebooks, documents, memoranda, reports, files, samples, books, correspondence, lists, other written and graphic records, and the like, in any way relating to any Confidential Information, the business of the Company or its activities, which the Executive shall prepare, use, construct, observe, process, or control (collectively, "Materials") shall be and shall remain the COMPS Group's exclusive property, and the Executive hereby agrees to deliver all Materials, together with any and all copies thereof, promptly to the Company on behalf of the COMPS Group upon the termination of this Agreement for any reason. The Executive further agrees that any property situated on the Company's premises and owned by the Company, including disks and other storage media, filing cabinets or other work areas, is subject to inspection by Company personnel at any time with or without notice. 2.2.4 Other Obligations. The Executive acknowledges that the COMPS ----------------- Group, from time to time, may have agreements with other persons, entities or with the U.S. Government or agencies thereof, which imposes obligations or restrictions on the COMPS Group regarding inventions made during the course of work thereunder, or regarding the confidential nature of such work. The Executive hereby agrees to be bound by all such obligations or restrictions and to take all action necessary to discharge the obligations of the COMPS Group thereunder. 3. NON-COMPETITION AND NON-INTERFERENCE ------------------------------------ 3.1 Covenant of the Executive. In consideration of the Company's ------------------------- entering into this Agreement and providing the Base Salary, Option Shares and other benefits to the Executive, and further in consideration of the Executive's continued exposure to the Confidential Information and the Executive's continued receipt of specialized training from the members of the COMPS Group, the receipt of which are hereby acknowledged by the Executive, the Executive covenants as follows: 3.1.1 Non-Competition. During the Executive's employment --------------- hereunder and the Severance Period, the Executive shall not, directly or indirectly, own, manage, engage in, operate or conduct, prepare to or plan to conduct or assists any person or entity to conduct any 8 business, or have any interest in any business, person, firm, corporation or other entity (as a principal, owner, agent, employee, shareholder, officer, director, joint venturer, partner, security holder) (except for the ownership of publicly-traded securities constituting not more than five percent (5%) of the outstanding securities of the issuer thereof), creditor (except for trade credit extended in the ordinary course of business), consultant or in any other capacity that engages in any business which is the same as, similar to or competitive with the business of any member of the COMPS Group including without limitation the commercial real estate information business, which shall include among other things, buyer/seller matching, transaction facilitation, listing services, sales comparables, lease comparables, space availability, tenant information, property inventory, property characteristics, automated valuation models and city and regional market overviews (collectively, the "Business"), anywhere in the United States. The covenants set forth in this Section 3.1.1 ------------- shall be construed as a series of separate covenants covering their subject matter in each of the separate states where the Company conducts the Business, and except for geographic coverage, each such separate covenant shall be deemed identical in terms to the covenant set forth above in this Section 3.1.1 To the ------------- extent that any such covenant shall be judicially unenforceable in any one or more of such states, such covenant shall not be affected with respect to each of the other states. Each covenant with respect to such states shall be construed as severable and independent. 3.1.2 No Diversion of Others. During the Executive's employment ---------------------- hereunder and the Severance Period, the Executive shall not, either for himself or for any other person, firm, corporation or other entity, directly or indirectly, or by action in concert with others: (a) induce or influence, or seek to induce or influence, any Person who is engaged by any member of the COMPS Group (as an agent, employee, consultant, or in any other capacity) or any successor thereto with the purpose of obtaining such person as an employee or customer for a business competitive with any member of the COMPS Group's business; or (b) divert or take away or attempt to divert or take away, or solicit or attempt to solicit, any existing or potential customer of any member of the COMPS Group (whether or not such customer is actually a customer of any member of the COMPS Group as of the date hereof, including without limitation any customer solicited by the Executive or which became known by the Executive prior to the date hereof) with the purpose of obtaining such person as an employee or customer for a business competitive with any member of the COMPS Group's Business. 3.1.3 Organizing Competitive Business. Without limiting any of the ------------------------------- other provisions contained in this Section 3, during the Executive's employment --------- hereunder and the Severance Period, the Executive shall not undertake planning for or organization of any business activity competitive with the Business of any member of the COMPS Group, or conspire with agents, employees, consultants or other representatives of any member of the COMPS Group for the purpose of organizing any such competitive business activity. 9 4. INJUNCTIVE RELIEF AND ADDITIONAL REMEDY --------------------------------------- 4.1 In General. The Executive acknowledges and agrees that members ---------- of the COMPS Group shall suffer irreparable harm in the event that the Executive breaches any of his obligations under Sections 2 or 3 hereof, and that monetary ---------- - damages shall be inadequate to compensate the damaged members of the COMPS Group for any such breach. Accordingly, the Executive agrees that in the event of any breach or threatened breach by the Executive of any of the provisions of Sections 2 or 3 hereof, the damaged members of the COMPS Group shall be entitled - ---------- - to a temporary restraining order, preliminary injunction and permanent injunction in order to prevent or restrain any such breach or threatened breach by the Executive, or by any or all of the Executive's agents, representatives or other persons directly or indirectly acting for, on behalf of or with the Executive, without having to prove damages. 4.2 No Limitation of Remedies. Notwithstanding the provisions set ------------------------- forth in Section 4.1 above, or any other provision contained in this Agreement, ----------- the parties hereby agree that no remedy conferred by any of the specific provisions of this Agreement, including, without limitation, this Section 4, is --------- intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise. 5. REASONABLENESS OF RESTRICTIONS. ------------------------------ THE EXECUTIVE HAS CAREFULLY READ AND CONSIDERED THE PROVISIONS OF SECTIONS 2 AND 3 HEREOF AND, HAVING DONE SO, HEREBY AGREES THAT THE RESTRICTIONS - ----------- - SET FORTH IN SUCH SECTIONS ARE FAIR AND REASONABLE AND ARE REASONABLY REQUIRED FOR THE PROTECTION OF THE INTERESTS OF THE COMPANY. 6. REPRESENTATIONS AND WARRANTIES ------------------------------- 6.1 By the Executive. The Executive represents and warrants to the ---------------- Company that (i) this Agreement is valid and binding upon and enforceable against him in accordance with its terms, (ii) the Executive is not bound by or subject to any contractual or other obligation that would be violated by his execution or performance of this Agreement, including, but not limited to, any non-competition agreement presently in effect, and (iii) the Executive is not subject to any pending or, to the Executive's knowledge, threatened claim, action, judgment, order or investigation that could adversely affect his ability to perform his obligations under this Agreement or the business reputations of the Company. 6.2 By the Company. The Company represents and warrants to the -------------- Executive that (i) this Agreement is valid and binding upon and enforceable against the Company in accordance with its terms, (ii) the Company is not bound by or subject to any contractual or other obligation that would be violated by its execution or performance of this Agreement, including, but not limited to, any non-competition agreement presently in effect, and (iii) the Company is not subject to any pending, or to the Company's knowledge, threatened claim, action, judgement, order or investigation that could adversely affect its ability to perform its obligations under this Agreement. 10 7. SURVIVAL OF CERTAIN RIGHTS AND OBLIGATIONS ------------------------------------------ Sections 2, 3 and 6 above shall survive any termination of this ---------- - - Agreement and continue in full force and effect as is necessary or appropriate to enforce the covenants and agreements of the Executive in Sections 2, 3 and 6. ---------- - - The existence of any claim or cause of action by the Executive against the Company, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company of the covenants and agreements of Sections 2, 3 and 6 above. - ---------- - - 8. MISCELLANEOUS ------------- 8.1 Notices. All notices, requests and other communications ------- hereunder must be in writing and will be deemed to have been duly given only if delivered personally against written receipt or by facsimile transmission with answer back confirmation or mailed (postage prepaid by certified or registered mail, return receipt requested) or by overnight courier to the parties at the following addresses or facsimile numbers: If to the Executive, to: __________________________________ __________________________________ __________________________________ __________________________________ If to the Company, to: COMPS InfoSystems, Inc. 9888 Carroll Centre Road, Suite 100 San Diego, CA 92126 Facsimile No.: (619) 684-3292 Attention: Mr. Christopher A. Crane All such notices, requests and other communications will (i) if delivered personally to the address as provided in this Section 8.1, be deemed given upon ----------- delivery, (ii) if delivered by facsimile transmission to the facsimile number as provided in this Section 8.1, be deemed given upon receipt, and (iii) if ----------- delivered by mail in the manner described above to the address as provided in this Section 8.1, be deemed given upon receipt (in each case regardless of ----------- whether such notice, request or other communication is received by any other Person to whom a copy of such notice, request or other communication is to be delivered pursuant to this Section). Any party from time to time may change its address, facsimile number or other information for the purpose of notices to that party by giving notice specifying such change to the other parties hereto. 8.2 Obligations Contingent on Performance. The obligations of the ------------------------------------- Company hereunder, including its obligation to pay the compensation provided for herein, are contingent upon the Executive's performance of his obligations hereunder. 11 8.3 Entire Agreement. This Agreement, the Purchase Agreement and the ---------------- documents executed in connection with the Purchase Agreement, including, without limitation, the Non-Competition Agreement, supersede all prior discussions and agreements among the parties with respect to the subject matter hereof and contain the sole and entire agreement between the parties hereto with respect thereto. 8.4 Waiver. Any term or condition of this Agreement may be waived at ------ any time by the party that is entitled to the benefit thereof, but no such waiver shall be effective unless set forth in a written instrument duly executed by or on behalf of the party waiving such term or condition. No waiver by any party hereto of any term or condition of this Agreement, in any one or more instances, shall be deemed to be or construed as a waiver of the same or any other term or condition of this Agreement on any future occasion. All remedies, either under this Agreement or by law or otherwise afforded, will be cumulative and not alternative. 8.5 Amendment. This Agreement may be amended, supplemented or --------- modified only by a written instrument duly executed by or on behalf of each party hereto. 8.6 No Third Party Beneficiary. The terms and provisions of this -------------------------- Agreement are intended solely for the benefit of each party hereto and the Company's successors or assigns, and it is not the intention of the parties to confer third-party beneficiary rights upon any other Person. 8.7 No Assignment; Binding Effect. This Agreement is binding upon, ----------------------------- inures to the benefit of and is enforceable by the parties hereto and any successors or assigns of the Company. The Executive shall not be entitled to assign his right, interest or obligations under this Agreement without the prior written consent of the Company. 8.8 Headings. The headings used in this Agreement have been inserted -------- for convenience of reference only and do not define or limit the provisions hereof. 8.9 Severability. The Company and Executive intend all provisions of ------------ this Agreement to be enforced to the fullest extent permitted by law. Accordingly, if a court of competent jurisdiction determines that the scope and/or operation of any provision of this Agreement is too broad to be enforced as written, the Company and Executive intend that the court should reform such provision to such narrower scope and/or operation as it determines to be enforceable. If, however, any provision of this Agreement is held to be illegal, invalid, or unenforceable under present or future law, and not subject to reformation, then (i) such provision shall be fully severable, (ii) this Agreement shall be construed and enforced as if such provision was never a part of this Agreement, and (iii) the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by illegal, invalid, or unenforceable provisions or by their severance. 8.10 Governing Law. This Agreement shall be governed by and ------------- construed in accordance with the laws of the State of California applicable to contracts executed and performed in such State, without giving effect to conflicts of laws principles. 8.11 Arbitration. Except as otherwise provided in Section 4 above, ----------- --------- the Executive agrees that any and all disputes that the Executive has with the Company or any of its 12 employees, which arise out of the Executive's employment, the termination of employment, or under the terms of this Agreement, shall be resolved through final and binding arbitration. This shall include, without limitation, disputes relating to this Agreement, any disputes regarding the Executive's employment by the Company or the termination thereof, claims for breach of contract or breach of the covenant of good faith and fair dealing, and any claims of discrimination or other claims under any federal, state or local law or regulation now in existence or hereinafter enacted and as amended from time to time concerning in any way the subject of the Executive's employment with the Company or its termination. The only claims not covered by this Section 8.11 are claims for ------------ benefits under the workers' compensation laws or unemployment insurance laws and any claims arising from the Executive's breach of Sections 2 or 3 of this ---------- - Agreement. Binding arbitration will be conducted in San Diego, California, in accordance with the rules and regulations of the American Arbitration Association. Each party will bear one half of the cost of the arbitration filing and hearing fees, and the cost of the arbitrator. Each party will bear its own attorneys' fees, unless otherwise decided by the arbitrator. The Executive understands and agrees that the arbitration shall be instead of any civil litigation and that the arbitrator's decision shall be final and binding to the fullest extent permitted by law and enforceable by any court having jurisdiction thereof. Each party shall be entitled to pre-hearing discovery as provided in California Code of Civil Procedure Section 1283.05. 8.12 Counterparts. This Agreement may be executed in any number of ------------ counterparts and by facsimile, each of which will be deemed an original, but all of which together will constitute one and the same instrument. [SIGNATURE PAGE TO FOLLOW] 13 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the date first written above. "COMPANY" COMPS INFOSYSTEMS, INC. a Delaware corporation By: ---------------------- Name: ---------------------- Title: ---------------------- "EXECUTIVE" ----------------------------- EXHIBIT A NOTICE OF GRANT See Exhibit 10.34 to Registration Statement on Form S-1 EXHIBIT B CONFIDENTIAL SEPARATION AGREEMENT AND GENERAL RELEASE (Employee) and COMPS InfoSystems, Inc. (COMPS - Employer) agree to terminate their employment relationship on the following basis: 1. (Employee) and COMPS agree that (Employee) shall separate his/her employment with COMPS effective (Date). (Employee) will return all of COMPS' keys, records, and files (electronic or other) on (Date) and will cooperate fully with COMPS' managers and employees in a professional manner to assure a smooth transition. 2. In consideration for (Employee)'s agreement and commitments herein, COMPS will provide (Employee) with the following additional consideration to which he/she is not otherwise entitled: a) Additional compensation and stock options, if any, as described in the Employment Agreement between Employee and COMPS, dated ________, so long as (Employee) has not revoked this Separation Agreement during the preceding seven (7) days. b) Outplacement services to be provided by Drake, Beam, Morin, Inc. 3. (Employee) agrees that he/she is not entitled to receive, and will not claim, any right, benefit or compensation other than what is expressly set forth in Paragraph 2 above, and hereby expressly waives any claim to any compensation, benefit or payment whatsoever except as expressly referenced in Paragraph 2 hereof. 4. (Employee) and COMPS promise not to disparage each other in any manner and Employee promises not to use or disclose any confidential information he learned while employed by COMPS. (Employee) further agrees that he/she will not solicit, participate in or assist in any way the solicitation of any employees of COMPS to cease employment or doing present or future business with COMPS. (Employee) and COMPS further agree to keep this agreement and its contents in complete confidence and not to disclose the fact or amount of these additional payments to any past, present or prospective employee of COMPS. The terms of this Agreement are confidential and shall not be divulged to any party without the prior written consent of the non-disclosing party, which shall not be unreasonably withheld; provided, however, that COMPS and (Employee) can disclose -------- ------- the details of this Agreement to their respective counsel. 5. In consideration of the compensation set forth in Paragraph 2, (Employee) does hereby unconditionally, irrevocably and absolutely release and discharge COMPS, its owners, directors, officers, employees, agents, attorneys, stockholders, insurers, divisions, successors and/or assigns and any related holding, parent or subsidiary corporations, from any and all loss, liability, claims, demands, causes of action, or suits of any type, whether in law and/or in equity, related directly or indirectly of in any way connected with any transaction, affairs or occurrences B-1 between them to date, including, but not limited to, (Employee)'s employment with COMPS, and the termination of said employment. In further consideration thereof, (Employee) irrevocably and absolutely agrees that she will not prosecute nor allow to be prosecuted on her behalf in any administrative agency, whether federal or state, or in any court, whether federal or state, any claim or demand of any type related to the matter released above, it being an intention of the parties that with the execution by (Employee) of this Release, COMPS, its owners, officers, directors, employees, agents, attorneys, successors and/or assigns and all related holding, parent and subsidiary corporations will be absolutely, unconditionally and forever discharged of and from all obligations to or on behalf of (Employee) related in any way to the matter discharged herein. 6. This Separation Agreement is intended by the parties to release and discharge any and all claims of (Employee) against COMPS InfoSystems, Inc. including, but not limited to, any claims arising under the Age Discrimination in Employment Act, 29 U.S.C. 621 et seq. It is the intent of the parties that ------ this Separation Agreement satisfy the requirements of the Older Workers Benefit Protection Act, Public Law 101-433, codified at 29 U.S.C. 626(f). The following general provisions, along with the other provisions of the Separation Agreement, are agreed to for this purpose: a. (Employee) acknowledges and agrees that he has read and he understands the terms of this Separation Agreement. b. (Employee) acknowledges that he has been given a full opportunity to consult with his lawyer with respect to the matters referenced in this Separation Agreement, and that (Employee) has obtained and considered such legal counsel as he deems necessary, such that (Employee) is entering into this Separation Agreement freely, knowingly, and voluntarily; c. (Employee) acknowledges that he has been given at least 21 days in which to consider whether or not to enter into this Separation Agreement; d. (Employee) may revoke Separation Agreement during the seven (7) day period following the execution of this Separation Agreement. If not revoked, this Separation Agreement shall become effective eight (8) days after (Employee) signs this Separation Agreement. 7. It is further understood and agreed that as a condition of this settlement, all rights under Section 1542 of the Civil Code of the State of California are expressly waived by (Employee). Such Section reads as follows: "A General Release does not extend to claims which the creditor does not know or suspect to exist in her favor at the time of executing the release, which if known by her must have materially affected her settlement with the debtor." A-2 (Employee) does certify that he has read all of this Release, the quoted Civil Code section and that he fully understands all of the same. (Employee) hereby expressly agrees that this Release shall extend and apply to all unknown, unsuspected and unanticipated injuries and damages, as well as to any that are now alleged. 8. This Agreement contains all of the terms, promises, representations and understandings made between the parties. (Employee) agrees that no promises, coercion, representations or inducements have been made which caused him to sign this Agreement other than those which are expressly set forth above and that the terms of this Agreement are contractual and not a mere recital. 9. (Employee) agrees that any and all disputes that (Employee) has with COMPS or any of its employees, which arise under the terms of this Agreement, shall be resolved through final and binding arbitration. This shall include, without limitation, disputes relating to this Agreement. Binding arbitration will be conducted in San Diego, California, in accordance with the rules and regulations of the American Arbitration Association. Each party will bear one half of the cost of the arbitration filing and hearing fees, and the cost of the arbitrator. Each party will bear its own attorneys' fees, unless otherwise decided by the arbitrator. (Employee) understands and agrees that the arbitration shall be instead of any civil litigation and that the arbitrator's decision shall be final and binding to the fullest extent permitted by law and enforceable by any court having jurisdiction thereof. 10. If any provision of this Agreement, or part thereof, is held invalid, void or voidable as against the public policy or otherwise, the invalidity shall not affect other provisions, or parts thereof. 11. This Release may be pleaded as a full and complete defense and may be used as the basis for an injunction against any action, suit or proceeding which may be prosecuted, instituted or attempted by either party in breach thereof. 12. This agreement has been presented to COMPS InfoSystems, Inc. and (Employee) for consideration on (Date) by Rebecca Seagle, Manager of Human Resources, for Christopher A. Crane, President and Chief Executive Officer of COMPS InfoSystems, Inc. A-3 13. The parties hereto warrant and represent to each other that it/he has read and understands the meaning of each provision of this Agreement and it/his signature below constitutes it/his acceptance of each term of the Agreement. WE AGREE TO ALL OF THE FOREGOING TERMS. THIS AGREEMENT HAS BEEN EXECUTED ON THE DATE SHOWN BELOW AT SAN DIEGO, CALIFORNIA COMPS InfoSystems, Inc. (COMPS) By: ------------------------------------- -------------------------- Christopher A. Crane Date President and Chief Executive Officer ------------------------------------- -------------------------- (Employee) Date - ---------------------------------------- -------------------------- Rebecca Seagle Date Manager of Human Resources A-4 Schedule to Exhibit 10.17 Executive Title - --------- ----- Emmett DeMoss Chairman of REALBID Division and Vice President of COMPS.COM, INC. Robert Potter President of REALBID Division and Vice President of COMPS.COM, INC. EX-10.18 23 COVENANT NOT TO COMPETE DATED 10/14/94 Exhibit 10.18 COVENANT NOT TO COMPETE ----------------------- This Covenant Not to Compete ("Agreement"), dated as of October 14, 1994, is executed and delivered by ROBERT C. BEASLEY, an individual ("Beasley") to COMPS InfoSystems, Inc., a Delaware corporation (the "Company"), and is made contemporaneously with the repurchase by the Company of certain shares of the Company's stock held by Beasley (the "Repurchased Shares"). RECITALS -------- A. The Company is engaged in the business of providing business information relating to real estate (the "Business"). B. Concurrently with the execution and delivery hereof, the Company is acquiring the Repurchased Shares pursuant to a Repurchase Agreement between the Company and Beasley dated on even date herewith (the "Repurchase Agreement"). C. Beasley acknowledges and agrees that he has technical expertise associated with the Business and is well known in the real estate information industry. In addition, Beasley has valuable business contacts with clients and potential clients of the Business and with professionals in the real estate information industry. Furthermore, Beasley's reputation and goodwill are an integral part of the Company's business success throughout the areas where it conducts the Business. Since Beasley has the ability to compete with the Company in the operation of the Business, the Company therefore desires that Beasley enter into this Agreement. But for Beasley's entry into this Agreement, the Company would not have entered into the Repurchase Agreement with Beasley. Beasley, in exchange for the consideration to be paid under the Repurchase Agreement and the consideration described herein, is willing to enter into this Agreement. AGREEMENT --------- NOW THEREFORE, as a material inducement to the Company to acquire the Repurchased Shares, and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereby agree as follows: 1. Term and Consideration. The term of this Agreement shall commence ---------------------- on the dated hereof (the "Closing Date") and shall expire on the seventh anniversary of the Closing Date (the "Term"). As consideration, Beasley shall be paid $4,336 on a monthly basis beginning with November, 1994 and ending in May, 1996. 2. Covenant Not to Compete. Unless acting in accordance with the ----------------------- Company's prior written consent, Beasley shall not, directly or indirectly, own, manage, join, operate or control, or participate in the ownership, management, operation or control of, or be connected as a director, officer, employee, partner, consultant or otherwise with, or permit his name to be used by or in connection with, any profit or non-profit business or organization that engages in the business of providing real estate information in the States of California or Arizona, it being understood that the foregoing shall not limit Beasley from (a) making passive investments of less than 5% of the outstanding equity securities in any entity listed for trading on a national stock exchange or quoted on any recognized automatic quotation system, or (b) acting as an officer of the Company. 3. No Solicitation of Customers or Employees. Beasley agrees that: ----------------------------------------- (a) during the Term, Beasley shall not, directly or indirectly, call on or solicit or divert or take away from the Company (including without limitation by divulging to any competitor or potential competitor of the Company) any person, firm, corporation or other entity who is or which at the Closing Date was a customer of the Company or whose identity is known to Beasley at the Closing Date as one whom the Company intends to solicit; and (b) during the Term, Beasley shall not, directly or indirectly, solicit or seek to hire or offer employment to any employee of the Company or any employee of any successor or affiliate of the Company which is engaged in the real estate information business, unless the employment of such employee is terminated or the Company gives written consent to such employment or offer of employment. 4. Severability of Provisions. In the event that the provisions of -------------------------- Section 2 and Section 3 ever be adjudicated by a court of competent jurisdiction to exceed the time or geographic or other limitations permitted by applicable law, then such provisions shall be deemed reformed to the maximum time or geographic or other limitations permitted by applicable law, as determined by such court in such action. Without limiting the foregoing, the covenants contained herein shall be construed as separate covenants, covering their respective subject matters, with respect to (a) each of the separate cities, counties and states of the United States, in which the Company or its successors now transacts any business, (b) each business now conducted by any of the Company or its successors, and (c) the Company and its successors separately. 6. Injunctive Relief. Beasley acknowledges that (a) the provisions ----------------- of Section 2 and Section 3 are reasonable and necessary to protect the legitimate interests of the Company, and (b) any violation of Section 2 or Section 3 will result in irreparable injury to the Company, the exact amount of which will be difficult to ascertain, and that the remedies at law for any such violation would not be reasonable or adequate compensation to the Company for such a violation. Accordingly, Beasley agrees that if Beasley violates the provisions of Section 2 or Section 3, in addition to any other remedy which may be available at law or in equity, the Company shall be entitled to specific performance and injunctive relief, without posting bond or other security, and without the necessity of proving actual damages. 7. Notices. All notices, requests, demands and other communications ------- which are required or may be given under this Agreement shall be in writing and shall be deemed to have been duly given if given in the manner and to the address(es) set forth below: If to Beasley: Robert C. Beasley 3411-A Reynard Way San Diego, CA 92103 If to the Company: COMPS InfoSystems, Inc. 9888 Carrol Centre Road San Diego, CA 92126 Attn: President 8. Entire Agreement; Amendments and Waivers. This Agreement and the ---------------------------------------- Repurchase Agreement constitute the entire agreement among the parties pertaining to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and discussions, whether oral or written, of the parties. No amendment, supplement, modification or waiver of this Agreement shall be binding unless executed in writing by the parties. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a continuing waiver unless otherwise expressly provided. The parties expressly acknowledge that they have not relied upon any prior agreements, understandings, negotiations and discussions, whether oral or written. 9. Assignment. Neither this Agreement nor any of the rights or ---------- obligations hereunder may be assigned by any party without the prior written consent of the other parties except that the Company may, without such consent, assign all such rights and obligations to a wholly-owned subsidiary (or a partnership controlled by the Company) or subsidiaries of the Company or to a successor in interest to the Company which shall assume all obligations and liabilities hereunder. 10. Attorneys' Fees and Arbitration. The parties acknowledge and ------------------------------- agree that time is of the essence in resolving any dispute that may arise in connection with this Agreement. Except as set forth herein, any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be settled by binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"). The expenses of the arbitration, including the arbitrators' fees, expert witness fees, and attorneys' fees, may be awarded to the prevailing party, in the discretion of the arbitrator, or may be apportioned among the parties in any manner deemed appropriate by the arbitrator. Unless and until the arbitrator decides that one party is to pay for all (or a share) of such expenses, each party to the dispute shall bear its own fees and costs arising in connection with the enforcement of the Agreement. Not withstanding the foregoing, the Company, in accordance with the provisions of Section 5 of this Agreement, may seek equitable enforcement of the terms of this Agreement in any court of competent jurisdiction. 11. Choice of Law. This Agreement shall be construed, interpreted ------------- and the rights of the parties determined in accordance with the laws of the State of California. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed on their respective behalf, by their respective officers thereunto duly authorized, all as of the day and year first above written. "COMPANY" /s/ Christopher A. Crane - ------------------------- COMPS InfoSystems, Inc. a Delaware corporation By: Christopher A. Crane Its: President "BEASLEY" /s/ Robert C. Beasley - ------------------------ Robert C. Beasley EX-10.19 24 FORM ON NON-COMPETITION DATED 11/6/98 Exhibit 10.19 FORM OF NON-COMPETITION AND NON-DISCLOSURE AGREEMENT This NON-COMPETITION AND NON-DISCLOSURE AGREEMENT (this "Agreement") is made as of November 6, 1998 by and between COMPS INFOSYSTEMS, INC., a Delaware corporation (the "Company"), and __________________ ("Seller"). RECITALS -------- WHEREAS, the Company, Seller, Emmett DeMoss, an individual, and Robert Potter, an individual, have entered into that certain Asset Purchase Agreement of even date herewith (the "Purchase Agreement") pursuant to which the Company is purchasing substantially all of the assets of REALBID (the "Purchased Assets"); WHEREAS, the going concern value of the Purchased Assets and the business being sold by REALBID to the Company would be diminished substantially if Seller were to compete with the Company in such business or in the Company's business within the United States (the "Territory"); WHEREAS, the Purchase Agreement requires that Seller enter into this Agreement as a condition to the obligation of the Company to purchase the Purchased Assets and to consummate the transactions contemplated by the Purchase Agreement. NOW, THEREFORE, in consideration of the mutual covenants set forth in this Agreement, and in connection with the Closing under the Purchase Agreement and the sale of the Purchased Assets in connection therewith, the parties hereto agree as follows (capitalized terms used herein and not otherwise defined herein shall have the meanings given such terms in the Purchase Agreement): 1. Non-Competition. As an inducement for the Company to enter into --------------- the Purchase Agreement and to pay the Purchase Price, Seller hereby covenants as follows: a. In General. Commencing on the date hereof (the "Effective ---------- Date") and for a period equal to the earlier of (i) (x) one year after the date of the termination of Seller's employment with COMPS (1) if Seller's employment with COMPS is terminated for cause, (2) if Seller's employment with COMPS is terminated without cause during the first two years of Seller's employment with COMPS or (3) if Seller voluntarily terminated his employment with COMPS, or (y) if Seller's employment with COMPS is terminated without cause after Seller's first two years of employment with COMPS, the shorter of (1) six months after the date of the termination of Seller's employment with COMPS and (2) the remaining term of Seller's employment under his employment agreement with COMPS; or (ii) four (4) years after the Effective Date (the "Term"), Seller shall not, directly or indirectly, own, manage, engage in, operate or conduct, prepare to or plan to conduct or assists any person or entity to conduct any business, or have any interest in any business, person, firm, corporation or other entity (as a principal, owner, agent, employee, shareholder, officer, director, joint venturer, partner, security holder (except for the ownership of publicly-traded securities constituting not more than five percent (5%) of the outstanding securities of the issuer thereof), creditor (except for trade credit extended in the ordinary course of business), consultant or in any other capacity that engages in any business which is the same as, similar to or competitive with the Company in the commercial real estate information business, which commercial real estate information business shall include without limitation, buyer/seller matching, transaction facilitation, listing services, sales comparables, lease comparables, space availability, tenant information, property inventory, property characteristics, automated valuation models and city and regional market overviews (collectively the "Business"), within the Territory. The covenants set forth in this Section 1(a) shall be construed as a series of ----------- separate covenants covering their subject matter in each of the separate states where the Company conducts the Business, and except for geographic coverage, each such separate covenant shall be deemed identical in terms to the covenant set forth above in this Section 1(a). To the extent that any such covenant shall ------------ be judicially unenforceable in any one or more of such state, such covenant shall not be affected with respect to each of the other states in the Territory. Each covenant with respect to such state in the Territory shall be construed as severable and independent. b. No Diversion of Others. During the Term, Seller shall not, either ---------------------- for itself or for any other person, firm, corporation or other entity, directly or indirectly, or by action in concert with others: (i) induce or influence, or seek to induce or influence, any person who is engaged by the Company (as an agent, employee, consultant, or in any other capacity) or any successor thereto with the purpose of obtaining such person as an employee or customer for a business competitive with the Business; or (ii) divert or take away or attempt to divert or take away, or solicit or attempt to solicit, any existing or potential customer of the Company (whether or not such customer is actually a customer of the Company as of the Effective Date, including without limitation any customer solicited by Seller or which became known by Seller prior to the Effective Date) with the purpose of obtaining such person as an employee or customer for a business competitive with the Business. c. Organizing Competitive Business. Without limiting any of the ------------------------------- other provisions contained in this Section 1, during the Term, Seller shall not --------- plan to compete, prepare to compete or discuss with the Business with any third party, planning or preparing to compete with the Business, or conspire with agents, employees, consultants, other representatives of the Company or any other third party for the purpose of organizing any business activity competitive with the Business. 2. Confidential Information and Non-Disclosure. ------------------------------------------- a. Definition of Confidential Information. Seller hereby -------------------------------------- acknowledges that the Purchased Assets include the confidential and proprietary information regarding Seller in existence prior to the date hereof and other confidential and proprietary information of the Company (collectively, "Confidential Information"), which Confidential Information shall include, without limitation, all of the following materials and information (whether or not reduced to writing and whether or not patentable or protected by copyright): (i) any and all trade secrets concerning the business and affairs of the Business, product specifications, data, procedures, know-how, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions, models, documentation, techniques, diagrams, flowcharts, new products and new technology information, product prototypes, product copies, manufacturing, development or marketing techniques, material, development or marketing timetables, strategies and development plans, and ideas, past, current and planned research and development, current and planned manufacturing and distribution methods and processes, customer lists, current and anticipated customer requirements, price lists, market studies, business plans, computer software and programs (including object code and source code), computer software and database technologies and information (including without limitation confirmed sales transactions, buyer and seller information, listings, space availability and tenant and lease comparables), systems, structures and architectures (and related processes, formulae, compositions, improvements, devices, know-how, inventions, discoveries, concepts, ideas, designs, methods and information) of the Business including but not limited to information related to the customers, suppliers or personnel of the Business, and any other information, however, documented, of the Business that is a trade secret within the meaning of any and all applicable state and federal trade secret laws; (ii) any and all information concerning the business and affairs of the Business (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel and personnel training and techniques and materials), however documented; and (iii) any and all notes, analysis, compilations, studies, summaries, and other material prepared by or for the Business containing or based, in whole or in part, on any information included in the foregoing. The parties hereto agree that the failure of any Confidential Information to be marked or otherwise labeled as confidential or proprietary information shall not affect its status as Confidential Information. Notwithstanding the foregoing, Confidential Information shall not include any information (i) which is generally known to the public or to companies in businesses similar to the Business (except for companies which license such Confidential Information from the Company), (ii) which later, through no act of Seller or any other party to the Purchase Agreement (except the Company), becomes generally known or (iii) which is required to be disclosed by Seller pursuant to a subpoena or court order, or pursuant to a requirement of a governmental agency or law of the United States of America or a state thereof or any governmental or political subdivision thereof, provided that (a) Seller will provide the Company with prior written notice of such disclosure in order that the Company may attempt to obtain a protective order or other assurance of confidential treatment and (b) Seller will cooperate with the Company in attempting to obtain such order or assurance. b. Non-Use and Non-Disclosure. Commencing on the date hereof, Seller -------------------------- shall hold in the strictest confidence (except as previously approved by the Company in writing), and shall not, directly or indirectly, disclose, divulge, reveal, report, publish, transfer or otherwise communicate, or use for its own benefit or the benefit of any other person, partnership, firm, corporation or other entity, or use to the detriment of the Company, or misuse in any way, any Confidential Information. Seller acknowledges that it will in no way infringe upon any COMPS' copyrights and will in no way use, copy, appropriate or redistribute any part of the Confidential Information, whether obtained directly or indirectly from COMPS, without a specific written license agreement with COMPS. It is agreed that derivative, modification or elaboration of any Confidential Information by any third party remains the proprietary property of COMPS for purposes of this Agreement. Seller and the Company each hereby stipulates that, as between them, all Confidential Information acquired by the Company constitutes important, material and confidential and/or proprietary information of the Company and the Business, constitutes unique and valuable information, and affects the successful conduct of the Business and the Company's goodwill, and that the Company shall be entitled to recover its damages, in addition to any injunctive remedy that may be available, for any breach of this Section 2. --------- c. Trade Secrets. All trade secrets of the Business will be entitled ------------- to all of the protection and benefits under all applicable federal and state trade secrets law. If any information that the Company deems to be a trade secret is found by a court of competent jurisdiction not to be a trade secret for purposes of this Agreement, such information will, nevertheless, be considered Confidential Information for purposes of this Agreement. Seller hereby waives any requirement that the Company submit proof of the economic value of any trade secret or post a bond or other security. d. Ownership. Seller hereby acknowledges and agrees that all right, --------- title and interest in and to any Confidential Information shall be the exclusive property of the Company, and that any Confidential Information which the Seller acquired from REALBID was received in confidence and as a fiduciary of REALBID. Without limiting the foregoing, Seller shall assign to the Company any and all right, title or interest which Seller may have in all Confidential Information made, developed or conceived of in whole or in part by Seller during his term as an officer of REALBID. Seller further agrees to execute and deliver any and all instruments, and to do all other things reasonably requested by the Company in order to vest more fully in the Company all ownership rights in such Confidential Information. All equipment, notebooks, documents, memoranda, reports, files, samples, books, correspondence, lists, other written and graphic records, and the like, in any way relating to any Confidential Information or the Business, which Seller prepared, used, constructed, observed, processed, or controlled (collectively, "Materials") shall be the Company's exclusive property, and Seller hereby agrees to deliver all Materials, together with any and all copies thereof, promptly to the Company at the Company's request. 3. Reasonableness of Restrictions. SELLER HAS CAREFULLY READ AND ------------------------------ CONSIDERED THE PROVISIONS OF SECTIONS 1 AND 2 HEREOF AND, HAVING DONE SO, HEREBY ---------- - AGREES THAT THE RESTRICTIONS SET FORTH IN SUCH SECTIONS ARE FAIR AND REASONABLE AND ARE REASONABLY REQUIRED FOR THE PROTECTION OF THE INTERESTS OF THE COMPANY AND THE BUSINESS. 4. Injunctive Relief. ----------------- a. In General. Seller acknowledges and agrees that the Company shall ---------- suffer irreparable harm in the event that Seller breaches any of its obligations under Section 1 or 2 hereof, and that monetary damages shall be inadequate to --------- - compensate the Company for any such breach. Accordingly, Seller agrees that in the event of any breach or threatened breach by Seller of any of the provisions of Section 1 or 2 hereof, the Company shall be entitled to a temporary --------- - restraining order, preliminary injunction and permanent injunction in order to prevent or restrain any such breach or threatened breach by Seller, or by any or all of Seller's agents, representatives or other persons directly or indirectly acting for, on behalf of or with Seller. b. No Limitation of Remedies. Notwithstanding the provisions set ------------------------- forth in Section 4(a), above, or any other provision contained in this Agreement, the parties hereby agree that no remedy conferred by any of the specific provisions of this Agreement, including, without limitation, this Section 4, is intended to be exclusive of any other remedy, and each and every - --------- remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise. 5. MISCELLANEOUS ------------- a. Notices. All notices, requests and other communications hereunder ------- must be in writing and will be deemed to have been duly given only if delivered personally against written receipt or by facsimile transmission with answer back confirmation or mailed (postage prepaid by certified or registered mail, return receipt requested) or by overnight courier to the parties at the following addresses or facsimile numbers: If to Seller, to: REALBID LLC 700 Larkspur Landing Circle, Suite 199 Larkspur, CA 94939 Facsimile No.: (415) 464-4196 Attention: Emmett DeMoss If to the Company, to: COMPS InfoSystems, Inc. 9888 Carroll Centre Road Suite 100 San Diego, CA 92126 Facsimile No.: (619) 684-3292 Attention: Christopher A. Crane All such notices, requests and other communications will (i) if delivered personally to the address as provided in this Section 5(a), be deemed given upon ------------ delivery, (ii) if delivered by facsimile transmission to the facsimile number as provided in this Section 5(a), be deemed given upon receipt, and (iii) if ------------ delivered by mail in the manner described above to the address as provided in this Section 5(a), be deemed given upon receipt (in each case regardless of ------------ whether such notice, request or other communication is received by any other Person to whom a copy of such notice, request or other communication is to be delivered pursuant to this Section). Any party from time to time may change its address, facsimile number or other information for the purpose of notices to that party by giving notice specifying such change to the other parties hereto. b. Entire Agreement. This Agreement, all exhibits attached hereto, ---------------- the Purchase Agreement and the documents executed in connection with the Purchase Agreement supersede all prior discussions and agreements among the parties with respect to the subject matter hereof and contains the sole and entire agreement among the parties hereto with respect thereto. c. Waiver. Any term or condition of this Agreement may be waived at ------ any time by the party that is entitled to the benefit thereof, but no such waiver shall be effective unless set forth in a written instrument duly executed by or on behalf of the party waiving such term or condition. No waiver by any party hereto of any term or condition of this Agreement, in any one or more instances, shall be deemed to be or construed as a waiver of the same or any other term or condition of this Agreement on any future occasion. All remedies, either under this Agreement or by law or otherwise afforded, will be cumulative and not alternative. d. Amendment. This Agreement may be amended, supplemented or --------- modified only by a written instrument duly executed by or on behalf of each party hereto. e. No Third Party Beneficiary. The terms and provisions of this -------------------------- Agreement are intended solely for the benefit of each party hereto and the Company's successors or assigns, and it is not the intention of the parties to confer third-party beneficiary rights upon any other Person. f. No Assignment; Binding Effect. This Agreement shall inure to the ----------------------------- benefit of any successors or assigns of the Company. Seller shall not be entitled to assign its obligations under this Agreement. g. Headings. The headings used in this Agreement have been inserted -------- for convenience of reference only and do not define or limit the provisions hereof. h. Severability. If any provision of this Agreement is held to be ------------ illegal, invalid or unenforceable under any present or future law, and if the rights or obligations of any party hereto under this Agreement will not be materially and adversely affected thereby, (a) such provision will be fully severable, (b) this Agreement will be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof, (c) the remaining provisions of this Agreement will remain in full force and effect and will not be affected by the illegal, invalid or unenforceable provision or by its severance herefrom and (d) in lieu of such illegal, invalid or unenforceable provision, there will be added automatically as a part of this Agreement a legal, valid and enforceable provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and mutually acceptable to the parties herein. i. Governing Law. This Agreement shall be governed by and construed ------------- in accordance with the laws of the State of California applicable to contracts executed and performed in such State, without giving effect to conflicts of laws principles. j. Attorneys Fees. In the event suit or action is brought by any -------------- party under this Agreement to enforce or construe any of its terms, the prevailing party shall be entitled to recover, in addition to all other amounts and relief, its reasonable costs and attorneys fees incurred at and in preparation for arbitration, trial, appeal and review, such sum to be set by the arbitrator or court before which the matter is heard. k. Counterparts. This Agreement may be executed in any number of ------------ counterparts and by facsimile, each of which will be deemed an original, but all of which together will constitute one and the same instrument. [SIGNATURE PAGE TO FOLLOW] IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date first above written. COMPS INFOSYSTEMS, INC., a Delaware corporation By: --------------------------------------- Name: ------------------------------------- Title: ------------------------------------ SELLER By: ---------------------------------------- [SIGNATURE PAGE TO THE REALBID NON-COMPETITION AND NON-DISCLOSURE AGREEMENT] Schedule 1 to Exhibit 10.19 --------------------------- Parties - ------- REALBID LLC, a California limited liability company Emmett DeMoss, an individual Robert Potter, an individual EX-10.20 25 FORM OF NON-COMPETITION DATED 1/7/99 Exhibit 10.20 FORM OF NON-COMPETITION AND NON-DISCLOSURE AGREEMENT This NON-COMPETITION AND NON-DISCLOSURE AGREEMENT (this "Agreement") is made as of _________, 199_ by and between COMPS INFOSYSTEMS, INC., a Delaware corporation (the "Company"), and __________________ ("Principal"). RECITALS -------- WHEREAS, the Company, [AOBR, Inc., a Texas corporation ("AOBR")], [Linda Hoffman, an individual ("Hoffman"),] [Guy Goodwin, an individual,] and [Don Guy, an individual,] have entered into that certain Asset Purchase Agreement, dated as of December __, 1998 (the "Purchase Agreement") pursuant to which the Company is purchasing all of the assets related to Hoffman Valuation Data Services (the "Purchased Assets"); WHEREAS, the going concern value of the Purchased Assets and the business being sold by AOBR and Hoffman to the Company would be diminished substantially if the Principal were to compete with the Company in such business or in the Company's business within the United States (the "Territory"); WHEREAS, the Purchase Agreement requires that Principal enter into this Agreement as a condition to the obligation of the Company to purchase the Purchased Assets and to consummate the transactions contemplated by the Purchase Agreement. NOW, THEREFORE, in consideration of the mutual covenants set forth in this Agreement, and in connection with the Closing under the Purchase Agreement and the sale of the Purchased Assets in connection therewith, the parties hereto agree as follows (capitalized terms used herein and not otherwise defined herein shall have the meanings given such terms in the Purchase Agreement): 1. Non-Competition. As an inducement for the Company to enter into --------------- the Purchase Agreement and to pay the Purchase Price, Principal hereby covenants as follows: a. In General. Commencing on the date hereof (the "Effective Date") ---------- and for a period of two (2) years after the Effective Date (the "Term"), Principal shall not, directly or indirectly, own, manage, engage in, operate or conduct, prepare to or plan to conduct or assist any person or entity to conduct any business, or have any interest in any business, person, firm, corporation or other entity (as a principal, owner, agent, employee, shareholder, officer, director, joint venturer, partner, security holder (except for the ownership of publicly-traded securities constituting not more than five percent (5%) of the outstanding securities of the issuer thereof), creditor (except for trade credit extended in the ordinary course of business), consultant or in any other capacity) that engages, directly or indirectly, in any business which is the same as, similar to or competitive with the Company in the Business, which Business shall include without limitation, the collection and distribution of sales comparable information or publication of materials similar to the Report (whether in electronic form or hard copy form), within the Territory. Notwithstanding the foregoing, the Business will not include sales comparable information required to produce the Austin Office Building Report which information will be licensed to AOBR for the sole purpose of preparing the Austin Office Building Report. The covenants set forth in this Section 1(a) shall be construed as a series of separate covenants covering their subject matter in each of the separate states where the Company conducts the Business, and except for geographic coverage, each such separate covenant shall be deemed identical in terms to the covenant set forth above in this Section 1(a). To the ------------- extent that any such covenant shall be judicially unenforceable in any one or more of such state, such covenant shall not be affected with respect to each of the other states in the Territory. Each covenant with respect to such state in the Territory shall be construed as severable and independent. b. No Diversion of Others. During the Term, Principal shall not, ---------------------- either for itself or for any other person, firm, corporation or other entity, directly or indirectly, or by action in concert with others: (i) induce or influence, or seek to induce or influence, any person who is engaged by the Company (as an agent, employee, consultant, or in any other capacity) or any successor thereto with the purpose of obtaining such person as an employee or customer for a business competitive with the Business; or (ii) divert or take away or attempt to divert or take away, or solicit or attempt to solicit, any existing or potential customer of the Company (whether or not such customer is actually a customer of the Company as of the Effective Date, including without limitation any customer solicited by Principal or which became known by Principal prior to the Effective Date) with the purpose of obtaining such person as an employee or customer for a business competitive with the Business. c. Organizing Competitive Business. Without limiting any of the ------------------------------- other provisions contained in this Section 1, during the Term, Principal shall --------- not plan to compete, prepare to compete or discuss the Business with any third party, planning or preparing to compete with the Business, or conspire with agents, employees, consultants, other representatives of the Company or any other third party for the purpose of organizing any business activity competitive with the Business. 2. Confidential Information and Non-Disclosure. ------------------------------------------- a. Definition of Confidential Information. Principal hereby -------------------------------------- acknowledges that the Purchased Assets include the confidential and proprietary information regarding Principal in existence prior to the date hereof and other confidential and proprietary information of the Company (collectively, "Confidential Information"), which Confidential Information shall include, without limitation, all of the following materials and information (whether or not reduced to writing and whether or not patentable or protected by copyright): (i) any and all trade secrets concerning the business and affairs of the Business, product specifications, data, know-how, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, customer lists, current and anticipated customer requirements, price lists, market studies, business plans of the Business and any other information, however, documented, of the Business that is a trade secret within the E-3 meaning of any and all applicable state and federal trade secret laws; (ii) any and all information concerning the business and affairs of the Business (which includes historical financial statements, financial projections and budgets and historical and projected sales), however documented; and (iii) any and all notes, analysis, compilations, studies, summaries, and other material prepared by or for the Business containing or based, in whole or in part, on any information included in the foregoing. The parties hereto agree that the failure of any Confidential Information to be marked or otherwise labeled as confidential or proprietary information shall not affect its status as Confidential Information. Notwithstanding the foregoing, Confidential Information shall not include any information which is generally known to the public or to companies in businesses similar to the Business, or which later, through no act of Principal or any other party to the Purchase Agreement (except the Company), becomes generally known. b. Non-Use and Non-Disclosure. Commencing on the date hereof, -------------------------- Principal shall hold in the strictest confidence (except as previously approved by the Company in writing), and shall not, directly or indirectly, disclose, divulge, reveal, report, publish, transfer or otherwise communicate, or use for its own benefit or the benefit of any other person, partnership, firm, corporation or other entity, or use to the detriment of the Company, or misuse in any way, any Confidential Information. Principal and the Company each hereby stipulates that, as between them, all Confidential Information acquired by the Company constitutes important, material and confidential and/or proprietary information of the Company and the Business, constitutes unique and valuable information, and affects the successful conduct of the Business and the Company's goodwill, and that the Company shall be entitled to recover its damages, in addition to any injunctive remedy that may be available, for any breach of this Section 2. --------- c. Trade Secrets. All trade secrets of the Business will be entitled ------------- to all of the protection and benefits under all applicable federal and state trade secrets law. If any information that the Company deems to be a trade secret is found by a court of competent jurisdiction not to be a trade secret for purposes of this Agreement, such information will, nevertheless, be considered Confidential Information for purposes of this Agreement. Principal hereby waives any requirement that the Company submit proof of the economic value of any trade secret or post a bond or other security. d. Ownership. Principal hereby acknowledges and agrees that all --------- right, title and interest in and to any Confidential Information shall be the exclusive property of the Company, and that any Confidential Information which the Principal acquired from AOBR or Hoffman was received in confidence and as a fiduciary of AOBR. Without limiting the foregoing, Principal shall assign to the Company any and all right, title or interest which Principal may have in all Confidential Information made, developed or conceived of in whole or in part by Principal during his/her term as company principal or affiliate of AOBR. Principal further agrees to execute and deliver any and all instruments, and to do all other things reasonably requested by the Company in order to vest more fully in the Company all ownership rights in such Confidential Information. All notebooks, documents, memoranda, reports, files, samples, books, correspondence, lists, other written and graphic records, and the like, in any way relating to any Confidential Information or the Business, which Principal prepared, used, constructed, observed, processed, or controlled (collectively, "Materials") shall be the Company's E-4 exclusive property, and Principal hereby agrees to deliver all Materials, together with any and all copies thereof, promptly to the Company at the Company's request. 3. Reasonableness of Restrictions. PRINCIPAL HAS CAREFULLY READ AND ------------------------------ CONSIDERED THE PROVISIONS OF SECTIONS 1 AND 2 HEREOF AND, HAVING DONE SO, HEREBY AGREES THAT THE RESTRICTIONS SET FORTH IN SUCH SECTIONS ARE FAIR AND REASONABLE AND ARE REASONABLY REQUIRED FOR THE PROTECTION OF THE INTERESTS OF THE COMPANY AND THE BUSINESS. 4. Injunctive Relief. ----------------- a. In General. Principal acknowledges and agrees that the ---------- Company shall suffer irreparable harm in the event that Principal breaches any of its obligations under Section 1 or 2 hereof, and that monetary damages shall be inadequate to compensate the Company for any such breach. Notwithstanding the arbitration provision of the Purchase Agreement, Principal agrees that in the event of any breach or threatened breach by Principal of any of the provisions of Section 1 or 2 hereof, the Company shall be entitled to a temporary restraining order, preliminary injunction and permanent injunction in order to prevent or restrain any such breach or threatened breach by Principal, or by any or all of Principal's agents, representatives or other persons directly or indirectly acting for, on behalf of or with Principal. b. No Limitation of Remedies. Notwithstanding the provisions set ------------------------- forth in Section 4(a), above, or any other provision contained in this Agreement, the parties hereby agree that no remedy conferred by any of the specific provisions of this Agreement, including, without limitation, this Section 4, is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise. 5. MISCELLANEOUS ------------- a. Notices. All notices, requests and other communications ------- hereunder must be in writing and will be deemed to have been duly given only if delivered personally against written receipt or by facsimile transmission with answer back confirmation or mailed (postage prepaid by certified or registered mail, return receipt requested) or by overnight courier to the parties at the following addresses or facsimile numbers: If to Principal, to: AOBR, Inc. 8303 North Mopac, Suite B-325 Austin, TX 78759 Facsimile No: (512) 346-4873 Attention: Linda Hoffman and Guy Goodwin E-5 If to the Company, to: COMPS InfoSystems, Inc. 9888 Carroll Centre Road, Suite 100 San Diego, CA 92126 Facsimile No.: (619) 684-3292 Attention: Christopher Crane All such notices, requests and other communications will (i) if delivered personally to the address as provided in this Section 5(a), be deemed given upon delivery, (ii) if delivered by facsimile transmission to the facsimile number as provided in this Section 5(a), be deemed given upon receipt, and (iii) if delivered by mail in the manner described above to the address as provided in this Section 5(a), be deemed given upon receipt (in each case regardless of whether such notice, request or other communication is received by any other Person to whom a copy of such notice, request or other communication is to be delivered pursuant to this Section). Any party from time to time may change its address, facsimile number or other information for the purpose of notices to that party by giving notice specifying such change to the other parties hereto. b. Entire Agreement. This Agreement (and all exhibits attached ---------------- hereto) the Purchase Agreement (and all exhibits and schedules attached thereto) and all other documents delivered in connection herewith supersede all prior discussions and agreements among the parties with respect to the subject matter hereof and thereof and contains the sole and entire agreement among the parties hereto with respect thereto. c. Waiver. Any term or condition of this Agreement may be waived at ------ any time by the party that is entitled to the benefit thereof, but no such waiver shall be effective unless set forth in a written instrument duly executed by or on behalf of the party waiving such term or condition. No waiver by any party hereto of any term or condition of this Agreement, in any one or more instances, shall be deemed to be or construed as a waiver of the same or any other term or condition of this Agreement on any future occasion. All remedies, either under this Agreement or by law or otherwise afforded, will be cumulative and not alternative. d. Amendment. This Agreement may be amended, supplemented or --------- modified only by a written instrument duly executed by or on behalf of each party hereto. e. No Third Party Beneficiary. The terms and provisions of this -------------------------- Agreement are intended solely for the benefit of each party hereto and the Company's successors or assigns, and it is not the intention of the parties to confer third-party beneficiary rights upon any other Person. f. No Assignment; Binding Effect. This Agreement shall inure to the ----------------------------- benefit of any successors or assigns of the Company. Principal shall not be entitled to assign its obligations under this Agreement. g. Headings. The headings used in this Agreement have been inserted -------- for convenience of reference only and do not define or limit the provisions hereof. E-6 h. Severability. If any provision of this Agreement is held to be ------------ illegal, invalid or unenforceable under any present or future law, and if the rights or obligations of any party hereto under this Agreement will not be materially and adversely affected thereby, (a) such provision will be fully severable, (b) this Agreement will be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof, (c) the remaining provisions of this Agreement will remain in full force and effect and will not be affected by the illegal, invalid or unenforceable provision or by its severance herefrom and (d) in lieu of such illegal, invalid or unenforceable provision, there will be added automatically as a part of this Agreement a legal, valid and enforceable provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and mutually acceptable to the parties herein. i. Governing Law. This Agreement shall be governed by and construed ------------- in accordance with the laws of the State of California applicable to contracts executed and performed in such State, without giving effect to conflicts of laws principles. j. Attorneys Fees. In the event suit or action is brought by any -------------- party under this Agreement to enforce or construe any of its terms, the prevailing party shall be entitled to recover, in addition to all other amounts and relief, its reasonable costs and attorneys fees incurred at and in preparation for arbitration, trial, appeal and review, such sum to be set by the arbitrator or court before which the matter is heard. k. Construction. No provision of this Agreement shall be construed ------------ in favor of or against any party on the ground that such party or its counsel drafted the provision. Any remedies provided for herein are not exclusive of any other lawful remedies which may be available to either party. This Agreement shall at all times be construed so as to carry out the purposes stated herein. l. Counterparts. This Agreement may be executed in any number of ------------ counterparts and by facsimile, each of which will be deemed an original, but all of which together will constitute one and the same instrument. [SIGNATURE PAGE TO FOLLOW] E-7 IN WITNESS WHEREOF, each of the parties hereto has duly executed this Agreement as of the date first above written. COMPS INFOSYSTEMS, INC., a Delaware corporation By: ------------------------ Name: ------------------------ Title: ------------------------ ------------------------------ [Principal] [SIGNATURE PAGE TO THE FORM OF NON-COMPETITION AND NON-DISCLOSURE AGREEMENT] E-8 Schedule 1 to Exhibit 10.20 --------------------------- Principals - ---------- AOBR, Inc., a Texas corporation Linda Hoffman, an individual Guy Goodwin, an individual Don Guy, an individual E-9 EX-10.21 26 FORM OF EMPLOYEE CONFIDENTIALITY & INVENTIONS Exhibit 10.21 FORM OF EMPLOYEE CONFIDENTIALITY AND INVENTIONS AGREEMENT (Date) (Name/address) The following confirms an agreement between me and COMPS InfoSystems, Inc., a Delaware corporation (the "Company"), which is a material part of the ------- consideration for my employment by the Company: 1. (a) I understand that the Company possesses and will possess Proprietary Information which is important to its business. For purposes of this Agreement, "Proprietary Information" is information that was or will be developed, created, or discovered by or on behalf of the Company, or which became or will become known by, or was or is conveyed to the Company, which has commercial value in the Company's business. "Proprietary Information" includes, ----------- ----------- but is not limited to, information about real estate sales comparables, real estate listings, real estate leases, real estate inventory, real estate space availability, tenants, algorithms, trade secrets, licenses, computer programs, designs, technology, ideas, know-how, processes, formulas, compositions, data, techniques, improvements, inventions (whether patentable or not), works of authorship, business and product development plans, skills or salaries or terms of compensation of other employees, information about customers, budgets, prices, costs, and other information concerning the Company's actual or anticipated business, research or development, or which is received in confidence by or for the Company from any other person. I understand that my employment creates a relationship of confidence and trust between me and the Company with respect to Proprietary Information. I have been informed and acknowledge that the unauthorized taking of the Company's Proprietary Information (i) could result in a civil liability under California Civil Code Section 3426, and that, if willful, could result in an award for double the amount of the Company's damages and attorneys' fees; and (ii) is a crime under California Penal Code Section 499(c), punishable by imprisonment for a time not exceeding one (1) year, or by a fine not exceeding five thousand dollars ($5,000), or by both. (b) I acknowledge and agree that COMPS' software and databases including, but not limited to, real estate sales transactions, listings, lease comparables, inventories, tenants, and space availability are proprietary to COMPS and the sole property of COMPS. I acknowledge that COMPS' information and software is copyrighted and that I will in no way win infringe upon such copyrights. I will in no way use, copy, appropriate, or redistribute this information, whether obtained directly or indirectly from COMPS, without a specific written license agreement with COMPS. I agree that any derivative, modification or elaboration of COMPS' software or databases by a third party is still the proprietary property of COMPS for purposes of this Agreement. 2. I understand that the Company possesses or will possess "Company Materials" which are important to its business. For purposes of this Agreement, "Company Materials" are documents or other media or tangible items that contain - ------------------ or embody Proprietary -1- ________ Initials Information or any other information concerning the business, operations or plans of the Company, whether such documents have been prepared by me or by others. "Company Materials" include, but are not limited to, blueprints, drawings, photographs, charts, graphs, software, functional and technical specifications, software concepts, methodologies, notebooks, customer lists, computer disks, tapes or printouts, sound recordings and other printed, typewritten or handwritten documents, as well as samples, prototypes, models, products and the like. 3. In consideration of my employment by the Company and the compensation received by me from the Company from time to time, I hereby agree as follows: a. All Proprietary Information and all title, patents, patent rights, copyrights, mask work rights, trade secret rights, and other intellectual property and rights (collectively "Rights") in connection therewith will be the ------ sole property of the Company. I hereby assign to the Company any Rights I may have or acquire in such Proprietary Information. At all times, both during my employment by the Company and after its termination, I will keep in confidence and trust and will not use or disclose any Proprietary Information or anything relating to it without the prior written consent of the President or Chairman of the Company except as may be necessary and appropriate in the ordinary course of performing my duties to the Company. Nothing contained herein will prohibit an employee from disclosing to anyone the amount of his or her wages. b. All Company Materials will be the sole property of the Company. I further agree that any property situated on the Company's premises and owned by the Company, including disks and other storage media, filing cabinets or other work areas, are subject to inspection by Company personnel at any time with or without notice. I agree that during my employment by the Company, I will not remove any Company Materials from the business premises of the Company or deliver any Company Materials to any person or entity outside the Company, except as I am required to do in connection with performing the duties of my employment. I further agree that, immediately upon the termination of my employment by me or by the Company for any reason, or during my employment if so requested by the Company, I will return all Company Materials, apparatus, equipment and other physical property, or any reproduction of such property, excepting only (i) my personal copies of records relating to my compensation; (ii) my personal copies of any materials previously distributed generally to stockholders of the Company; and (iii) my copy of this Agreement. c. I will promptly disclose in writing to my immediate supervisor, with a copy to the President of the Company, or to any persons designated by the Company, all "Inventions," which includes all improvements, inventions, designs, ---------- formulas, works of authorship, trade secrets, technology, computer programs, layouts, algorithms, computer programs, formulas, compositions, ideas, designs, processes, techniques, know-how and data, whether or not patentable, made or conceived or reduced to practice or developed by me, either alone or jointly with others, during the term of my employment. I will also disclose to the -2- ________ Initials President of the Company all things that would be Inventions if made during the term of my employment, conceived, reduced to practice, or developed by me within six months after the termination of my employment with the Company. Such disclosures will be received by the Company in confidence (to the extent they are not assigned in Section (d) below) and do not extend the assignment made in ----------- Section 3(d) below. I will not disclose Inventions to any person outside the - ------------ Company unless I am requested to do so by management personnel of the Company. d. I agree that all Inventions which I make, conceive, reduce to practice or develop (in whole or in part, either alone or jointly with others) during my employment will be the sole property of the Company to the maximum extent permitted by Section 2870 of the California Labor Code, a copy of which is attached, and I hereby assign such Inventions and all Rights therein to the Company. No assignment in this Agreement will extend to inventions, the assignment of which is prohibited by Labor Code Section 2870 (attached Attachment A). At the time of each such disclosure, I will advise the Company - ------------ in writing of any inventions that I believe fully qualify for protection under Section 2870; and I will at that time provide to the Company in writing all evidence necessary to substantiate that belief I understand that the Company will keep in confidence and will not disclose to third parties without my consent any proprietary information disclosed in writing to the Company pursuant to this Agreement relating to inventions that qualify fully for protection under the provisions of Section 2870. 1 will preserve the confidentiality of any invention that does not qualify fully for protection under Section 2870. 1 agree to keep and maintain adequate and current records (in the form of notes, sketches, drawings and in any other form that may be required by the Company) of all Proprietary Information developed by me and all Inventions made by me during the period of my employment at the Company, which records shall be available to and remain the sole property of the Company at all times. I hereby waive and quitclaim to the Company any and all claims of any nature whatsoever which I now or may hereafter have for infringement of any proprietary rights assigned to the Company. e. I agree to perform, during and after my employment, all acts deemed necessary or desirable by the Company to permit and assist it, at the Company's expense, in obtaining, maintaining, defending and enforcing Rights with respect to such Inventions and improvements in any and all countries. Such acts may include, but are not limited to, execution of documents and assistance or cooperation in legal proceedings, including appearing as a party or witness. I hereby irrevocably designate and appoint the Company and its duly authorized officers and agents, as my agents and attorneys-in-fact to act for and in my behalf and instead of me, to execute and file any documents and to do all other lawfully permitted acts to further the above purposes with the same legal force and effect as if executed by me. My obligation to assist the Company with respect to proprietary fights in any and all countries shall continue beyond the termination of my employment, but the Company shall compensate me at a reasonable rate after my termination for the time actually spent by me at the Company's request on such assistance. -3- ________ Initials f. Any assignment of copyright pursuant to this Agreement includes all rights of paternity, integrity, disclosure and withdrawal and any other rights that may be known as or referred to as "moral rights" (collectively "Moral Rights"). To the extent such Moral Rights cannot be assigned under ------------ applicable law and to the extent the following is allowed by the laws in the various countries where Moral Rights exist, I hereby waive such Moral Rights and consent to any action of the Company that would violate such Moral Rights in the absence of such consent. I will confirm any such waivers and consents from time to time as requested by the Company. g. I have attached as Attachment B to this Agreement a complete ------------ list of all existing Inventions or improvements to which I claim ownership as of the date of this Agreement and that I desire to specifically clarify are not subject to this Agreement, and I acknowledge and agree that such list is complete. If disclosure of an item on Attachment B would cause me to violate any ------------ prior confidentiality agreement, I understand that I am not to list such in Attachment B but am to inform the Company that all items have not been - ------------ listed for that reason. A space is provided on Attachment B for such purpose. If ------------ no such list is attached to this Agreement, I represent that I have no such Inventions and improvements at the time of signing this Agreement. ___________[INITIAL HERE] h. During the term of my employment and for one year thereafter, I will not encourage or solicit any employee or consultant of the Company to leave the Company for any reason. However, this obligation will not affect any responsibility I may have as an employee of the Company with respect to the bona fide hiring and firing of Company personnel. i. I agree that during my employment with the Company I will not engage in any employment, business, or activity that is in any way competitive with the business or proposed business of the Company, and I will not prepare to compete, nor will I assist any other person or organization in competing with the Company or in preparing to engage in competition with the business or proposed business of the Company. The provisions of this paragraph will apply both during normal working hours and at all other times including, but not limited to, nights, weekends and vacation time, while I am employed by the Company. j. I represent that my performance of all the terms of this Agreement will not breach any agreement to keep in confidence proprietary information acquired by me in confidence or in trust prior to my employment by the Company. I have not entered into, and I agree I will not enter into, any agreement either written or oral in conflict herewith or in conflict with my employment with the Company. I agree that I will not, during my employment with the Company, improperly use or disclose any proprietary information or trade secrets of my former or concurrent employers, if any, and that I will not bring onto the premises of the Company any unpublished documents or any property belonging to my former or concurrent employers unless consented to in writing by such employers. -4- ________ Initials k. I recognize that the Company has received and in the future will receive from third parties their confidential or proprietary information subject to a duty on the Company's part to maintain the confidentiality of such information and, in some cases, to use it only for certain limited purposes. I agree that I owe the Company and such third parties, both during the term of my employment and thereafter, a duty to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation (except in a manner that is consistent with the Company's agreement with the third party) or use it for the benefit of anyone other than the Company or such third party (consistent with the Company's agreement with the third party). 4. I agree that this Agreement is not an employment contract and that I have the right to resign and the Company has the right to terminate my employment at any time, for any reason, with or without cause. 5. I agree that this Agreement does not purport to set forth all of the terms and conditions of my employment, and that as an employee of the Company I have obligations to the Company which are not set forth in this Agreement. 6. I agree that (a) my obligations under Sections 1(a) through Sections 1(b) and ------------- ------------- Sections 3(a) through 3(f) and Sections 3(h) and 3(k) of this Agreement will - ------------- ---- ------------- ---- continue in effect after termination of my employment, regardless of the reason or reasons for termination, and whether such termination is voluntary or involuntary on my part, and that I will notify any future client, employer or potential employer or client of my obligations under this Agreement; (b) the Company is entitled to communicate my obligations under this Agreement to any future employer or potential employer of mine; (c) upon termination of my employment for any reason I will execute, a bide by and deliver to the Company a termination certificate substantially in the form attached to this Agreement as Attachment C; and ------------ (d) the Company has expended substantial efforts to maintain the confidentiality of the Proprietary Information and would be materially and irreparably injured by an unauthorized disclosure of any of that information during my employment with the Company or thereafter, and that any breach of this Agreement will result in irreparable and continuing damage to the Company for which there can be no adequate remedy at law, and in the event of any such breach, the Company will be entitled to immediate injunctive relief and other equitable remedies (without any need to post any bond or other security) in addition to such other and further relief as may be proper. 7. I agree that any dispute in the meaning, effect or validity of this Agreement will be resolved in accordance with the laws of the State of California without regard -5- ________ Initials to the conflict of laws provisions thereof to this Agreement. I further agree that if one or more provisions of this Agreement are held to be illegal or unenforceable under applicable California law, such illegal or unenforceable portion(s) will be limited or excluded from this Agreement to the minimum extent required so that this Agreement will otherwise remain in full force and effect and enforceable in accordance with its terms. Venue for any action relating to this Agreement shall be in San Diego County, California. 8. This Agreement will be effective as of the date I execute this Agreement and will be binding upon me, my heirs, executors, assigns, and administrators and will inure to the benefit of the Company, its subsidiaries, successors and assigns. 9. This Agreement constitutes the entire agreement pertaining to the subject matter hereof and supersedes all prior and contemporaneous oral, written or implied agreements, representations, and understanding of the subject matter hereof. This Agreement can only be modified by a subsequent written agreement executed by the President or Chairman of the Company. 10. This Agreement is supplementary to, and shall not be considered a waiver of, any rights of the Company that may exist independently of this Agreement. -6- ________ Initials I HAVE READ THIS AGREEMENT CAREFULLY AND I UNDERSTAND AND ACCEPT THE OBLIGATIONS WHICH IT IMPOSES UPON ME WITHOUT RESERVATION. NO PROMISES OR REPRESENTATIONS HAVE BEEN MADE TO ME TO INDUCE ME TO SIGN THIS AGREEMENT. I SIGN THIS AGREEMENT VOLUNTARILY AND FREELY, IN DUPLICATE, WITH THE UNDERSTANDING THAT ONE ORIGINAL COUNTERPART WILL BE RETAINED BY THE COMPANY AND THE OTHER ORIGINAL COUNTERPART WILL BE RETAINED BY ME. Dated:__________, 19____ _____________________________________________ (Name) Accepted and Agreed to: By____________________________ -7- ________ Initials ATTACHMENT A ------------ TO EMPLOYEE CONFIDENTIALITY AND INVENTIONS AGREEMENT ---------------------------------------------------- Section 2870. Application of provision providing that employee will assign or offer to assign rights in invention to employer. (a) Any provision in an employment agreement which provides that an employee will assign, or offer to assign, any of his or her rights in an invention to his or her employer will not apply to an invention that the employee developed entirely on his or her own time without using the employer's equipment, supplies, facilities, or trade secret information except for these inventions that either: (1) Relate at the time of conception or reduction to practice of the invention to the employer's business, or actual or demonstrably anticipated research or development of the employer, or (2) Result from any work performed by the employee for the employer. (b) To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of this state and is unenforceable. -8- ________ Initials ATTACHMENT B ------------ TO EMPLOYEE CONFIDENTIALITY AND INVENTIONS AGREEMENT ---------------------------------------------------- (Name/address) 1. The following is a [complete] list of inventions or improvements relevant to the subject matter of my employment by COMPS InfoSystems, Inc. (the "Company") that have been made or conceived or first reduced to practice by me alone or jointly with others prior to my employment by the Company that I desire to clarify are not subject to the Company's Confidentiality and Inventions Agreement. No inventions or improvements See below: Due to confidentiality agreements with a prior employer, I cannot disclose certain inventions that would otherwise be included on the above list. Additional sheets attached 2. I propose to bring to my employment the following materials and documents of a former employer, which employer has expressly consulted to my continued possession and use. No materials or documents See below: ________________________________ -9- ________ Initials ATTACHMENT C ------------ TO EMPLOYEE CONFIDENTIALITY AND INVENTIONS AGREEMENT ---------------------------------------------------- I hereby certify that I do not have in my possession, nor have I failed to return, any devices, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, blue/redlines, sketches, materials equipment, other documents or property, or reproductions of any aforementioned items belonging to COMPS InfoSystems, Inc., its subsidiaries, affiliates, successors or assigns (together, the "Company"). I further certify that I have complied with all the terms of the Company's Employee Confidentiality and Inventions Agreement signed by me, including the reporting of any Inventions (as defined therein) and original works of authorship, conceived or made by me (solely or jointly with others) covered by that agreement, I further agree that, in compliance with the Employee Confidentiality and Inventions Agreement, I will continue to preserve as confidential all Proprietary Information (as defined therein). - ---------------------------------- ------------------------------------------ Employee's Signature Date - ---------------------------------- Employee's Name Printed -10- ________ Initials EX-10.22 27 FORM OF INDEMNIFICATION AGMT W/DIRECTORS Exhibit 10.22 FORM OF INDEMNIFICATION AGREEMENT THIS AGREEMENT is made and entered into this ____ day of ___________, 1999 between COMPS.COM, INC., a Delaware corporation ("Corporation"), whose address is 9888 Carroll Centre Drive, Suite 100, San Diego, California 92126 and __________________ ("Director"), whose address is __________________________________. RECITALS: -------- A. WHEREAS, Director, a member of the Board of Directors of Corporation (the "Board"), performs a valuable service in such capacity for Corporation; and B. WHEREAS, the stockholders of Corporation have adopted Bylaws (the "Bylaws") providing for the indemnification of the officers, directors, agents and employees of Corporation to the maximum extent authorized by Section 145 of the Delaware General Corporation Law, as amended (the "Law"); and C. WHEREAS, the Bylaws and the Law, as amended and in effect from time to time or any successor or other statutes of Delaware having similar import and effect, currently purport to be the controlling law governing Corporation with respect to certain aspects of corporate law, including indemnification of directors and officers; and D. WHEREAS, in accordance with the authorization provided by the Law, Corporation may from time to time purchase and maintain a policy or policies of Directors and Officers Liability Insurance ("D & O Insurance"), covering certain liabilities which may be incurred by its directors and officers in the performance of services as directors and officers of Corporation; and E. WHEREAS, as a result of developments affecting the terms, scope and availability of D & O Insurance there exists general uncertainty as to the extent and overall desirability of protection afforded members of the Board of Directors by such D & O Insurance, if any, and by statutory and bylaw indemnification provisions; and F. WHEREAS, in order to induce Director to continue to serve as a member of the Board, Corporation has determined and agreed to enter into this contract with Director. NOW, THEREFORE, in consideration of Director's continued service as a director after the date hereof, the parties hereto agree as follows: 1. Certain Definitions. The following terms used in this Agreement shall ------------------- have the meanings set forth below. Other terms are defined where appropriate in this Agreement. (a) "Disinterested Director" shall mean a director of Corporation who ---------------------- is not or was not a party to the Proceeding in respect of which indemnification is being sought by Director. (b) "Expenses" shall include all direct and indirect costs (including, -------- without limitation, attorneys' fees, retainers, court costs, transcripts, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, all other disbursements or out-of-pocket expenses and reasonable compensation for time spent by Director for which he or she is otherwise not compensated by Corporation) actually and reasonably incurred in connection with a Proceeding or establishing or enforcing a right to indemnification under this Agreement, applicable law or otherwise; provided, however, that "Expenses" shall not include any Liabilities. (c) "Final Adverse Determination" shall mean that a determination that --------------------------- Director is not entitled to indemnification shall have been made pursuant to Section 5 hereof and either (i) a final adjudication in a Delaware court or decision of an arbitrator pursuant to Section 13(a) hereof shall have denied Director's right to indemnification hereunder, or (ii) Director shall have failed to file a complaint in a Delaware court or seek an arbitrator's award pursuant to Section 13(a) for a period of one hundred twenty (120) days after the determination made pursuant to Section 5 hereof. (d) "Independent Legal Counsel" shall mean a law firm or member of a ------------------------- law firm selected by Corporation and approved by Director (which approval shall not be unreasonably withheld) and that neither is presently nor in the past five years has been retained to represent: (i) Corporation, in any material matter, or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term "Independent Legal Counsel" shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either Corporation or Director in a Proceeding to determine Director's right to indemnification under this Agreement. (e) "Liabilities" shall mean liabilities of any type whatsoever ----------- including, but not limited to, any judgments, fines, ERISA excise taxes and penalties, and penalties and amounts paid in settlement (including all interest assessments and other charges paid or payable in connection with or in respect of such judgments, fines, penalties or amounts paid in settlement) of any proceeding. (f) "Proceeding" shall mean any threatened, pending or completed ---------- action, claim, suit, arbitration, alternative dispute resolution mechanism, investigation, administrative hearing or any other proceeding whether civil, criminal, administrative or investigative, including any appeal therefrom. (g) "Change of Control" shall mean the occurrence of any of the ----------------- following events after the date of this Agreement: (i) A change in the composition of the Board, as a result of which fewer than two-thirds (2/3) of the incumbent directors are directors who either (1) had been directors of Corporation twenty-four (24) months prior to such change or (2) were elected, or nominated for election, to the Board with the affirmative votes of at least a majority of the directors who had been directors of Corporation 24 months prior to such change and who were still in office at the time of the election or nomination; or 2 (ii) Any "person" (as such term is used in section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) through the acquisition or aggregation of securities is or becomes the beneficial owner, directly or indirectly, of securities of Corporation representing twenty percent (20%) or more of the combined voting power of Corporation's then outstanding securities ordinarily (and apart from rights accruing under special circumstances) having the right to vote at elections of directors (the "Capital Stock"), except that any change in ownership of Corporation's securities by any person resulting solely from a reduction in the aggregate number of outstanding shares of Capital Stock, and any decrease thereafter in such person's ownership of securities, shall be disregarded until such person increases in any manner, directly or indirectly, such person's beneficial ownership of any securities of Corporation. 2. Indemnity of Director. Corporation hereby agrees to hold harmless and --------------------- indemnify Director to the fullest extent authorized or permitted by the provisions of the Law, as may be amended from time to time. 3. Additional Indemnity. Subject only to the exclusions set forth in -------------------- Section 4 hereof, Corporation hereby further agrees to hold harmless and indemnify Director: (a) against any and all Expenses in connection with any Proceeding (including an action by or in the right of Corporation) to which Director is, was or at any time becomes a party, or is threatened to be made a party, by reason of the fact that Director is, was or at any time becomes a director, officer, employee or agent of Corporation, or is or was serving or at any time serves at the request of Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise; and (b) otherwise to the fullest extent as may be provided to Director by Corporation under the non-exclusivity provisions of the Bylaws of Corporation and the Law. 4. Limitations on Additional Indemnity. No indemnity pursuant to Section ----------------------------------- 3 hereof shall be paid by Corporation: (a) except to the extent the aggregate of losses to be indemnified thereunder exceeds the sum of such losses for which the Director is indemnified pursuant to Section 2 hereof or reimbursed pursuant to any D & O Insurance purchased and maintained by Corporation; (b) in respect of remuneration paid to Director if it shall be determined by a final judgment or other final adjudication that such remuneration was in violation of law; (c) on account of any Proceeding in which judgment is rendered against Director for an accounting of profits made from the purchase or sale by Director of securities of Corporation pursuant to the provisions of Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar provisions of any federal, state or local statutory law; (d) on account of a Final Adverse Determination that Director's conduct was knowingly fraudulent or deliberately dishonest or constituted willful misconduct; 3 (e) provided there has been no Change of Control, on account of or arising in response to any Proceeding (other than a Proceeding referred to in Section 10(b) hereof) initiated by Director or any of Director's affiliates against Corporation or any officer, director or stockholder of Corporation unless such Proceeding was authorized in the specific case by action of the Board of Directors of Corporation; (f) if a final decision by a Court having jurisdiction in the matter shall determine that such indemnification is not lawful; or (g) on account of any Proceeding to the extent that Director is a plaintiff, a counter-complainant or a cross-complainant therein (other than a Proceeding permitted by Section 4(e) hereof). 5. Procedure for Determination of Entitlement to Indemnification. ------------------------------------------------------------- (a) Whenever Director believes that he or she is entitled to indemnification pursuant to this Agreement, Director shall submit a written request for indemnification to Corporation. Any request for indemnification shall include sufficient documentation or information reasonably available to Director to support his or her claim for indemnification. Director shall submit his or her claim for indemnification within a reasonable time not to exceed five years after any judgment, order, settlement, dismissal, arbitration award, conviction, acceptance of a plea of nolo contendere or its equivalent, final termination or other disposition or partial disposition of any Proceeding, whichever is the later date for which Director requests indemnification. The President, Secretary or other appropriate officer shall, promptly upon receipt of Director's request for indemnification, advise the Board in writing that Director has made such a request. Determination of Director's entitlement to indemnification shall be made not later than ninety (90) days after Corporation's receipt of his or her written request for such indemnification. (b) The Director shall be entitled to select the forum in which Director's request for indemnification will be heard, which selection shall be included in the written request for indemnification required in Section 5(a). This forum shall be any one of the following: (i) The stockholders of Corporation; (ii) A quorum of the Board consisting of Disinterested Directors; (iii) Independent Legal Counsel, who shall make the determination in a written opinion; or (iv) A panel of three arbitrators, one selected by Corporation, another by Director and the third by the first two arbitrators selected. If for any reason three arbitrators are not selected within thirty (30) days after the appointment of the first arbitrator, then selection of additional arbitrators shall be made by the American Arbitration Association. If any arbitrator resigns or is unable to serve in such capacity for any reason, the American Arbitration Association shall select his or her replacement. The arbitration shall be conducted pursuant to the commercial arbitration rules of the American Arbitration Association now in effect. 4 If Director fails to make such designation, his or her claim shall be determined by the forum selected by Corporation. 6. Presumption and Effect of Certain Proceedings. Upon making a request --------------------------------------------- for indemnification, Director shall be presumed to be entitled to indemnification under this Agreement and Corporation shall have the burden of proof to overcome that presumption in reaching any contrary determination. The termination of any Proceeding by judgment, order, settlement, arbitration award or conviction, or upon a plea of nolo contendere or its equivalent shall not affect this presumption or, except as may be provided in Section 4 hereof, establish a presumption with regard to any factual matter relevant to determining Director's rights to indemnification hereunder. If the person or persons so empowered to make a determination pursuant to Section 5(b) hereof shall have failed to make the requested determination within thirty (30) days after any judgment, order, settlement, dismissal, arbitration award, conviction, acceptance of a plea of nolo contendere or its equivalent, or other disposition or partial disposition of any Proceeding or any other event which could enable Corporation to determine Director's entitlement to indemnification, the requisite determination that Director is entitled to indemnification shall be deemed to have been made. 7. Contribution. If the indemnification provided in Sections 2 and 3 is ------------ unavailable and may not be paid to Director for any reason other than those set forth in Section 4, then in respect of any Proceeding in which Corporation is or is alleged to be jointly liable with Director (or would be if joined in such Proceeding), Corporation shall contribute to the amount of Expenses and Liabilities paid or payable by Director in such proportion as is appropriate to reflect (i) the relative benefits received by Corporation on the one hand and Director on the other hand from the transaction from which such Proceeding arose, and (ii) the relative fault of Corporation on the one hand and of Director on the other hand in connection with the events which resulted in such Expenses and Liabilities, as well as any other relevant equitable considerations. The relative fault of Corporation on the one hand and of Director on the other shall be determined by reference to, among other things, the parties' relative intent, knowledge, access to information and opportunity to correct or prevent the circumstances resulting in such Expenses and Liabilities. Corporation agrees that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation or any other method of allocation which does not take account of the foregoing equitable considerations. 8. Insurance and Funding. Corporation hereby represents and warrants that --------------------- it shall purchase and maintain insurance to protect itself and/or Director against any Expenses and Liabilities in connection with any Proceeding to the fullest extent permitted by the Law. 9. Continuation of Obligations. All agreements and obligations of --------------------------- Corporation contained herein shall continue during the period Director is a director, officer, employee or agent of Corporation (or is or was serving at the request of Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise) and shall continue thereafter so long as Director shall be subject to any possible Proceeding, by reason of the fact that Director was serving Corporation or such other entity in any capacity referred to herein. 5 10. Notification and Defense of Claim. Promptly after receipt by Director --------------------------------- of notice of the commencement of any Proceeding, Director will, if a claim in respect thereof is to be made against Corporation under this Agreement, notify Corporation of the commencement thereof; but the omission so to notify Corporation will not relieve it from any liability which it may have to Director otherwise than under this Agreement. With respect to any Proceeding as to which Director notifies Corporation of the commencement thereof: (a) Corporation will be entitled to participate therein at its own expense; (b) Except as otherwise provided below, to the extent that it may wish, Corporation jointly with any other indemnifying party similarly notified will be entitled to assume the defense thereof, with counsel reasonably satisfactory to Director. After notice from Corporation to Director of its election to assume the defense thereof, Corporation will not be liable to Director under this Agreement for any Expenses subsequently incurred by Director in connection with the defense thereof other than reasonable costs of investigation or as otherwise provided below. Director shall have the right to employ his or her own counsel in such Proceeding but the Expenses associated with the employment of such counsel incurred after notice from Corporation of its assumption of the defense thereof shall be at the expense of Director unless (i) the employment of counsel by Director has been authorized by Corporation, (ii) Director shall have reasonably concluded that there may be a conflict of interest between Corporation and Director in the conduct of the defense of such Proceeding or (iii) Corporation shall not in fact have employed counsel to assume the defense of such Proceeding, in each of which cases the Expenses of Director's separate counsel shall be at the expense of Corporation. Corporation shall not be entitled to assume the defense of any Proceeding brought by or on behalf of Corporation or as to which Director shall have made the conclusion provided for in (ii) above; and (c) Provided there has been no Change of Control, Corporation shall not be liable to indemnify Director under this Agreement for any amounts paid in settlement of any Proceeding effected without its written consent, which consent shall not be unreasonably withheld. Corporation shall be permitted to settle any Proceeding except that it shall not settle any Proceeding in any manner which would impose any penalty, out-of-pocket liability, or limitation on Director without Director's written consent. 11. Advancement and Repayment of Expenses. ------------------------------------- (a) In the event that Director employs his or her own counsel pursuant to Section 10(b)(i) through (iii) above, Corporation shall advance to Director, prior to any final disposition of any Proceeding any and all Expenses incurred in investigating or defending any such Proceeding within ten (10) days after receiving copies of invoices presented to Director for such Expenses. (b) Director agrees that Director will reimburse Corporation for all Expenses paid by Corporation in defending any Proceeding against Director in the event and only to the extent that there has been a Final Adverse Determination that Director is not entitled, under the provisions of the Law, the Bylaws, this Agreement or otherwise, to be indemnified by Corporation for such Expenses. 6 12. Remedies of Director. -------------------- (a) In the event that (i) a determination pursuant to Section 5 hereof is made that Director is not entitled to indemnification, (ii) advances of Expenses are not made pursuant to this Agreement, (iii) payment has not been timely made following a determination of entitlement to indemnification pursuant to this Agreement, or (iv) Director otherwise seeks enforcement of this Agreement, Director shall be entitled to a final adjudication in an appropriate court of his or her rights. Alternatively, Director at his or her option may seek an award in arbitration to be conducted by a single arbitrator pursuant to the commercial arbitration rules of the American Arbitration Association now in effect, whose decision is to be made within ninety (90) days following the filing of the demand for arbitration. The Corporation shall not oppose Director's right to seek any such adjudication or arbitration award. (b) In the event that a determination that Director is not entitled to indemnification, in whole or in part, has been made pursuant to Section 5 hereof, the decision in the judicial proceeding or arbitration provided in paragraph (a) of this Section 12 shall be made de novo and Director shall not be prejudiced by reason of a determination that he or she is not entitled to indemnification. (c) If a determination that Director is entitled to indemnification has been made pursuant to Section 5 hereof or otherwise pursuant to the terms of this Agreement, Corporation shall be bound by such determination in the absence of (i) a misrepresentation of a material fact by Director or (ii) a specific finding (which has become final) by an appropriate court that all or any part of such indemnification is expressly prohibited by law. (d) In any court proceeding pursuant to this Section 12, Corporation shall be precluded from asserting that the procedures and presumptions of this Agreement are not valid, binding and enforceable. The Corporation shall stipulate in any such court or before any such arbitrator that Corporation is bound by all the provisions of this Agreement and is precluded from making any assertion to the contrary. (e) Expenses reasonably incurred by Director in connection with his or her request for indemnification under this Agreement, meeting enforcement of this Agreement or to recover damages for breach of this Agreement shall be borne by Corporation. (f) Corporation and Director agree herein that a monetary remedy for breach of this Agreement, at some later date, will be inadequate, impracticable and difficult to prove, and further agree that such breach would cause Director irreparable harm. Accordingly, Corporation and Director agree that Director shall be entitled to temporary and permanent injunctive relief to enforce this Agreement without the necessity of proving actual damages or irreparable harm. The Corporation and Director further agree that Director shall be entitled to such injunctive relief, including temporary restraining orders, preliminary injunctions and permanent injunctions, without the necessity of posting bond or other undertaking in connection therewith. Any such requirement of bond or undertaking is hereby waived by Corporation, and Corporation acknowledges that in the absence of such a waiver, a bond or undertaking may be required by the court. 7 13. Enforcement. Corporation expressly confirms and agrees that it has ----------- entered into this Agreement and assumed the obligations imposed on Corporation hereby in order to induce Director to continue as a director of Corporation, and acknowledges that Director is relying upon this Agreement in continuing in such capacity. 14. Separability. Each of the provisions of this Agreement is a separate ------------ and distinct agreement and independent of the others, so that if any or all of the provisions hereof shall be held to be invalid or unenforceable to any extent for any reason, such invalidity or unenforceability shall not affect the validity or enforceability of the other provisions hereof, or the obligation of the Corporation to indemnify the Director to the full extent provided by the Bylaws or the Law, and the affected provision shall be construed and enforced so as to effectuate the parties' intent to the maximum extent possible. 15. Governing Law. This Agreement shall be governed by and interpreted ------------- and enforced in accordance with the internal laws of the State of Delaware. 16. Consent to Jurisdiction. The Corporation and Director each ----------------------- irrevocably consent to jurisdiction of the courts of the State of Delaware for all purposes in connection with any Proceeding which arises out of or relates to this Agreement and agree that any Proceeding instituted under this Agreement shall be brought only in the state courts of the State of Delaware. 17. Binding Effect. This Agreement shall be binding upon Director and -------------- upon Corporation, its successors and assigns, and shall inure to the benefit of Director, his or her heirs, executors, administrators, personal representatives and assigns and to the benefit of Corporation, its successors and assigns. 18. Entire Agreement. This Agreement represents the entire agreement ---------------- between the parties hereto and there are no other agreements, contracts or understandings between the parties hereto with respect to the subject matter of this Agreement, except as specifically referred to herein. This Agreement supersedes any and all agreements regarding indemnification heretofore entered into by the parties. 19. Amendment and Termination. No amendment, modification, waiver, ------------------------- termination or cancellation of this Agreement shall be effective for any purpose unless set forth in writing signed by both parties hereto. 20. Subrogation. In the event of payment under this agreement, ----------- Corporation shall be subrogated to the extent of such payment to all of the rights of recovery of Director, who shall execute all documents required and shall do all acts that may be necessary to secure such rights and to enable Corporation effectively to bring suit to enforce such rights. 21. Non-Exclusivity of Rights. The rights conferred on Director by this ------------------------- Agreement shall not be exclusive of any other right which Director may have or hereafter acquire under any statute, provision of Corporation's Certificate of Incorporation or Bylaws, agreement, vote of stockholders or directors, or otherwise, both as to action in his official capacity and as to action in another capacity while holding office. 8 22. Survival of Rights. The rights conferred on Director by this ------------------ Agreement shall continue after Director has ceased to be a director, officer, employee or other agent of Corporation or such other entity. 23. Notices. All notices, requests, demands and other communications ------- hereunder shall be in writing and shall be addressed to Director or to Corporation, as the case may be, at the address shown on page 1 of this Agreement, or to such other address as may have been furnished by either party to the other, and shall be deemed to have been duly given if (a) delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed, or (b) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed. [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 9 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and as of the day and year first above written. DIRECTOR: COMPS.COM, INC., a Delaware corporation ______________________________ By: _______________________________ Its: _______________________________ 10 EX-10.23 28 FORM OF INDEMNIFICATION AGMT W/OFFICERS Exhibit 10.23 FORM OF INDEMNIFICATION AGREEMENT THIS AGREEMENT is made and entered into this ____ day of ___________, 1998 between COMPS.COM, INC., a Delaware corporation ("Corporation"), whose address is 9888 Carroll Centre Drive, Suite 100, San Diego, California 92126 and __________________ ("Officer"), whose address is __________________________________. RECITALS: -------- A. WHEREAS, Officer, an officer of Corporation (but not currently a member of the Board of Directors of Corporation (the "Board")), performs a valuable service in such capacity for Corporation; and B. WHEREAS, the stockholders of Corporation have adopted Bylaws (the "Bylaws") providing for the indemnification of the officers, directors, agents and employees of Corporation to the maximum extent authorized by Section 145 of the Delaware General Corporation Law, as amended (the "Law"); and C. WHEREAS, the Bylaws and the Law, as amended and in effect from time to time or any successor or other statutes of Delaware having similar import and effect, currently purport to be the controlling law governing Corporation with respect to certain aspects of corporate law, including indemnification of directors and officers; and D. WHEREAS, in accordance with the authorization provided by the Law, Corporation may from time to time purchase and maintain a policy or policies of Directors and Officers Liability Insurance ("D & O Insurance"), covering certain liabilities which may be incurred by its directors and officers in the performance of services as directors and officers of Corporation; and E. WHEREAS, as a result of developments affecting the terms, scope and availability of D & O Insurance there exists general uncertainty as to the extent and overall desirability of protection afforded officers by such D & O Insurance, if any, and by statutory and bylaw indemnification provisions; and F. WHEREAS, in order to induce Officer to continue to serve as an officer of Corporation, Corporation has determined and agreed to enter into this contract with Officer. NOW, THEREFORE, in consideration of Officer's continued service as an officer after the date hereof, the parties hereto agree as follows: 1. Certain Definitions. The following terms used in this Agreement shall ------------------- have the meanings set forth below. Other terms are defined where appropriate in this Agreement. (a) "Disinterested Director" shall mean a director of Corporation who ---------------------- is not or was not a party to the Proceeding in respect of which indemnification is being sought by Officer. (b) "Expenses" shall include all direct and indirect costs (including, -------- without limitation, attorneys' fees, retainers, court costs, transcripts, fees of experts, witness fees, travel 1 expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, all other disbursements or out-of-pocket expenses and reasonable compensation for time spent by Officer for which he or she is otherwise not compensated by Corporation) actually and reasonably incurred in connection with a Proceeding or establishing or enforcing a right to indemnification under this Agreement, applicable law or otherwise; provided, however, that "Expenses" shall not include any Liabilities. (c) "Final Adverse Determination" shall mean that a determination that --------------------------- Officer is not entitled to indemnification shall have been made pursuant to Section 5 hereof and either (i) a final adjudication in a Delaware court or decision of an arbitrator pursuant to Section 13(a) hereof shall have denied Officer's right to indemnification hereunder, or (ii) Officer shall have failed to file a complaint in a Delaware court or seek an arbitrator's award pursuant to Section 13(a) for a period of one hundred twenty (120) days after the determination made pursuant to Section 5 hereof. (d) "Independent Legal Counsel" shall mean a law firm or member of a ------------------------- law firm selected by Corporation and approved by Officer (which approval shall not be unreasonably withheld) and that neither is presently nor in the past five years has been retained to represent: (i) Corporation, in any material matter, or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term "Independent Legal Counsel" shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either Corporation or Officer in a Proceeding to determine Officer's right to indemnification under this Agreement. (e) "Liabilities" shall mean liabilities of any type whatsoever ----------- including, but not limited to, any judgments, fines, ERISA excise taxes and penalties, and penalties and amounts paid in settlement (including all interest assessments and other charges paid or payable in connection with or in respect of such judgments, fines, penalties or amounts paid in settlement) of any proceeding. (f) "Proceeding" shall mean any threatened, pending or completed ---------- action, claim, suit, arbitration, alternative dispute resolution mechanism, investigation, administrative hearing or any other proceeding whether civil, criminal, administrative or investigative, including any appeal therefrom. (g) "Change of Control" shall mean the occurrence of any of the ----------------- following events after the date of this Agreement: (i) A change in the composition of the Board, as a result of which fewer than two-thirds (2/3) of the incumbent directors are directors who either (1) had been directors of Corporation twenty-four (24) months prior to such change or (2) were elected, or nominated for election, to the Board with the affirmative votes of at least a majority of the directors who had been directors of Corporation 24 months prior to such change and who were still in office at the time of the election or nomination; or (ii) Any "person" (as such term is used in section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) through the acquisition or aggregation of 2 securities is or becomes the beneficial owner, directly or indirectly, of securities of Corporation representing twenty percent (20%) or more of the combined voting power of Corporation's then outstanding securities ordinarily (and apart from rights accruing under special circumstances) having the right to vote at elections of directors (the "Capital Stock"), except that any change in ownership of Corporation's securities by any person resulting solely from a reduction in the aggregate number of outstanding shares of Capital Stock, and any decrease thereafter in such person's ownership of securities, shall be disregarded until such person increases in any manner, directly or indirectly, such person's beneficial ownership of any securities of Corporation. 2. Indemnity of Officer. Corporation hereby agrees to hold harmless and -------------------- indemnify Officer to the fullest extent authorized or permitted by the provisions of the Law, as may be amended from time to time. 3. Additional Indemnity. Subject only to the exclusions set forth in -------------------- Section 4 hereof, Corporation hereby further agrees to hold harmless and indemnify Officer: (a) against any and all Expenses in connection with any Proceeding (including an action by or in the right of Corporation) to which Officer is, was or at any time becomes a party, or is threatened to be made a party, by reason of the fact that Officer is, was or at any time becomes a director, officer, employee or agent of Corporation, or is or was serving or at any time serves at the request of Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise; and (b) otherwise to the fullest extent as may be provided to Officer by Corporation under the non-exclusivity provisions of the Bylaws of Corporation and the Law. 4. Limitations on Additional Indemnity. No indemnity pursuant to Section ----------------------------------- 3 hereof shall be paid by Corporation: (a) except to the extent the aggregate of losses to be indemnified thereunder exceeds the sum of such losses for which the Officer is indemnified pursuant to Section 2 hereof or reimbursed pursuant to any D & O Insurance purchased and maintained by Corporation; (b) in respect of remuneration paid to Officer if it shall be determined by a final judgment or other final adjudication that such remuneration was in violation of law; (c) on account of any Proceeding in which judgment is rendered against Officer for an accounting of profits made from the purchase or sale by Officer of securities of Corporation pursuant to the provisions of Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar provisions of any federal, state or local statutory law; (d) on account of a Final Adverse Determination that Officer's conduct was knowingly fraudulent or deliberately dishonest or constituted willful misconduct; (e) provided there has been no Change of Control, on account of or arising in response to any Proceeding (other than a Proceeding referred to in Section 10(b) hereof) initiated by Officer or any of Officer's affiliates against Corporation or any officer, director or stockholder 3 of Corporation unless such Proceeding was authorized in the specific case by action of the Board; (f) if a final decision by a Court having jurisdiction in the matter shall determine that such indemnification is not lawful; or (g) on account of any Proceeding to the extent that Officer is a plaintiff, a counter-complainant or a cross-complainant therein (other than a Proceeding permitted by Section 4(e) hereof). 5. Procedure for Determination of Entitlement to Indemnification. ------------------------------------------------------------- (a) Whenever Officer believes that he or she is entitled to indemnification pursuant to this Agreement, Officer shall submit a written request for indemnification to Corporation. Any request for indemnification shall include sufficient documentation or information reasonably available to Officer to support his or her claim for indemnification. Officer shall submit his or her claim for indemnification within a reasonable time not to exceed five years after any judgment, order, settlement, dismissal, arbitration award, conviction, acceptance of a plea of nolo contendere or its equivalent, final termination or other disposition or partial disposition of any Proceeding, whichever is the later date for which Officer requests indemnification. The President, Secretary or other appropriate officer shall, promptly upon receipt of Officer's request for indemnification, advise the Board in writing that Officer has made such a request. Determination of Officer's entitlement to indemnification shall be made not later than ninety (90) days after Corporation's receipt of his or her written request for such indemnification. (b) The Officer shall be entitled to select the forum in which Officer's request for indemnification will be heard, which selection shall be included in the written request for indemnification required in Section 5(a). This forum shall be any one of the following: (i) The stockholders of Corporation; (ii) A quorum of the Board consisting of Disinterested Directors; (iii) Independent Legal Counsel, who shall make the determination in a written opinion; or (iv) A panel of three arbitrators, one selected by Corporation, another by Officer and the third by the first two arbitrators selected. If for any reason three arbitrators are not selected within thirty (30) days after the appointment of the first arbitrator, then selection of additional arbitrators shall be made by the American Arbitration Association. If any arbitrator resigns or is unable to serve in such capacity for any reason, the American Arbitration Association shall select his or her replacement. The arbitration shall be conducted pursuant to the commercial arbitration rules of the American Arbitration Association now in effect. If Officer fails to make such designation, his or her claim shall be determined by the forum selected by Corporation. 4 6. Presumption and Effect of Certain Proceedings. Upon making a request --------------------------------------------- for indemnification, Officer shall be presumed to be entitled to indemnification under this Agreement and Corporation shall have the burden of proof to overcome that presumption in reaching any contrary determination. The termination of any Proceeding by judgment, order, settlement, arbitration award or conviction, or upon a plea of nolo contendere or its equivalent shall not affect this presumption or, except as may be provided in Section 4 hereof, establish a presumption with regard to any factual matter relevant to determining Officer's rights to indemnification hereunder. If the person or persons so empowered to make a determination pursuant to Section 5(b) hereof shall have failed to make the requested determination within thirty (30) days after any judgment, order, settlement, dismissal, arbitration award, conviction, acceptance of a plea of nolo contendere or its equivalent, or other disposition or partial disposition of any Proceeding or any other event which could enable Corporation to determine Officer's entitlement to indemnification, the requisite determination that Officer is entitled to indemnification shall be deemed to have been made. 7. Contribution. If the indemnification provided in Sections 2 and 3 is ------------ unavailable and may not be paid to Officer for any reason other than those set forth in Section 4, then in respect of any Proceeding in which Corporation is or is alleged to be jointly liable with Officer (or would be if joined in such Proceeding), Corporation shall contribute to the amount of Expenses and Liabilities paid or payable by Officer in such proportion as is appropriate to reflect (i) the relative benefits received by Corporation on the one hand and Officer on the other hand from the transaction from which such Proceeding arose, and (ii) the relative fault of Corporation on the one hand and of Officer on the other hand in connection with the events which resulted in such Expenses and Liabilities, as well as any other relevant equitable considerations. The relative fault of Corporation on the one hand and of Officer on the other shall be determined by reference to, among other things, the parties' relative intent, knowledge, access to information and opportunity to correct or prevent the circumstances resulting in such Expenses and Liabilities. Corporation agrees that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation or any other method of allocation which does not take account of the foregoing equitable considerations. 8. Insurance and Funding. Corporation hereby represents and warrants that --------------------- it shall purchase and maintain insurance to protect itself and/or Officer against any Expenses and Liabilities in connection with any Proceeding to the fullest extent permitted by the Law. 9. Continuation of Obligations. All agreements and obligations of --------------------------- Corporation contained herein shall continue during the period Officer is a director, officer, employee or agent of Corporation (or is or was serving at the request of Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise) and shall continue thereafter so long as Officer shall be subject to any possible Proceeding, by reason of the fact that Officer was serving Corporation or such other entity in any capacity referred to herein. 10. Notification and Defense of Claim. Promptly after receipt by Officer --------------------------------- of notice of the commencement of any Proceeding, Officer will, if a claim in respect thereof is to be made against Corporation under this Agreement, notify Corporation of the commencement thereof; but the omission so to notify Corporation will not relieve it from any liability which it may have to 5 Officer otherwise than under this Agreement. With respect to any Proceeding as to which Officer notifies Corporation of the commencement thereof: (a) Corporation will be entitled to participate therein at its own expense; (b) Except as otherwise provided below, to the extent that it may wish, Corporation jointly with any other indemnifying party similarly notified will be entitled to assume the defense thereof, with counsel reasonably satisfactory to Officer. After notice from Corporation to Officer of its election to assume the defense thereof, Corporation will not be liable to Officer under this Agreement for any Expenses subsequently incurred by Officer in connection with the defense thereof other than reasonable costs of investigation or as otherwise provided below. Officer shall have the right to employ his or her own counsel in such Proceeding but the Expenses associated with the employment of such counsel incurred after notice from Corporation of its assumption of the defense thereof shall be at the expense of Officer unless (i) the employment of counsel by Officer has been authorized by Corporation, (ii) Officer shall have reasonably concluded that there may be a conflict of interest between Corporation and Officer in the conduct of the defense of such Proceeding or (iii) Corporation shall not in fact have employed counsel to assume the defense of such Proceeding, in each of which cases the Expenses of Officer's separate counsel shall be at the expense of Corporation. Corporation shall not be entitled to assume the defense of any Proceeding brought by or on behalf of Corporation or as to which Officer shall have made the conclusion provided for in (ii) above; and (c) Provided there has been no Change of Control, Corporation shall not be liable to indemnify Officer under this Agreement for any amounts paid in settlement of any Proceeding effected without its written consent, which consent shall not be unreasonably withheld. Corporation shall be permitted to settle any Proceeding except that it shall not settle any Proceeding in any manner which would impose any penalty, out-of-pocket liability, or limitation on Officer without Officer's written consent. 11. Advancement and Repayment of Expenses. ------------------------------------- (a) In the event that Officer employs his or her own counsel pursuant to Section 10(b)(i) through (iii) above, Corporation shall advance to Officer, prior to any final disposition of any Proceeding any and all Expenses incurred in investigating or defending any such Proceeding within ten (10) days after receiving copies of invoices presented to Officer for such Expenses. (b) Officer agrees that Officer will reimburse Corporation for all Expenses paid by Corporation in defending any Proceeding against Officer in the event and only to the extent that there has been a Final Adverse Determination that Officer is not entitled, under the provisions of the Law, the Bylaws, this Agreement or otherwise, to be indemnified by Corporation for such Expenses. 12. Remedies of Officer. ------------------- (a) In the event that (i) a determination pursuant to Section 5 hereof is made that Officer is not entitled to indemnification, (ii) advances of Expenses are not made pursuant to 6 this Agreement, (iii) payment has not been timely made following a determination of entitlement to indemnification pursuant to this Agreement, or (iv) Officer otherwise seeks enforcement of this Agreement, Officer shall be entitled to a final adjudication in an appropriate court of his or her rights. Alternatively, Officer at his or her option may seek an award in arbitration to be conducted by a single arbitrator pursuant to the commercial arbitration rules of the American Arbitration Association now in effect, whose decision is to be made within ninety (90) days following the filing of the demand for arbitration. The Corporation shall not oppose Officer's right to seek any such adjudication or arbitration award. (b) In the event that a determination that Officer is not entitled to indemnification, in whole or in part, has been made pursuant to Section 5 hereof, the decision in the judicial proceeding or arbitration provided in paragraph (a) of this Section 12 shall be made de novo and Officer shall not be prejudiced by reason of a determination that he or she is not entitled to indemnification. (c) If a determination that Officer is entitled to indemnification has been made pursuant to Section 5 hereof or otherwise pursuant to the terms of this Agreement, Corporation shall be bound by such determination in the absence of (i) a misrepresentation of a material fact by Officer or (ii) a specific finding (which has become final) by an appropriate court that all or any part of such indemnification is expressly prohibited by law. (d) In any court proceeding pursuant to this Section 12, Corporation shall be precluded from asserting that the procedures and presumptions of this Agreement are not valid, binding and enforceable. The Corporation shall stipulate in any such court or before any such arbitrator that Corporation is bound by all the provisions of this Agreement and is precluded from making any assertion to the contrary. (e) Expenses reasonably incurred by Officer in connection with his or her request for indemnification under this Agreement, meeting enforcement of this Agreement or to recover damages for breach of this Agreement shall be borne by Corporation. (f) Corporation and Officer agree herein that a monetary remedy for breach of this Agreement, at some later date, will be inadequate, impracticable and difficult to prove, and further agree that such breach would cause Officer irreparable harm. Accordingly, Corporation and Officer agree that Officer shall be entitled to temporary and permanent injunctive relief to enforce this Agreement without the necessity of proving actual damages or irreparable harm. The Corporation and Officer further agree that Officer shall be entitled to such injunctive relief, including temporary restraining orders, preliminary injunctions and permanent injunctions, without the necessity of posting bond or other undertaking in connection therewith. Any such requirement of bond or undertaking is hereby waived by Corporation, and Corporation acknowledges that in the absence of such a waiver, a bond or undertaking may be required by the court. 13. Enforcement. Corporation expressly confirms and agrees that it has ----------- entered into this Agreement and assumed the obligations imposed on Corporation hereby in order to induce Officer to continue as an officer of Corporation, and acknowledges that Officer is relying upon this Agreement in continuing in such capacity. 7 14. Separability. Each of the provisions of this Agreement is a separate ------------ and distinct agreement and independent of the others, so that if any or all of the provisions hereof shall be held to be invalid or unenforceable to any extent for any reason, such invalidity or unenforceability shall not affect the validity or enforceability of the other provisions hereof, or the obligation of the Corporation to indemnify the Officer to the full extent provided by the Bylaws or the Law, and the affected provision shall be construed and enforced so as to effectuate the parties' intent to the maximum extent possible. 15. Governing Law. This Agreement shall be governed by and interpreted ------------- and enforced in accordance with the internal laws of the State of Delaware. 16. Consent to Jurisdiction. The Corporation and Officer each irrevocably ----------------------- consent to jurisdiction of the courts of the State of Delaware for all purposes in connection with any Proceeding which arises out of or relates to this Agreement and agree that any Proceeding instituted under this Agreement shall be brought only in the state courts of the State of Delaware. 17. Binding Effect. This Agreement shall be binding upon Officer and upon -------------- Corporation, its successors and assigns, and shall inure to the benefit of Officer, his or her heirs, executors, administrators, personal representatives and assigns and to the benefit of Corporation, its successors and assigns. 18. Entire Agreement. This Agreement represents the entire agreement ---------------- between the parties hereto and there are no other agreements, contracts or understandings between the parties hereto with respect to the subject matter of this Agreement, except as specifically referred to herein. This Agreement supersedes any and all agreements regarding indemnification heretofore entered into by the parties. 19. Amendment and Termination. No amendment, modification, waiver, ------------------------- termination or cancellation of this Agreement shall be effective for any purpose unless set forth in writing signed by both parties hereto. 20. Subrogation. In the event of payment under this agreement, ----------- Corporation shall be subrogated to the extent of such payment to all of the rights of recovery of Officer, who shall execute all documents required and shall do all acts that may be necessary to secure such rights and to enable Corporation effectively to bring suit to enforce such rights. 21. Non-Exclusivity of Rights. The rights conferred on Officer by this ------------------------- Agreement shall not be exclusive of any other right which Officer may have or hereafter acquire under any statute, provision of Corporation's Certificate of Incorporation or Bylaws, agreement, vote of stockholders or directors, or otherwise, both as to action in his official capacity and as to action in another capacity while holding office. 22. Survival of Rights. The rights conferred on Officer by this Agreement ------------------ shall continue after Officer has ceased to be a director, officer, employee or other agent of Corporation or such other entity. 23. Notices. All notices, requests, demands and other communications ------- hereunder shall be in writing and shall be addressed to Officer or to Corporation, as the case may be, at the 8 address shown on page 1 of this Agreement, or to such other address as may have been furnished by either party to the other, and shall be deemed to have been duly given if (a) delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed, or (b) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed. [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK] 9 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and as of the day and year first above written. OFFICER: COMPS.COM, INC., a Delaware corporation ______________________________ By: _______________________________ Its: _______________________________ 10 EX-10.24 29 SOFTWARE LICENSE AGMT DATED 2/27/97 Exhibit 10.24 SOFTWARE LICENSE AGREEMENT -------------------------- THIS SOFTWARE LICENSE AGREEMENT (the "Agreement") is made and entered into as of this 27th day of February, 1997 (the "Effective Date"), by and between QUALITATIVE MARKETING SOFTWARE, INC. ("Licensor"), a Delaware corporation with its principal offices located at 28051 U.S. Highway 19 North, Suite E, Clearwater, Florida 34621-2647, and COMPS INFOSYSTEMS, INC. ("Licensee"), a Delaware corporation with its principal offices located at 9888 Carroll Centre Road, Suite 100, San Diego, California 92126-4580. R E C I T A L S: WHEREAS, Licensor, as the result of the expenditure of time, skill, effort and money, has designed, developed, and produced, and is the owner of the entire right, title and interest in and to, certain software and databases and the documentation associated therewith as more particularly described on Schedule A ---------- attached hereto (defined below, collectively, as the "Licensed Products"); and WHEREAS, Licensee desires to obtain from Licensor, and Licensor desires to grant to Licensee, a non-exclusive, non-transferable, non-assignable license to use the Licensed Products solely for the Licensed Use, in accordance with the terms and conditions set forth herein. NOW, THEREFORE, in consideration of the premises, which shall be deemed an integral part of this Agreement and not as mere recitals hereto, and in consideration of the mutual covenants, representations, agreements and conditions herein contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound thereby, agree as follows: 1. DEFINITIONS. ----------- 1.1 Definitions. As used in this Agreement, the following terms (which appear herein as capitalized terms) shall have the meaning set forth below: "Affiliate," when used with respect to any Person. shall mean any ---------- Person controlling, controlled by or under common control with such Person. "Agreement" shall mean this Software License Agreement, as originally --------- executed and as amended, modified or supplemented thereafter in accordance with its terms. CSF PW - --- -- Licensee Licensor 1 "Business Day" shall mean a day which is not a Saturday or a Sunday or ------------ a bank holiday under the laws of the United States. "CASS" shall mean Coding Accuracy Support System as defined by the ---- USPS. "CPU" shall mean a single computer central processing unit, including --- its associated equipment. "Communications" shall have the meaning specified in Section 22.l. -------------- "Confidential Information" shall have the meaning specified in Section ------------------------ 16. 1. "Database Update" shall mean a change, modification or other update of --------------- any Database. "Databases" shall mean the directories and other files more --------- particularly described on Schedule A attached hereto under the caption ---------- "Databases," as they exist on the Effective Date and any Database Updates thereto. "Designated CPU" shall mean a single computer central processing unit, -------------- including its associated equipment, owned or leased by Licensee, the manufacturer, operating system and location of which are specified on Schedule B ---------- attached hereto. "Disputes" shall have the meaning specified in Section 23.5. -------- "Documentation" shall mean the standard user manual or other ------------- documentation or explanatory material related to the Licensed Software and the Databases more particularly described on Schedule A attached hereto under the caption "Documentation," developed by Licensor and supplied by Licensor to Licensee for use in connection with the Licensed Software and the Databases, and any subsequent versions thereof which Licensee may receive from Licensor. "Effective Date" shall have the meaning specified in the first -------------- sentence of this Agreement, which shall be deemed to be the date of execution of this Agreement by Licensor and Licensee. "Equipment" shall mean the hardware and other equipment comprising the --------- system in which the Licensed Software and Databases are installed, including the Designated CPU. CSF PW - --- -- Licensee Licensor 2 "Initial License Fee" shall have the meaning specified in Section 3.1. ------------------- "Initial Term" shall have the meaning specified in Section 4. 1. ------------ "License" shall mean the license granted to Licensee by Licensor ------- pursuant to Section 2. 1. "Licensed Products" shall mean the Licensed Software, the Databases ----------------- arid the Documentation. "Licensed Software" shall mean the object code (machine readable) ----------------- version of Licensor's computer software program more particularly described on Schedule A attached hereto under the caption "Licensed Software," as it exists on the Effective Date and any Updates and Upgrades thereto. "Licensed Software" shall not include the source code version. "Licensed Use" shall mean and be restricted to the reading into and ------------ out of memory of the Licensed Software and the Databases and the execution of the Licensed Software and the Databases, in whole or in part, by the Designated CPU solely for the internal purposes of Licensee in connection with the operation of the Licensee Services, and the utilization of the Documentation in connection therewith. "Licensed Use" shall not include the transmission of any of the Licensed Software or the Databases via any on-line service or telecommunication network or on the Internet. "Licensee" shall mean the entity specified in the first sentence of -------- this Agreement as Licensee. "Licensee Services" shall mean standardizing addresses and appending ----------------- geographic coordinates to Licensee's data during data entry. Licensee will be permitted to license its data to third parties, provided that Licensee is not in violation of any other agreement, including the BLR Agreement for the BLR Geocoding database. "Licensor" shall mean the entity specified in the first sentence of -------- this Agreement as Licensor. "Losses" shall mean any and all claims, demands, costs, losses, ------ damages, liabilities, fines, penalties and expenses (including, without limitation, reasonable attorneys' fees) of any kind or nature whatsoever, whether imposed, incurred or asserted. CSF PW - --- -- Licensee Licensor 3 "MSP" shall mean the Maintenance Support Program to be provided by --- Licensor to Licensee hereunder in connection with the Licensed Products, as more particularly described in Section 8. "Person" shall mean any corporation, association, partnership, joint ------ venture, trust, organization, business, individual, government, governmental agency or political subdivision thereof, or any other entity or institution of any type whatsoever. "Renewal Date" shall mean the first day of any Renewal Term. ------------ "Renewal License Fee" shall have the meaning specified in Section 3.2. ------------------- "Renewal Term" shall have the meaning specified in Section 4.2. ------------ "Restrictions on Use" shall have the meaning specified in Section 2.l. ------------------- "USPS" shall mean the United States Postal Service. ---- "Update" shall mean a change, modification or other update of the ------ Licensed Software made to correct an error (i.e., bug fix), defect or other problem and/or to maintain the operational quality of the Licensed Software, which is not an Upgrade. "Upgrade" shall mean a new release of the Licensed Software, or any ------- part thereof, which adds major new functionality or features to the last version of the Licensed Software. "Warranty Period" shall have the meaning specified in Section 12. 1. --------------- 2. GRANT OF LICENSE. ---------------- 2.1 Grant of License. Subject to the terms and conditions set forth in this Agreement (including the full payment of all license fees), Licensor hereby grants to Licensee during the term of this Agreement, and Licensee hereby accepts, a non-exclusive, non-transferable, non-assignable license (the "License") (i) to use the Licensed Software and the Databases only on the Designated CPU for the Licensed Use and (ii) to use the Documentation in support of the Licensed Use, provided that, the License granted hereunder shall be subject to the restrictions set forth on Schedule A attached hereto ---------- (collectively, the "Restrictions on Use"). CSF PW - --- -- Licensee Licensor 4 2.2 Licensed Use. The Licensed Software and the Databases may be used only on the Designated CPU and the Licensed Products may be used solely to process Licensee's own data in connection with the Licensee Services; it being expressly understood and agreed by Licensee that "Licensed Use" shall not include using the Licensed Products at the request of or for the benefit of any third parties or otherwise transmitting data via any telecommunication source, device or medium. 2.3 Additional Licenses. Licensee understands that the Licensed Software and the Databases cannot be transferred to, or used in connection with, any CPU that is not licensed by Licensor to operate the Licensed Software and the Databases. In the event Licensee desires to use the Licensed Software and the Databases on additional CPU(s), Licensee shall first obtain an additional license from Licensor for the Licensed Software and Databases for each such additional CPU(s). Licensee acknowledges that such additional licenses shall be made available to Licensee at Licensor's then-prevailing license fees. 2.4 Upgrades. Some of the Upgrades produced by Licensor during the term of this Agreement may include additional functionality or features which go beyond the scope of the capabilities of the Licensed Software delivered by Licensor pursuant to this Agreement and which require additional databases. If Licensee requests any such Upgrade (including any additional databases), Licensee acknowledges that this will require an additional license from Licensor and that Licensee will be charged an additional license fee in connection therewith. 2.5 Transfer of License. Licensee may not, directly or indirectly, sell, assign, sublicense, lease, rent, distribute, or otherwise transfer the License, the Licensed Products, or any rights therein to any other Person, or to any other computer other than the Designated CPU, unless Licensee first obtains the written consent of Licensor. 2.6 Non-Exclusive Nature. Licensee acknowledges and agrees that the License granted hereunder and the relationship between the parties is non- exclusive. Licensee further acknowledges and agrees that Licensor retains the right to grant similar licenses to use the Licensed Products to other Persons. 2.7 No Sale and Purchase or Lease. Notwithstanding anything to the contrary contained herein, the parties agree that this transaction is not a sale and purchase nor a lease of the Licensed Products. 3. LICENSE FEES; OTHER CHARGES; TAXES. ---------------------------------- 3.1 Initial License Fee. In consideration of the License and other rights granted by Licensor to Licensee hereunder, Licensee shall pay to Licensor the initial license fee set forth on Schedule C attached hereto (the "Initial ---------- License Fee") for the Initial Term, in accordance with CSF PW - --- -- Licensee Licensor 5 the payment schedule set forth therein. Licensee acknowledges and agrees that the Initial License Fee shall be deemed nonrefundable and fully earned by Licensor upon payment thereof by Licensee in consideration of the administrative and other expenses incurred by Licensor in granting the License to Licensee. 3.2 Renewal License Fee. In the event this Agreement and the License granted hereunder are renewed pursuant to Section 4.2, Licensee shall pay to Licensor the renewal license fee set forth on Schedule D attached hereto (the ---------- "Renewal License Fee") for each Renewal Term, in accordance with the payment schedule set forth therein. Licensee acknowledges and agrees that the Renewal License Fee shall be deemed non-refundable and fully earned by Licensor upon payment therefor by Licensee. 3.3 Maintenance Support Program Fees. Except as otherwise set forth herein, the fee for any Updates, Database Updates, Upgrades. or consulting or other services relating to the Licensed Products which Licensor performs in connection with the MSP shall be as set forth on Schedules C and D attached ----------- - hereto, and shall be payable in accordance with the payment schedule set forth therein. Licensee acknowledges and agrees that the MSP fees shall be deemed nonrefundable and fully earned by Licensor upon payment therefor by Licensee. 3.4 Out-of-Pocket Expenses. All reasonable, pre-approved out-of-pocket expenses incurred by Licensor in performing its obligations under this Agreement, including but not limited to travel, meals, and lodging, shall be paid by Licensee within thirty (30) days after Licensee's receipt of the invoice therefor. 3.5 Payment; Interest Charges. Except as otherwise set forth herein, all fees, charges and expenses to be paid by Licensee pursuant to this Agreement are due and payable upon Licensee's receipt of Licensor's invoice therefor. All amounts not paid when due shall bear interest at the rate of one and one-half percent (1.5%) per month or at the highest contract rate allowed by law, whichever is less, from the date due until paid, which interest shall be added to the unpaid amount due and owing by Licensee to Licensor. Subject to the right to cure set forth in Section 17.3.1, the failure of Licensee to pay any amounts when due shall constitute sufficient cause for Licensor to suspend or terminate this Agreement, including Licensor's obligation to provide the MSP (including any Updates, Database Updates and Upgrades) and all express warranties of Licensor under Section 12.l. In addition, Licensee agrees to pay all costs involved in collecting overdue amounts, including reasonable attorneys' fees. 3.6 Applicable Taxes. In addition to the fees and charges due hereunder, Licensee shall be liable for all local, state and federal sales, use, withholding, excise, personal property, value-added, or other similar taxes, assessments or duties which may now or hereafter be imposed upon this Agreement or which are based on or in any way relating to this Agreement, the Licensed Products, or any services related thereto, excluding, however, taxes measured on Licensor's income. Licensee shall pay or reimburse Licensor for any such taxes and Licensor CSF PW - --- -- Licensee Licensor 6 may add such taxes to the invoices submitted to Licensee by Licensor as provided herein. Licensee agrees to indemnify Licensor as to all such taxes. 3.7 No Right of Setoff. Licensee shall have no right of setoff against any payments due Licensor pursuant to this Agreement, whether on account of any claims or alleged claims against Licensor under this Agreement or otherwise. 4. TERM; RENEWAL. ------------- 4.1 Term. The term of this Agreement shall commence on the Effective Date and shall continue and remain in full force and effect for a period of one (1) year from the Effective Date (the "Initial Term"), unless otherwise earlier terminated in accordance with the provisions of Section 17. 4.2 Renewal. Except as otherwise provided herein, upon the expiration of the Initial Term or any Renewal Term, as the case may be, this Agreement shall be automatically renewed for an additional one (1) year period (each such year a "Renewal Term") without notice unless no less than sixty (60) days prior to the expiration of the Initial Term or any Renewal Term, as the case may be, either party notifies the other party in writing of its intent not to renew this Agreement. If no such notice is received within said time frame, Licensee shall be deemed to have renewed this Agreement and shall pay for all charges and fees in connection therewith in accordance with Section 3.2. Notwithstanding anything to the contrary contained herein, this Agreement shall not be renewed if, at the Renewal Date, any of the following conditions have not been satisfied (unless waived by Licensor in writing): 4.2.1 Licensee shall not be in default in any payments due to Licensor under this Agreement or any other agreement and shall have timely met all such obligations; 4.2.2 Licensee shall not be in breach or violation of any of the other terms, conditions or provisions of this Agreement or any other agreement between Licensee and Licensor; and 4.2.3 Licensee shall have paid to Licensor the Renewal License Fee. The determination as to the satisfaction of any of the above conditions by Licensee is in the sole discretion of Licensor. Licensor may determine to refuse to renew this Agreement, where any of the above conditions are not met, at any time at or prior to the Renewal Date. CSF PW - --- -- Licensee Licensor 7 5. PROPERTY RIGHTS. --------------- 5.1 Property Rights in Licensor. Licensee acknowledges that: (i) Licensor owns the full right, title and interest in and to the Licensed Products and all copies thereof, including all associated patents, copyrights, trademarks, trade names, trade secrets and other intellectual property rights; (ii) all right, title and interest in and to the Licensed Products and all copies thereof, including all associated patents, copyrights, trademarks, trade names, trade secrets and other intellectual property rights, are, and shall at all times remain, the exclusive property of Licensor; and (iii) Licensee shall have no right or interest as to the Licensed Products or any copies thereof, including all associated patents, copyrights, trademarks, trade names, trade secrets and other intellectual property rights, except as a licensee as expressly set forth in this Agreement. 5.2 Third Party Data Files. Notwithstanding anything to the contrary contained Herein, Licensor does not own, and Licensee shall have no right or interest in, any third party data files used to prepare the Databases, including any USPS data files. Licensor shall be responsible for paying all fees due to third parties for the license of such data files. 5.3 BLR Geocoding File. Licensee acknowledges that the geocoding data is being licensed directly from Business Location Research (BLR) and all license fees due for such license shall be paid directly to BLR. Licensee further acknowledges that Licensor will require written notice from BLR of such license. In the event Licensee fails to maintain the license with BLR, or if said license is canceled or terminated, the same shall not terminate this Agreement or Licensee's obligations hereunder, including payment of the Initial License Fee or Renewal License Fee, as the case may be. In the event the license for use of the BLR Geocoding database between Licensee and BLR is terminated, Licensee will pay Licensor the license fee for the QMS Geocoding database as set forth in Schedule D attached hereto. - ---------- 6. DELIVERY OF LICENSED PRODUCTS; RISK OF LOSS. ------------------------------------------- 6.1 Delivery of Licensed Products. Within a reasonable time after the Effective Date, Licensor shall furnish Licensee one (1) master copy of the Licensed Products. Licensor shall not be liable to Licensee for any delay in the delivery of the Licensed Products. 6.2 Risk of Loss. Upon delivery of the Licensed Products, Licensee assumes all risk of loss with respect to the Licensed Products. 7. INSTALLATION; TRAINING. ---------------------- 7.1 Installation. Licensee shall be solely responsible for installing the Licensed Software and the Databases on the Designated CPU. Licensee may request assistance from CSF PW - --- -- Licensee Licensor 8 Licensor in the installation of the Licensed Software and the Databases, which services shall be charged to Licensee at Licensor's then-current hourly rates. 7.2 Data Entry. Data entry and verification of the data input to and output from the Licensed Software and the Databases shall be the sole responsibility of Licensee. Licensee shall be responsible for the conversion of its current data to the format required by the Licensed Software and the Databases. 7.3 Training. No training in the use of the Licensed Products will be provided by Licensor. Licensee may request training assistance from Licensor, which training shall be charged to Licensee at Licensor's then-current hourly rates. 8. MAINTENANCE SUPPORT PROGRAM. --------------------------- 8.1 Maintenance Support Program. During the Initial Term and each Renewal Term of this Agreement, Licensor agrees to provide and Licensee agrees to accept the maintenance and support services with respect to the most current version of the Licensed Software and Databases as set forth in this Section 8. The fees for such maintenance and support services are set forth on Schedules C and D ----------- - attached hereto. 8.2 Updates. Licensor will make reasonable efforts to correct any material errors in the most current version of the Licensed Software and Databases from time to time and shall provide Licensee with copies of all Updates and Database Updates as they are released and made generally available by Licensor to its customers from time to time; provided that Licensor shall use its best efforts to provide the Database Updates to Licensee every two (2) months. All Updates and Database Updates shall be owned by Licensor and shall be subject to the terms and conditions of this Agreement. 8.3 Upgrades. Subject to the provisions of Section 2.4, Licensor agrees to provide Licensee with copies of all Upgrades as they are released and made generally available by Licensor to its customers from time to time. All Upgrades shall be owned by Licensor and shall be subject to the terms and conditions of this Agreement. 8.4 Negation of MSP and Express Warranties. Licensee understands and acknowledges that the Licensed Software and the Databases will become dated and will be automatically rendered inoperable if Licensee fails to install any Licensed Software or Database within thirty (30) days of its receipt of same from Licensor. If Licensee so fails to install any Licensed Software or Database, all obligations of Licensor as to the MSP and all warranties of Licensor under Section 12.1 shall terminate and be null and void and of no further force and effect. CSF PW - --- -- Licensee Licensor 9 8.5 Telephone Support. Licensor shall provide telephone support to Licensee out of its service office in Boulder, Colorado on Monday through Friday (holidays excluded) between the Hours of 8:00 a.m. and 5:00 p.m., Mountain Standard Time, with respect to questions regarding the use of the most current version of the Licensed Products. Hours of service are subject to change at any time by Licensor without notice. This telephone support shall be available to Licensee at no cost beyond the fees set forth on Schedules C and D attached ----------- - hereto, provided the frequency and length of calls are reasonable. 8.6 Costs of Excluded Items. If it is determined by Licensor that any apparent problem with the Licensed Products that is reported to Licensor by Licensee is due to the acts or omissions of Licensee or its employees, hardware problems, use of unqualified personnel, user error, alteration of the Licensed Products by Licensee or any third party, the use of an out-of-date version of the Licensed Products, or failure to comply with the terms and conditions of this Agreement, Licensor shall notify Licensee and such time and expenses associated with such support effort shall be billed by Licensor at its then- current hourly rates and paid by Licensee within thirty (30) days of its receipt of the invoice therefor. 8.7 On-Site Services. Licensor shall have no obligation to provide any services at Licensee's site. 8.8 Hardware Maintenance. Licensor shall have no obligation to provide maintenance or repair for any hardware or associated operated system. Hardware maintenance shall be the sole responsibility of Licensee. 8.9 No Additional Services. Licensor is under no obligation to provide any additional services and any agreements for same will be separate from and in addition to this Agreement at Licensor's then-current hourly rates plus expenses. 9. REPRODUCTION OF LICENSED PRODUCTS. --------------------------------- 9.1 Licensed Software and Databases. The Licensed Software and the Databases may not be copied or duplicated by Licensee, in whole or in part, except that Licensee may copy the Licensed Software and the Databases solely for use on the Designated CPU or for necessary security back-up purposes. The original and all copies of the Licensed Software and the Databases, in whole or in part, which are made or used by or in the possession of Licensee shall be and shall remain the property of Licensor and shall be kept by Licensee at the location of the Equipment in which they are first installed as set forth on Schedule B attached hereto. - ---------- 9.2 Documentation. In no event may Licensee copy or duplicate, or transmit via any medium, in whole or in part, the Documentation, but additional copies of the Documentation will CSF PW - --- -- Licensee Licensor 10 be made available to Licensee upon request at a nominal fee for copying and shipping and Handling. 10. MODIFICATION OF LICENSED SOFTWARE AND DATABASES. ----------------------------------------------- 10.1 No Modification by Licensee. Licensee shall not alter, modify, change, decompile, disassemble or reverse engineer the Licensed Software or any Database. 10.2 Merger of Licensed Software. Licensee may, at its expense, merge the Licensed Software into other software programs to form an updated work for the Licensed Use, provided such resulting merged software shall be subject to all of the terms and conditions of this Agreement. 11. PROTECTION OF TRADE SECRETS. --------------------------- 11.1 Licensed Products. Licensee agrees that the Licensed Products and all associated patents, copyrights, trademarks, trade names, trade secrets and other intellectual property rights are the exclusive property, and constitute a valuable trade secret, of Licensor. Licensee agrees not to seek to discover or to disclose any of Licensor's trade secrets by disassembling, decompiling or otherwise reverse engineering the Licensed Software or Databases. Licensee shall not disclose, disseminate, transmit via any medium whatsoever, or make available the Licensed Products, or any portion thereof, to third parties without Licensor's prior written consent. 11.2 Source Code. The source code for the Licensed Software shall not be disclosed or made available to Licensee. Licensee shall not create, derive or discover, or attempt to create, derive or discover, by reverse compiling, reverse engineering, reverse assembling or otherwise, the source code for the Licensed Software or any part thereof from the object code format or from other information made available to Licensee under this Agreement or otherwise. 12. LIMITED WARRANTY AND DISCLAIMER. ------------------------------- 12.1 Limited Warranty. Licensor warrants that, for a period of ninety (90) days from the date of shipment of any Licensed Software or Database to Licensee (the "Warranty Period"), such Licensed Software or Database, as the case may be, will perform substantially according to its product description as specified in the Documentation under normal use and that the diskettes and/or CD ROMs on which the Licensed Software and Databases furnished to Licensee are recorded will be free from defects in materials and workmanship. The foregoing warranty shall be null and void and of no force and effect if the Licensed Software or Database fails to perform as a result of accident, neglect or misuse, user error, electrical power damage, or in the event that all or any part of the Licensed Software or Database is installed improperly or on any computer CSF PW - --- -- Licensee Licensor 11 equipment other than the Designated CPU or used with any operating system for which the Licensed Software or Database is not designed, or if the Licensed Software or Database is altered or modified or is incorrectly merged with other software by Licensee or any third party. 12.2 Sole and Exclusive Remedy. Licensee acknowledges that Licensor's sole obligation and liability and Licensee's sole and exclusive remedy for a breach of the express warranty under Section 12.1 shall be the replacement or repair of any Licensed Software or Database and/or diskette(s) and/or CD ROM(S) not meeting Licensor's limited warranty, provided that Licensor receives, during the applicable Warranty Period, written notice of a defect or other problem and Licensee thereafter promptly returns the Licensed Products to Licensor for replacement or repair. If Licensor is unable to deliver such a replacement or make such repair within a reasonable period of time thereafter (which in no event shall be less than sixty (60) days after its receipt of the Licensed Products), Licensee may terminate this Agreement by returning the Licensed Products to Licensor, and Licensor shall thereafter refund to Licensee that portion of the Initial License Fee or the Renewal License Fee, as the case may be, paid by Licensee which is attributable to the remaining portion of the Initial Term or the Renewal Term, as the case may be (commencing with the date of Licensor's receipt of the Licensed Products as described in the preceding sentence) as full payment of all obligations of Licensor pursuant to this Agreement. 12.3 Warranty Disclaimer. THE FOREGOING LIMITED WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES AND CONDITIONS, EXPRESS OR IMPLIED, AND CONSTITUTES THE SOLE AND EXCLUSIVE WARRANTY OF LICENSOR WITH RESPECT TO THE LICENSED PRODUCTS. EXCEPT FOR THE EXPRESS LIMITED WARRANTY SET FORTH IN SECTION 12.1, LICENSOR SPECIFICALLY DISCLAIMS, AND LICENSEE RELEASES AND WAIVES, ALL WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR USE AND PURPOSE OR ANY WARRANTY ARISING UNDER STATUTE OR OTHERWISE IN LAW OR FROM A COURSE OF DEALING, COURSE OF PERFORMANCE OR USAGE OF TRADE. Without limiting the generality of the foregoing, Licensor does not warrant that the Licensed Software or any Database is accurate or will meet Licensee's requirements, will operate in any combination that may be selected for use by Licensee or in combination with other software, or will operate uninterrupted or error free. Furthermore, Licensor does not warrant that all software errors, defects or inefficiencies will be corrected, nor does Licensor assume any liability for failure to correct any such error, defect or inefficiency. Licensor makes no warranty, and Licensee assumes the entire risk, as to the integrity of any data and the results, capabilities, suitability, use or performance of the Licensed Products. IN NO EVENT SHALL LICENSOR BE LIABLE TO LICENSEE FOR ANY DAMAGES RESULTING FROM OR RELATED TO THE USE OR PERFORMANCE OF THE LICENSED PRODUCTS. CSF PW - --- -- Licensee Licensor 12 13. LIMITATION OF LIABILITY. ----------------------- IT IS UNDERSTOOD AND AGREED THAT LICENSOR'S TOTAL LIABILITY UNDER THIS AGREEMENT, IF ANY, FOR ANY DAMAGES SUFFERED BY LICENSEE, ANY PARTY CLAIMING ON BEHALF OF OR THROUGH LICENSEE, OR ANY OTHER THIRD PARTY, WHETHER IN CONTRACT, IN TORT, UNDER ANY WARRANTY THEORY, IN NEGLIGENCE, OR OTHERWISE, SHALL BE LIMITED TO DIRECT DAMAGES AND SHALL NOT EXCEED THE AMOUNT OF FEES PAID TO LICENSOR BY LICENSEE PURSUANT TO THIS AGREEMENT FOR THE LICENSED PRODUCTS FOR THE SIX (6) MONTHS IMMEDIATELY PRECEDING THE OCCURRENCE GIVING RISE TO ANY SUCH CLAIM. THE LICENSE FEE CHARGED HEREIN IS A CONSIDERATION IN LIMITING LICENSOR'S LIABILITY HEREUNDER. LICENSEE UNDERSTANDS THAT UNDER NO CIRCUMSTANCES SHALL LICENSOR BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES SUFFERED BY LICENSEE, ANY PARTY CLAIMING ON BEHALF OF OR THROUGH LICENSEE, OR ANY OTHER THIRD PARTY RESULTING FROM OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE PERFORMANCE OR BREACH THEREOF, INCLUDING LOSS OF BUSINESS OR PROFITS, BUSINESS INTERRUPTION, OR DAMAGE OR DESTRUCTION OF DATA, EVEN IF LICENSOR HAS BEEN PREVIOUSLY ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. NO ACTION, REGARDLESS OF FORM OR BASIS, ARISING OUT OF THE TRANSACTIONS UNDER THIS AGREEMENT MAY BE BROUGHT BY LICENSEE MORE THAN ONE (1) YEAR AFTER LICENSEE KNEW OR SHOULD HAVE KNOWN OF THE OCCURRENCE OF THE EVENT(S) WHICH GAVE RISE TO SUCH ACTION. 14. PATENT, COPYRIGHT AND TRADE SECRET INDEMNITY. -------------------------------------------- 14.1 Right to License. Licensor represents and warrants that it is the owner of the Licensed Products (except as disclosed in Section 5.2 as to any third party data files) and that it has the right and authority to grant the License hereunder with respect to the Licensed Products. 14.2 Notification to Licensor. In the event Licensee has any knowledge of any infringement of, litigation instituted with respect to, or challenge to, the Licensed Products by any Person, Licensee shall immediately notify Licensor. Additionally, in such event, Licensee shall immediately furnish to Licensor copies of all correspondence, notices, advertising, complaints, legal documents, and other written materials relating to any such infringement, litigation or challenge which it may have in its possession. 14.3 Investigation, Defense and Indemnification. Licensor agrees to investigate promptly and defend Licensee against any claim, demand, suit or action brought against Licensee based on any claim that the use by Licensee of the then-current version of the Licensed Products delivered by Licensor to Licensee infringes any existing United States patent, copyright or trade secret of any third party, provided Licensee (i) provides timely notice of any such claim, CSF PW - --- -- Licensee Licensor 13 demand, suit or action to Licensor, (ii) is not using the Licensed Products in an unauthorized manner, and (iii) agrees to cooperate fully with Licensor and to execute any and all documents and take any and all action deemed necessary or advisable by Licensor to protect the Licensed Products and Licensor's interests therein. If all of the conditions in (i)-(iii) are met, Licensor agrees to assume the defense of such claim, demand, suit or action, with counsel of Licensor's choice, and indemnify and hold harmless Licensee from and against any and all damages and costs (including reasonable attorneys' fees) finally awarded by a court against Licensee as a result of any such claim, demand, suit or action; provided that Licensor's obligation to pay damages and costs shall not exceed the total sum specifically set forth in Section 13, and provided further that Licensor will not be responsible for any damages or costs under any compromise made by Licensee without Licensor's written consent. In the event Licensor decides to assume the defense of any such claim, demand, suit or action and so indemnify Licensee, Licensee shall be bound by the terms of any settlement agreement entered into by Licensor. 14.4 Non-infringing Use. If, in Licensor's opinion, any of the Licensed Products are likely to become the subject of a claim for infringement or if, as a result of any such claim, demand, suit or action, Licensee is enjoined from using any of the Licensed Products, Licensor may, at its own expense and at its option, (i) procure for Licensee the right to continue using such Licensed Product, (ii) replace the same with non-infringing software of equivalent function or performance, or (iii) modify such Licensed Product so that it becomes non-infringing. If none of these options is reasonably practical, Licensor may terminate this Agreement, whereupon Licensor shall refund to Licensee that portion of the Initial License Fee or Renewal License Fee, as the case may be, paid by Licensee which is attributable to the remaining portion of the Initial Term or the Renewal Term, as the case may be, as full payment of all obligations of Licensor pursuant to this Agreement. 14.5 No Further Indemnity. Licensor shall have no obligation with respect to any such infringement claim based upon Licensee's modification of the Licensed Products or their combination, merger, operation or use with equipment, data, software or other items not furnished by Licensor, provided such infringement would have been avoided but for such combination or merger. EXCEPT AS SPECIFICALLY PROVIDED IN THIS SECTION 14, LICENSOR SHALL HAVE NO LIABILITY TO LICENSEE FOR THE INFRINGEMENT OF ANY PATENTS, COPYRIGHTS, TRADE SECRETS OR OTHER PROPRIETARY RIGHTS BY THE LICENSED PRODUCTS OR ANY PORTION THEREOF. 15. LICENSEE INDEMNIFICATION. ------------------------ Licensee hereby agrees to indemnify and hold harmless Licensor, its officers, directors, shareholders, employees, agents, insurers, attorneys, successors, and assigns from and against any and all Losses resulting directly or indirectly from (i) any and all acts and omissions of Licensee, its employees, or agents with respect to the Licensed Products, including, without limitation, Licensee's negligent or intentional misrepresentation of Licensor or the Licensed Products, the use, operation or possession of the Licensed Products by Licensee, or any breach of any term or provision of this Agreement by Licensee, and (ii) any claim, demand, suit or action CSF PW - --- -- Licensee Licensor 14 brought against Licensor that Licensee's use of its software programs infringes the intellectual property of a third party. 16. CONFIDENTIAL INFORMATION; NON-SOLICITATION. ------------------------------------------ 16.1 Confidential Information. Licensee acknowledges and agrees that the Licensed Products are protected by the law of copyright, are very valuable, special and unique assets of Licensor, and contain trade secrets and proprietary information, and that Licensor has a proprietary interest in such Licensed Products and all ideas, trade secrets, procedures, processes, methods, systems, techniques, algorithms and concepts contained therein or related thereto, whether disclosed orally or in writing or by any other media (collectively, the "Confidential Information"), and such Confidential Information shall remain the sole and exclusive property of Licensor. In performance of its duties hereunder, Licensor will also be receiving information deemed confidential by Licensee (also, "Confidential Information"). The party receiving any such Confidential Information (the "Receiving Party") shall hold such Confidential Information in strictest confidence, for the exclusive use of the Receiving Party, and the Receiving Party will not take any action in derogation of such confidentiality and agrees that its use and disclosure of the Confidential Information must be continuously controlled. The Receiving Party shall take all reasonable steps to insure that the Confidential Information is not used by or made available or furnished or disclosed to any Person (other than the Receiving Party's employees directly concerned with the Licensed Use and who need such disclosure for the conduct of their ordinary responsibilities), including, but not limited to, taking all steps it takes to protect information, data or other tangible and intangible property of its own that it regards as proprietary or confidential. The Receiving Party shall instruct its employees and agents having access to the Confidential Information regarding the terms and limitations contained in this Section 16. 16.2 Non-Confidential Information. Information shall not be deemed "Confidential Information" which: 16.2.1 is or has become publicly known as of the date of receipt by the Receiving Party other than through disclosure by the Receiving Party; or 16.2.2 is already in the possession of, or actually and demonstrably is known to, the Receiving Party at the time of disclosure; or 16.2.3 is approved for public release by written authorization from the party disclosing any Confidential Information. 16.3 Non-Solicitation; Non-Competition. In consideration of Licensor's transmittal of the Confidential Information to Licensee, Licensee agrees that, during the term of this Agreement and for a period of two (2) years thereafter, neither it nor any of its Affiliates: CSF PW - --- -- Licensee Licensor 15 16.3.1 shall, directly or indirectly, solicit, hire or otherwise retain as an employee or independent contractor any present or former employee of or consultant to Licensor who was assigned to the development, marketing or maintenance of any part of the Licensed Products, nor solicit, encourage or request any such employee to leave the employ of Licensor; or 16.3.2 shall compete, directly or indirectly, with Licensor in the creation, manufacture, sale, licensing, marketing or distribution of software programs and materials which are similar to or which compete with the Licensed Products within the geographic areas in which the Licensed Products are then offered for sale or license; provided, however, that this provision shall not prohibit Licensee from developing a software program for internal business purposes only. 16.4 Specific Performance. Each party specifically agrees that any breach of this Section 16 will result in irreparable injury to the other party and the other party shall be entitled (without the necessity of posting any bond or establishing the inadequacy of damages as a remedy) to specific performance and injunctive relief to correct and/or enjoin any such breach or threatened breach in addition to all other remedies which might be available. In the event any such action is brought by Licensor, the parties hereby agree that the United States District Court for the Middle District of Florida, Tampa Division shall have exclusive Jurisdiction to hear and determine any such action. In the event any such action is brought by Licensee. the parties hereby agree that the United States District Court for the County of San Diego shall not have exclusive jurisdiction to hear and determine any such action. Each party hereby expressly submits and consents in advance to such jurisdiction and venue in any such action and agrees that service of any summons and complaint, or other process or papers, may be made by registered or certified mail, return receipt requested, addressed to such party at the address to which notices are to be sent pursuant to Section 22.1 hereof. 16.5 Independent Covenants The covenants and agreements of the parties set forth in this Section 16 shall be construed as agreements independent of any other provision of any agreement, and the existence of any claim or cause of action, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement of the covenants and agreements contained herein. 17. TERMINATION OF AGREEMENT. ------------------------ 17.1 By Licensor or Licensee. This Agreement and the License and other rights granted hereunder may be terminated by Licensor or Licensee: 17.1.1 at the end of the Initial Term or any Renewal Term by giving the other party written notice of its intent not to renew no less than sixty (60) days prior to the expiration of the Initial Term or any Renewal Term, as the case may be; or CSF PW - --- -- Licensee Licensor 16 17.1.2 immediately where the other party (the "breaching party") breaches any term or provision of this Agreement (excluding any failure to make any payment hereunder, which shall be governed by Section 17.3. 1) and fails to cure such breach within thirty (30) days after written notice of such breach from the non-breaching party. 17.2 By Licensee Only. This Agreement and the License and other rights granted hereunder may be terminated by Licensee as set forth in the last sentence of Section 12.2. 17.3 By Licensor Only. This Agreement and the License and other rights granted hereunder may be terminated immediately by Licensor by written notice to Licensee: 17.3.1 where Licensee fails to make any payment hereunder when due, and fails to cure such breach within ten (10) days after the due date of payment; or 17.3.2 in the event (i) of an assignment by Licensee for the benefit of creditors; (ii) Licensee shall become insolvent, or shall be unable to pay its debts as they mature, or shall admit in writing its inability to pay its debts as they mature; (iii) of Licensee's dissolution or loss of charter by forfeiture; (iv) Licensee is adjudged bankrupt or insolvent by a United States court of competent jurisdiction; (v) a trustee or receiver is appointed for Licensee or its assets or any substantial part thereof, (vi) Licensee files a voluntary petition under any bankruptcy or other similar law providing for its reorganization, dissolution or liquidation, or any involuntary petition under any bankruptcy or other similar law is filed against Licensee; (vii) Licensee shall consent to the appointment of a receiver or a trustee for itself or its assets or of any substantial part thereof, or (viii) any substantial part of Licensee's property becomes subject to any levy, seizure, assignment, application, or sale for or by a creditor or government agency; or 17.3.3 in the event Licensee breaches any of the provisions of Sections 2.5, 10.1, 11 or 16; or 17.3.4 as set forth in Section 14.4. 18. EFFECT OF TERMINATION. --------------------- 18.1 Effect of Termination. Immediately upon any termination, cancellation or expiration of this Agreement or of any License granted hereunder for any reason: 18.1.1 all rights and Licenses granted to Licensee under this Agreement shall cease and terminate and Licensee shall have no right thereafter to use, and shall cease the use of, the Licensed Products or any portion thereof, CSF PW - --- -- Licensee Licensor 17 18.1.2 Licensee shall return the originals of the Licensed Products and all copies thereof, in whole or in part, to Licensor; 18.1.3 Licensee shall remove the Licensed Software and Databases and all portions thereof from any merged software, including as permitted pursuant to Section 10.2; 18.1.4 Licensee shall pay to Licensor any and all outstanding fees, charges, payments and expenses due pursuant to this Agreement; 18.1.5 Licensor shall have the right, at any time, to take possession of the Licensed Products and all copies thereof wherever located, without demand or notice; and 18.1.6 Licensor may cease performance of all of Licensor's obligations hereunder without liability to Licensee, including the MSP (which will cause the Licensed Software and the Databases to become dated and automatically rendered inoperable) and all express warranties contained under Section 12. 1. 18.2 Certification by Licensee. Within ten (10) days following the date of termination, cancellation or expiration of this Agreement, Licensee shall certify in writing to Licensor its compliance with the provisions of Section 18. 1. 18.3 Survival. The provisions of Sections 3.6, 5.1, 12, 13, 15, 16, 18.1, 18.2, 23.4 and 23.5 shall survive the termination, cancellation or expiration of this Agreement for any reason. 19. FORCE MAJEURE. ------------- Licensor shall not be liable to Licensee for any delay or failure by Licensor in the performance of its obligations under this Agreement or otherwise if such delay or failure arises from any cause or causes beyond the control of Licensor including, without limitation, labor shortages or disputes, strikes, other labor or industrial disturbances, delays in transportation, acts of God, floods, lightning, fire, epidemic, shortages of materials, rationing, utility or communication failures, earthquakes, casualty, war, acts of the public enemy, an act of civil or military authority, sabotage, explosives, riots, insurrections, embargoes, blockades, actions, restrictions, regulations or orders of any government, agency or subdivision thereof, or failure of suppliers. CSF PW - --- -- Licensee Licensor 18 20. EXPORT REGULATIONS; U.S. GOVERNMENT RESTRICTIONS. ------------------------------------------------ 20.1 Export Regulations. Licensee acknowledges that the Licensed Products and any direct products thereof may be subject to United States export laws, statutes and regulations, and that Licensee will at all times comply with the provisions of such laws, statutes and regulations including obtaining any necessary or required licenses. Licensee shall not export or re-export or otherwise transmit, directly or indirectly, the Licensed Products or any direct products thereof into, or use the Licensed Products or any direct products thereof in, any country prohibited or restricted under United States export laws, statutes or regulations or any other applicable laws. 20.2 U.S. Government Restrictions. The Licensed Products are provided with Restricted Rights. Use, duplication or disclosure by the United States Government is subject to restrictions as set for in subparagraph (c)(1)(ii) of The Rights in Technical Data and Computer Software clause at DFARS 252.227-7013 or subparagraphs (c)(1) and (2) of the Commercial Computer Software - Restricted Rights at 48 CFR 52.227, as applicable. 21. INDEPENDENT CONTRACTOR RELATIONSHIP. ----------------------------------- 21.1 Independent Contractors Only. The relationship of Licensor and Licensee is that of independent contractors, and nothing contained in this Agreement shall be construed to (i) give either party the power to direct and control the day-to-day activities of the other, (ii) constitute the parties as partners, joint venturers, co-owners or otherwise as participants in a joint or common undertaking, (iii) allow either party to act on behalf of or bind the other party or create or assume any obligation on behalf of the other party for any purpose whatsoever, or (iv) create any ownership interest in Licensee or any other Person as to the Licensed Products. All financial obligations associated with Licensee's business are the sole responsibility of Licensee. 22. COMMUNICATIONS. -------------- 22.1 Communications. Whether expressly so stated or not, all notices, demands, requests and other communications required or permitted by or provided for in this Agreement (collectively, "Communications") shall be given in writing to the parties at their respective addresses set forth above in the first sentence of this Agreement, or at such other address as a party shall designate for itself in writing in accordance with this Section 22. Communications may be transmitted (i) by personal delivery, (ii) by delivery by messenger, express or air courier, or similar courier, or (iii) by delivery by United States first class certified or registered mail, postage prepaid. Except as otherwise provided in this Agreement, delivery or service of any Communication shall be deemed effective only upon receipt; provided, any Communication received after 5:00 p.m. local time of place of receipt, or on a day other than a Business Day, shall be deemed received on the next succeeding Business Day. CSF PW - --- -- Licensee Licensor 19 22.2 Change of Address. Each party agrees to provide the other party at least ten (10) days advance notice of any change in its principal business location. In addition, Licensee agrees to provide Licensor at least ten (10) days advance notice of any change in the location of Designated CPU. 3. MISCELLANEOUS PROVISIONS. ------------------------ 23.1 Entire Agreement. This Agreement, including all of the Schedules referenced herein and attached hereto, constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof, and supersedes, supplants, and renders null and void any and all prior and contemporaneous negotiations, discussions, proposals, agreements, understandings, representations or communications, oral or written, of the parties hereto with respect to the subject matter hereof 23.2 Binding Effect. This Agreement shall be binding upon, inure to the benefit of, and be enforceable by the parties hereto and their respective successors and permitted assigns. 23.3 Amendment. This Agreement may be amended only by a writing duly executed by the authorized representatives of the parties hereto which makes specific reference to this Agreement. 3.4 Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Florida, without regard to the choice of law provisions of that State. 3.5 Arbitration of Disputes. Except as otherwise expressly provided herein, all claims, disputes and other matters in question arising out of or relating to this Agreement, including the breach or interpretation hereof (collectively, "Disputes"), shall be resolved by arbitration in Tampa, Florida (if initiated by Licensor) or San Diego, California (if initiated by Licensee) by a panel of three (3) arbitrators. Either party may initiate arbitration by giving the other party written notice containing a brief description of the Dispute(s) to be arbitrated and the monetary amount involved. If the parties are unable to agree as to the settlement of the Dispute within ten (10) days of such written notice, then, within twenty (20) days of such written notice, each party shall select an arbitrator and the two arbitrators selected by the parties shall select a third arbitrator. Any arbitrator selected hereunder shall be a commercial person knowledgeable in data processing and the licensing of computer software. No person shall serve as an arbitrator who has, or has had, any expectation of acquiring any business or financial relationship with either of the parties hereto or who has acquired from either party or any other source detailed prior knowledge of the matter in dispute. A decision by a majority of the panel of arbitrators, when reduced to writing and signed by the arbitrators, shall be final and binding upon the parties and judgment thereon may be entered by any court of competent jurisdiction. Any award of the panel of arbitrators shall include an award of reasonable attorneys' fees and costs and interest for CSF PW - --- -- Licensee Licensor 20 such period as shall fully compensate the party in whose favor the award is entered for the loss of use of the funds in question. The parties shall use their best efforts to assure that all arbitration proceedings shall be held and conducted so that the panel's award shall be rendered in writing within sixty (60) days after the arbitration has been initiated. Any arbitration under this Agreement shall be subject to and conducted in accordance with the rules and procedures of the American Arbitration Association for commercial arbitration in effect at the time arbitration is initiated. 23.6 Assignment. Neither party may assign or transfer its rights or obligations under this Agreement except with the express written consent of the other party; provided, however, that a successor in interest by merger, by operation of law, purchase or otherwise of the entire business of either party shall acquire all rights and obligations of such party hereunder without the necessity of obtaining prior written consent. Any assignment without such consent shall be null and void and of no force and effect. 23.7 Waiver. No party to this Agreement shall be deemed to have waived any of its rights, powers or remedies under this Agreement unless such waiver is expressly set forth in a writing signed by the waiving party. No written waiver of any provision of this Agreement shall be deemed to be, or shall constitute, (i) a waiver of any other provision of this Agreement, whether or not similar, or (ii) a continuing or subsequent waiver of the same or another provision of this Agreement. The failure of either party to enforce at any time any of the provisions of this Agreement, or the failure to require at any time performance by the other party of any of the provisions of this Agreement, will in no way be construed to be a present or future waiver of any such provisions, or in any way affect the validity of either party to enforce each and every such provision thereafter. 23.8 Captions. The captions and headings of Sections and subsections contained in this Agreement are provided for convenience of reference only and shall not be considered a part hereof for purposes of interpreting this Agreement, and, therefore, such captions and headings do not define, modify, limit, describe or affect in any way the meaning or intent of this Agreement or any of its terms or provisions. 23.9 Gender, Etc. Whenever the context shall require, the use of the masculine gender herein shall be deemed to include the feminine gender and the neuter gender, and the use of the singular or the plural herein shall be deemed to include the plural or the singular, as the case may be. 23.10 Severability. If any Section or other provision of this Agreement, or the application of such Section or provision, is held invalid, then the remainder of this Agreement, and the application of such Section or provision to persons or circumstances other than those with respect to which it is held invalid, shall not in any way be affected or impaired thereby. In the event that any provision of this Agreement becomes or is declared by a court of competent jurisdiction or panel of arbitrators to be illegal, unenforceable or void, this Agreement shall CSF PW - --- -- Licensee Licensor 21 continue in full force and effect without said provision. The parties agree to negotiate in good faith a substitute valid and enforceable provision that most nearly effects the parties' intent and to be bound by the mutually agreed substitute provision. Notwithstanding anything to the contrary contained herein, if any of the provisions of Section 16 are found to be invalid, then the parties hereto agree to enter into such other agreement as will validly afford, to the greatest extent possible, the protection intended by that Section. 23.11 Parties in Interest. Nothing in this Agreement, express or implied, is intended to confer any rights, benefits or remedies under or by reason of this Agreement on any Person other than the parties to it and their respective successors and permitted assigns, nor is anything in this Agreement intended to relieve or discharge any obligation of any third Person to any party hereto or give any third Person any right to subrogation or action over or against any party to this Agreement. 23.12 No Presumption. In the event of any uncertainty in the terms of this Agreement, there shall exist no presumption against either party that such uncertainty arose from the preparation of this Agreement by such party. 23.13 Any Inconsistencies. To the extent there is any inconsistency between this Agreement, on the one hand, and any purchase order or other document issued in connection with this Agreement, on the other hand, this Agreement shall control over any inconsistency appearing in any purchase order or other document issued in connection with this Agreement. 23.14 Counterparts. This Agreement may be executed in any number of counterparts, each of which so executed shall be deemed to be an original and all of which together shall constitute one and the same instrument, and in making proof hereof it shall not be necessary to produce or account for more than one such counterpart. 23.15 Attorneys' Fees and Costs of Enforcement. The parties hereto agree that should it become necessary for any party hereto to employ an attorney to enforce any of its rights hereunder against any other party hereto, the prevailing party shall be entitled, in addition to any other rights and remedies it may have, to reimbursement from the non-prevailing party of all costs and expenses, including reasonable attorneys' fees, costs of arbitration and court costs. 23.16 Computation of Time. Except as is otherwise expressly provided in this Agreement, all periods of time shall be computed by including Saturdays, Sundays and holidays. 23.17 Approval of Licensor. Whenever this Agreement requires or provides for any approval, acceptance, waiver or consent by Licensor, such approval, acceptance, waiver or consent must in every case be in writing. CSF PW - --- -- Licensee Licensor 22 23.18 Further Assurances. Each party agrees to execute and deliver any and all papers, documents and instruments or take such further actions as the other party may reasonably require to carry out the terms of this Agreement. 23.19 Remedies. All remedies shall be cumulative and not alternative and in addition to all other rights and remedies available in law and in equity. 23.20 Recitals. The parties hereby agree that each and all of the Recitals set forth herein are true and correct and are incorporated by this reference and made a part of this Agreement for all purposes. 23.21 Other Rules of Construction. For purposes of this Agreement, the following rules of construction shall also apply, whether expressly so stated or not: 23.21.l All of the Schedules referred to in this Agreement shall be deemed incorporated into this Agreement by this reference and made a part of this Agreement for all purposes as if fully set forth in this Agreement. 23.21.2 References in this Agreement to Sections and Schedules are references to Sections of and Schedules attached to this Agreement, except as expressly otherwise indicated. 23.21.3 Any phrase containing the term "include" or "including" shall mean including without limitation. 23.21.4 Unless the context requires otherwise, the words "herein," "hereof," "hereunder," and other words of similar import refer to this Agreement as a whole and not to any particular section, subsection or clause. 23.21.5 Unless the context requires otherwise, any reference to a statute shall include and shall be deemed to be a reference to such statute, or any successor statute to such statute, and to the regulations promulgated thereunder, with all amendments made thereto and in force from time to time. CSF PW - --- -- Licensee Licensor 23 IN WITNESS WHEREOF, Licensor and Licensee have executed this Agreement as of the Effective Date. COMPS INFOSYSTEMS, INC. QUALITATIVE MARKETING SOFTWARE, INC. By: /s/ Craig Farrington By: /s/ Paul Wray ------------------------------ ---------------------------- Print Name: Craig Farrington Print Name: Paul Wray ---------------------- Title: V.P. Marketing Title: President --------------------------- "Licensee" "Licensor" CSF PW - --- -- Licensee Licensor 24 SCHEDULE A ---------- Licensed Software, Documentation, Databases, and ------------------------------------------------ Restrictions on Use ------------------- A. Licensed Software GeoStan(TM) [Library]* -- Non-CASS StarData(TM) -- Non-CASS CENTRUS(TM) ACM demo -- 100 record limit *Licensee may replace the GeoStan [Library] with the GeoStan [OCX] when the OCX is available. B. Documentation GeoStan(TM) Reference Manual StarData(TM) User Guide CENTRUS User Guide C. Databases a. Qualitative Marketing Software's GeoStan(TM) Address Standardization and Business Location Research (BLR) Geocoding database files (called GSDS) and required support files for the United States. ------------- b. Qualitative Marketing Software's BLR ZIP+4 Centroid File(s) (called Z9s), or its suitable replacement, which Licensor has license to resell and distribute, for the United States. ------------- D. Restrictions on Use Licensee agrees that the Licensed Products: (1) shall not be CASS certified for address standardization; (2) shall not be transmitted on the Internet; and (3) shall only process a maximum of 500,000 records annually. CSF PW - --- -- Licensee Licensor 25 SCHEDULE B ---------- Designated CPS and Users ------------------------ The Licensed Software and Databases are licensed to Licensee for the following Designated CPS and users: GeoStan(TM), StarData(TM), and CENTRUS(TM) ACM (demo) - ----------------------------------------------------- Designated CPU Manufacturer: PC Operating System: Windows(R) NT Location: 9888 Carroll Centre Rd. Suite 100 San Diego, CA 92126-4580 Sites 1 Users 10 CSF PW - --- -- Licensee Licensor 26 SCHEDULE C ---------- Initial License Fee ------------------- Software GeoStan [Library] $10,000.00 StarData No charge CENTRUS No Charge Geocoding Database licensed directly from BLR USPS Database $ 3,000.00 MSP $ 1,500.00 Total Initial License Fee for Licensed Products and MSP $14,500.00* Terms $4,853.00 plus applicable sales tax and shipping ($60.00) due at offices of Licensor on the Effective Date; $4,853.00 plus applicable sales tax due at offices of Licensor on or before march 20, 1997; and $4,794.00 plus applicable sales tax due at offices of Licensor on or before April 21, 1997. CSF PW - --- -- Licensee Licensor 27 SCHEDULE D ---------- Renewal License Fee ------------------- Geocoding Database licensed directly from BLR USPS Database $3,000.00 MSP $1,500.00 Total Renewal License Fee for $4,500.00* Licensed Products and MSP Terms Payment due at offices of Licensor on the Renewal Date (optional - QMS Geocoding $2,000.00 database**) *Does not include shipping or applicable sales tax. **In the event Licensee elects to License the QMS Geocoding database, payment of $6,500.00* shall be due at offices of Licensor as set forth above under "Terms". CSF PW - --- -- Licensee Licensor 28 EX-10.25 30 LICENSE & SUBSCRIPTION AGMT DATED 12/17/92 TRANSAMERICA INFORMATION MANAGEMENT SERVICES EXHIBIT 10.25 METROSCAN 1860 Howe Avenue, #455 Sacramento, CA 95825 (916) 921-6629 (800) 866-2783 (916) 921-6781 (FAX) PAGE 1 of 4 ----- ----- LICENSE AND SUBSCRIPTION AGREEMENT ---------------------------------- Subject to the terms and conditions on the reverse side, Transamerica Information Management Services ("TIMS") hereby grants a limited non-exclusive, non-transferable license to use the METROSCAN(TM) CD-ROM databases for the localities identified below, together with the METROSCAN(TM) Software and associated manuals and other printed material ("documentation") provided with this package (hereinafter referred to collectively as "METROSCAN(TM)") to the following person (hereinafter referred to as the "Licensee"): LICENSE (SOLD TO) (BILL TO) Name COMPS Name S A M E -------------------------------- ------------------------------- Company COMPS Company____________________________ ----------------------------- Address 5414 Oberlin Drive #300 Address____________________________ ----------------------------- City San Diego State CA Zip 92121 City______ State ____ Zip ________ ----------- ---- ----- Phone 457-2274 FAX: 597-4886 Phone __________ FAX: ________ ---------- --------- BUSINESS TYPE: Com. R.E. Info ---------------------- Subject to the terms and conditions on the reverse side, TIMS agrees to provide the licensee with METROSCAN(TM) for the following localities, and to update those databases on a monthly basis.: MidMonth Updates Where Avail. ---- San Diego COUNTY DATA/MAPS/BOTH _____ X _____ = 1295.00 - --------------------------- ---- ------- ---- ---- Los Angeles (A-B-C) COUNTY DATA/MAPS/BOTH _____ X _____ = 2250.00 - --------------------------- ---- ---- ------- ---- Orange COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ---- Riverside COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ---- San Bernadino COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ___________________________ NETWORKING FEES (IF APPLICABLE) = _______ CD-ROM DRIVE REQUIREMENT: = _______ HARDWARE/SOFTWARE: = _______
Diskette Type: [ ] 5 1/4" [ X ] 3 1/2 - ----------------------------------------- SPECIAL INSTRUCTIONS - ----------------------------------------- Invoice for full amt on page #4 - ---------------------------------- __________________________________ __________________________________ __________________________________ __________________________________ __________________________________ - ----------------------------------------- PAYMENT TERMS: All invoices are due and payable upon receipt. Unpaid invoices are subject to late charges. MetroScan(TM) shipments will be suspended on past- due accounts. Term of the agreement shall be for 12 months commencing 12/1 1992 to 12/1 1993 -- ---- ---- ---- ---- and is non-cancelable for that period; except that TIMS may terminate this Agreement at any time for non payment of the license fee or if Licensee fails to comply with any provision of this Agreement. This Agreement shall automatically renew annually unless written notice of cancellation is given by either party 60 days prior to the expiration date of each term. _______ My check the amount of $_________________ is enclosed. _______ Please charge my _____ VISA _____ MASTERCARD Card Number: ____________ Expiration Date: __________ EQUIPMENT REQUIREMENTS: IBM-PC/XT/AT, 386, PS/2 or compatible with 640K of RAM Computer Model:_____________________ Microsoft DOS___________ Amount of Memory:___________________ Hard Disk (must have 2 mb of free space per county) DOS Version:________________________ Available expansion slot Amount of Free Space on Hard Disk___ Maps require VGA or EGA monitor & card Monitor/Graphics Card:______________
WARNING! I HAVE BEEN INFORMED THAT I SHOULD BACK UP MY HARD DISK PRIOR TO THE INSTALLATION OF THE METROSCAN(TM) CD-ROM DRIVE INTERFACE CARD. I HOLD TIMS HARMLESS FOR THE INSTALLATION. Licensee's Initials: _______________ TERMS AND CONDITIONS -------------------- CAREFULLY READ THE FOLLOWING TERMS AND CONDITIONS BEFORE YOU ENTER THIS LICENSE AGREEMENT. YOUR SIGNATURE BELOW CONSTITUTES YOUR ACCEPTANCE OF THESE TERMS AND CONDITIONS. OWNERSHIP OF METROSCAN(TM) MetroScan(TM) shall remain the property of Transamerica Information Management Services (TIMS) at all times and shall be surrendered to TIMS at the licensee's expense at such time as the License and Subscription Agreement shall be terminated. TIMS reserve the right to request that Licensee return all CD-ROM's, monthly updates, and documentation within 10 days of receipt of each new month's updates. PROHIBITED USES/YOU MAY: . Use MetroScan(TM) on any compatible computer, provided you use it only one computer at a time. . Use MetroScan(TM) on a network, file server or virtual disk, provided that access is limited to one user at a time and that you have the original copy of the documentation and the program disks. If MetroScan is used by multiple- users on a network, then each network node will bear a surcharge for MetroScan's network pricing schedule. TIMS is not responsible for the functionality or performance of the network operating system or software. PROHIBITED USES/YOU MAY NOT --- . Make copies of the documentation or program disks, except as described in the documentation. . Loan, rent, sub-license, or otherwise transfer the software or the documentation, except as provided above. . Alter, modify or adapt the software or documentation, including, but not limited to, translating, decompiling, disassembling or creating derivative works. Licensee if not permitted to download more than 5,000 data records without explicit written permission from licensor. THIS LICENSE AND YOUR RIGHT TO USE THE SOFTWARE AUTOMATICALLY TERMINATE IF YOU FAIL TO COMPLY WITH ANY PROVISION OF THIS LICENSE AGREEMENT. UPON TERMINATION, YOU WILL IMMEDIATELY RETURN ALL DOCUMENTATION AND DISKS. LIMITED WARRANTY LIMITED WARRANTY TIMS warrants that MetroScan(TM) will substantially conform to published specifications and to the documentation, provided that it is used on the computer hardware and with the operating system for which it was designed. TIMS also warrants that the magnetic media on which the software is distributed and the documentation are free from defects in materials and workmanship. TIMS will replace defective media or documentation or correct substantial software errors at no charge, provided Licensee returns the item with dated proof of payment to TIMS within ten (10) days of the date of delivery. If TIMS is unable to replace defective media or documentation or to correct substantial software errors, TIMS will refund the license fee. These are the Licensee's sole remedies for any breach of warranty. DISCLAIMER (1) EXCEPT AS SPECIFICALLY PROVIDED ABOVE, TIMS MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THIS SOFTWARE OR DOCUMENTATION, INCLUDING THEIR QUALITY, PERFORMANCE, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL TIMS BE LIABLE FOR DIRECT, INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OF OR INABILITY TO USE METROSCAN(TM) (AND/OR ASSOCIATED SOFTWARE OR DOCUMENTATION), EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. In particular, TIMS is not responsible for any costs, including, but not limited to, those incurred as a result of lost profits or revenue, loss of MetroScan(TM), loss of data, the cost of recovering such software or data, the cost of substitute software, or claims by third parties. In no case shall TIMS' liability exceed the amount of the license fee. (2) The information contained in MetroScan(TM) has been compiled from public records. However, it does not represent the official records of the County Assessor. These records are for information purposes only. No liability is assumed by the County Assessor or TIMS for the accuracy or completeness of this information. The user is directed to the office of the County Assessor for official assessment records. (3) THE WARRANTY AND LIMITATIONS SET FORTH ABOVE ARE EXCLUSIVE AND IN LIEU OF ALL OTHERS, ORAL OR WRITTEN, EXPRESS OR IMPLIED. No TIMS dealer, distributor, agent, or employee is authorized to make any modification or addition to the Limited Warranty set forth above. (4) Some states do not allow the exclusion or limitation of implied warranties or limitations of liability for incidental or consequential damages, so the above limitations or exclusions may not apply to this License. NOTE: All orders are subject to approval by TIMS. SUBSCRIBER SEE PAGE 4 TRANSAMERICA INFORMATION MANAGEMENT ---------------------- REPRESENTATIVE ______________________ AUTHORIZED SIGNATURE DATE: ___________________________ DATE: ___________________________ /s/ Christopher A. Crane 12/17/92 APPROVED BY: /s/ James E. Gregg DATE: 12/17/92 ------------------------------ TRANSAMERICA INFORMATION MANAGEMENT SERVICES Supercedes all previous agreements METROSCAN 1860 Howe Avenue, #455 Sacramento, CA 95825 (916) 921-6629 (800) 866-2783 (916) 921-6781 (FAX) PAGE 2 of 4 ----- ----- LICENSE AND SUBSCRIPTION AGREEMENT ---------------------------------- Subject to the terms and conditions on the reverse side, Transamerica Information Management Services ("TIMS") hereby grants a limited non-exclusive, non-transferable license to use the METROSCAN(TM) CD-ROM databases for the localities identified below, together with the METROSCAN(TM) Software and associated manuals and other printed material ("documentation") provided with this package (hereinafter referred to collectively as "METROSCAN(TM)") to the following person (hereinafter referred to as the "Licensee"): LICENSE (SOLD TO) (BILL TO) Name________________________________ Name_______________________________ Company COMPS Company____________________________ ----------------------------- Address_____________________________ Address____________________________ City___________ State ____ Zip _____ City_______ State ____ Zip ________ Phone__________ FAX:_________ Phone __________ FAX: ________ BUSINESS TYPE: ---------------------- Subject to the terms and conditions on the reverse side, TIMS agrees to provide the licensee with METROSCAN(TM) for the following localities, and to update those databases on a monthly basis.: (MidMonth Updates Where Avail.) ---- VENTURA COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ---- CLARK, NV COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ---- KING COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ---- SNOHOMISH COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ---- PIERCE COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ___________________________ NETWORKING FEES (IF APPLICABLE) = _______ CD-ROM DRIVE REQUIREMENT: = _______ HARDWARE/SOFTWARE: = _______
Diskette Type: [ ] 5 1/4" [ X ] 3 1/2 - ------------------------------------ SPECIAL INSTRUCTIONS - ------------------------------------ __________________________________ __________________________________ __________________________________ __________________________________ __________________________________ __________________________________ - ------------------------------------ PAYMENT TERMS: All invoices are due and payable upon receipt. Unpaid invoices are subject to late charges. MetroScan(TM) shipments will be suspended on past- due accounts. Term of the agreement shall be for 12 months commencing 12/1 1992 to 12/1 1993 -- ---- ---- ---- ---- and is non-cancelable for that period; except that TIMS may terminate this Agreement at any time for non payment of the license fee or if Licensee fails to comply with any provision of this Agreement. This Agreement shall automatically renew annually unless written notice of cancellation is given by either party 60 days prior to the expiration date of each term. _______ My check the amount of $_________________ is enclosed. _______ Please charge my _____ VISA _____ MASTERCARD Card Number: ____________ Expiration Date: __________ EQUIPMENT REQUIREMENTS: IBM-PC/XT/AT, 386, PS/2 or compatible with 640K of RAM Computer Model:_____________________ Microsoft DOS___________ Amount of Memory:___________________ Hard Disk (must have 2 mb of free space per county) DOS Version:________________________ Available expansion slot Amount of Free Space on Hard Disk___ Maps require VGA or EGA monitor & card Monitor/Graphics Card:______________
WARNING! I HAVE BEEN INFORMED THAT I SHOULD BACK UP MY HARD DISK PRIOR TO THE INSTALLATION OF THE METROSCAN(TM) CD-ROM DRIVE INTERFACE CARD. I HOLD TIMS HARMLESS FOR THE INSTALLATION. Licensee's Initials: _______________ TERMS AND CONDITIONS -------------------- CAREFULLY READ THE FOLLOWING TERMS AND CONDITIONS BEFORE YOU ENTER THIS LICENSE AGREEMENT. YOUR SIGNATURE BELOW CONSTITUTES YOUR ACCEPTANCE OF THESE TERMS AND CONDITIONS. OWNERSHIP OF METROSCAN(TM) MetroScan(TM) shall remain the property of Transamerica Information Management Services (TIMS) at all times and shall be surrendered to TIMS at the licensee's expense at such time as the License and Subscription Agreement shall be terminated. TIMS reserve the right to request that Licensee return all CD-ROM's, monthly updates, and documentation within 10 days of receipt of each new month's updates. PROHIBITED USES/YOU MAY: . Use MetroScan(TM) on any compatible computer, provided you use it only one computer at a time. . Use MetroScan(TM) on a network, file server or virtual disk, provided that access is limited to one user at a time and that you have the original copy of the documentation and the program disks. If MetroScan is used by multiple- users on a network, then each network node will bear a surcharge for MetroScan's network pricing schedule. TIMS is not responsible for the functionality or performance of the network operating system or software. PROHIBITED USES/YOU MAY NOT --- . Make copies of the documentation or program disks, except as described in the documentation. . Loan, rent, sub-license, or otherwise transfer the software or the documentation, except as provided above. . Alter, modify or adapt the software or documentation, including, but not limited to, translating, decompiling, disassembling or creating derivative works. Licensee if not permitted to download more than 5,000 data records without explicit written permission from licensor. THIS LICENSE AND YOUR RIGHT TO USE THE SOFTWARE AUTOMATICALLY TERMINATE IF YOU FAIL TO COMPLY WITH ANY PROVISION OF THIS LICENSE AGREEMENT. UPON TERMINATION, YOU WILL IMMEDIATELY RETURN ALL DOCUMENTATION AND DISKS. LIMITED WARRANTY LIMITED WARRANTY TIMS warrants that MetroScan(TM) will substantially conform to published specifications and to the documentation, provided that it is used on the computer hardware and with the operating system for which it was designed. TIMS also warrants that the magnetic media on which the software is distributed and the documentation are free from defects in materials and workmanship. TIMS will replace defective media or documentation or correct substantial software errors at no charge, provided Licensee returns the item with dated proof of payment to TIMS within ten (10) days of the date of delivery. If TIMS is unable to replace defective media or documentation or to correct substantial software errors, TIMS will refund the license fee. These are the Licensee's sole remedies for any breach of warranty. DISCLAIMER (1) EXCEPT AS SPECIFICALLY PROVIDED ABOVE, TIMS MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THIS SOFTWARE OR DOCUMENTATION, INCLUDING THEIR QUALITY, PERFORMANCE, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL TIMS BE LIABLE FOR DIRECT, INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OF OR INABILITY TO USE METROSCAN(TM) (AND/OR ASSOCIATED SOFTWARE OR DOCUMENTATION), EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. In particular, TIMS is not responsible for any costs, including, but not limited to, those incurred as a result of lost profits or revenue, loss of MetroScan(TM), loss of data, the cost of recovering such software or data, the cost of substitute software, or claims by third parties. In no case shall TIMS' liability exceed the amount of the license fee. (2) The information contained in MetroScan(TM) has been compiled from public records. However, it does not represent the official records of the County Assessor. These records are for information purposes only. No liability is assumed by the County Assessor or TIMS for the accuracy or completeness of this information. The user is directed to the office of the County Assessor for official assessment records. (3) THE WARRANTY AND LIMITATIONS SET FORTH ABOVE ARE EXCLUSIVE AND IN LIEU OF ALL OTHERS, ORAL OR WRITTEN, EXPRESS OR IMPLIED. No TIMS dealer, distributor, agent, or employee is authorized to make any modification or addition to the Limited Warranty set forth above. (4) Some states do not allow the exclusion or limitation of implied warranties or limitations of liability for incidental or consequential damages, so the above limitations or exclusions may not apply to this License. NOTE: All orders are subject to approval by TIMS. SUBSCRIBER SEE PAGE 4 TRANSAMERICA INFORMATION MANAGEMENT ----------------------- REPRESENTATIVE ______________________ AUTHORIZED SIGNATURE DATE:----------------------------- DATE: _______________________________ /s/ Christopher A. Crane 12/17/92 APPROVED BY: /s/ James E. Gregg ------------------------- DATE: 12/17/92 -------------------------------- TRANSAMERICA INFORMATION MANAGEMENT SERVICES Supercedes all previous agreement METROSCAN 1860 Howe Avenue, #455 Sacramento, CA 95825 (916) 921-6629 (800) 866-2783 (916) 921-6781 (FAX) PAGE 3 of 4 ----- ----- LICENSE AND SUBSCRIPTION AGREEMENT ---------------------------------- Subject to the terms and conditions on the reverse side, Transamerica Information Management Services ("TIMS") hereby grants a limited non-exclusive, non-transferable license to use the METROSCAN(TM) CD-ROM databases for the localities identified below, together with the METROSCAN(TM) Software and associated manuals and other printed material ("documentation") provided with this package (hereinafter referred to collectively as "METROSCAN(TM)") to the following person (hereinafter referred to as the "Licensee"): LICENSE (SOLD TO) (BILL TO) Name________________________________ Name_______________________________ Company COMPS Company____________________________ ----------------------------- Address_____________________________ Address____________________________ City___________ State ____ Zip _____ City ______ State _____ Zip ______ Phone _________ FAX: _________ Phone __________ FAX: ________ BUSINESS TYPE:______________________ Subject to the terms and conditions on the reverse side, TIMS agrees to provide the licensee with METROSCAN(TM) for the following localities, and to update those databases on a monthly basis.: (MidMonth Updates Where Avail.) ---- ALAMEDA COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ---- SAN FRANCISCO COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ---- MARIN COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ---- SANTA CLARA COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ---- CONTRA COSTA COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- ------- ___________________________ NETWORKING FEES (IF APPLICABLE) = _______ CD-ROM DRIVE REQUIREMENT: = _______ HARDWARE/SOFTWARE: = _______
Diskette Type: [ ] 5 1/4" [ X ] 3 1/2 - --------------------------------------- SPECIAL INSTRUCTIONS - --------------------------------------- __________________________________ __________________________________ __________________________________ __________________________________ __________________________________ __________________________________ - --------------------------------------- PAYMENT TERMS: All invoices are due and payable upon receipt. Unpaid invoices are subject to late charges. MetroScan(TM) shipments will be suspended on past- due accounts. Term of the agreement shall be for 12 months commencing 12/1 1992 to 12/1 1993 -- ---- ---- ---- ---- and is non-cancelable for that period; except that TIMS may terminate this Agreement at any time for non payment of the license fee or if Licensee fails to comply with any provision of this Agreement. This Agreement shall automatically renew annually unless written notice of cancellation is given by either party 60 days prior to the expiration date of each term. _______ My check the amount of $_________________ is enclosed. _______ Please charge my _____ VISA _____ MASTERCARD Card Number: ____________ Expiration Date: __________ EQUIPMENT REQUIREMENTS: IBM-PC/XT/AT, 386, PS/2 or compatible with 640K of RAM Computer Model:_____________________ Microsoft DOS___________ Amount of Memory:___________________ Hard Disk (must have 2 mb of free space per county) DOS Version:________________________ Available expansion slot Amount of Free Space on Hard Disk___ Maps require VGA or EGA monitor & card Monitor/Graphics Card:______________
WARNING! I HAVE BEEN INFORMED THAT I SHOULD BACK UP MY HARD DISK PRIOR TO THE INSTALLATION OF THE METROSCAN(TM) CD-ROM DRIVE INTERFACE CARD. I HOLD TIMS HARMLESS FOR THE INSTALLATION. Licensee's Initials: _______________ TERMS AND CONDITIONS -------------------- CAREFULLY READ THE FOLLOWING TERMS AND CONDITIONS BEFORE YOU ENTER THIS LICENSE AGREEMENT. YOUR SIGNATURE BELOW CONSTITUTES YOUR ACCEPTANCE OF THESE TERMS AND CONDITIONS. OWNERSHIP OF METROSCAN(TM) MetroScan(TM) shall remain the property of Transamerica Information Management Services (TIMS) at all times and shall be surrendered to TIMS at the licensee's expense at such time as the License and Subscription Agreement shall be terminated. TIMS reserve the right to request that Licensee return all CD-ROM's, monthly updates, and documentation within 10 days of receipt of each new month's updates. PROHIBITED USES/YOU MAY: . Use MetroScan(TM) on any compatible computer, provided you use it only one computer at a time. . Use MetroScan(TM) on a network, file server or virtual disk, provided that access is limited to one user at a time and that you have the original copy of the documentation and the program disks. If MetroScan is used by multiple- users on a network, then each network node will bear a surcharge for MetroScan's network pricing schedule. TIMS is not responsible for the functionality or performance of the network operating system or software. PROHIBITED USES/YOU MAY NOT --- . Make copies of the documentation or program disks, except as described in the documentation. . Loan, rent, sub-license, or otherwise transfer the software or the documentation, except as provided above. . Alter, modify or adapt the software or documentation, including, but not limited to, translating, decompiling, disassembling or creating derivative works. Licensee if not permitted to download more than 5,000 data records without explicit written permission from licensor. THIS LICENSE AND YOUR RIGHT TO USE THE SOFTWARE AUTOMATICALLY TERMINATE IF YOU FAIL TO COMPLY WITH ANY PROVISION OF THIS LICENSE AGREEMENT. UPON TERMINATION, YOU WILL IMMEDIATELY RETURN ALL DOCUMENTATION AND DISKS. LIMITED WARRANTY LIMITED WARRANTY TIMS warrants that MetroScan(TM) will substantially conform to published specifications and to the documentation, provided that it is used on the computer hardware and with the operating system for which it was designed. TIMS also warrants that the magnetic media on which the software is distributed and the documentation are free from defects in materials and workmanship. TIMS will replace defective media or documentation or correct substantial software errors at no charge, provided Licensee returns the item with dated proof of payment to TIMS within ten (10) days of the date of delivery. If TIMS is unable to replace defective media or documentation or to correct substantial software errors, TIMS will refund the license fee. These are the Licensee's sole remedies for any breach of warranty. DISCLAIMER (1) EXCEPT AS SPECIFICALLY PROVIDED ABOVE, TIMS MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THIS SOFTWARE OR DOCUMENTATION, INCLUDING THEIR QUALITY, PERFORMANCE, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL TIMS BE LIABLE FOR DIRECT, INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OF OR INABILITY TO USE METROSCAN(TM) (AND/OR ASSOCIATED SOFTWARE OR DOCUMENTATION), EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. In particular, TIMS is not responsible for any costs, including, but not limited to, those incurred as a result of lost profits or revenue, loss of MetroScan(TM), loss of data, the cost of recovering such software or data, the cost of substitute software, or claims by third parties. In no case shall TIMS' liability exceed the amount of the license fee. (2) The information contained in MetroScan(TM) has been compiled from public records. However, it does not represent the official records of the County Assessor. These records are for information purposes only. No liability is assumed by the County Assessor or TIMS for the accuracy or completeness of this information. The user is directed to the office of the County Assessor for official assessment records. (3) THE WARRANTY AND LIMITATIONS SET FORTH ABOVE ARE EXCLUSIVE AND IN LIEU OF ALL OTHERS, ORAL OR WRITTEN, EXPRESS OR IMPLIED. No TIMS dealer, distributor, agent, or employee is authorized to make any modification or addition to the Limited Warranty set forth above. (4) Some states do not allow the exclusion or limitation of implied warranties or limitations of liability for incidental or consequential damages, so the above limitations or exclusions may not apply to this License. NOTE: All orders are subject to approval by TIMS. TRANSAMERICA INFORMATION MANAGEMENT REPRESENTATIVE ____________________ DATE: _____________________________ APPROVED BY: /s/ James E. Gregg ---------------------- DATE: 12/17/92 ------------------------------ SUBSCRIBER SEE PAGE 4 ------------------------ AUTHORIZED SIGNATURE DATE: _______________________________ /s/ Christopher A. Crane 12/17/98 TRANSAMERICA INFORMATION MANAGEMENT SERVICES Supercedes all previous agreements METROSCAN 1860 Howe Avenue, #455 Sacramento, CA 95825 (916) 921-6629 (800) 866-2783 (916) 921-6781 (FAX) PAGE 4 of 4 ----- ----- LICENSE AND SUBSCRIPTION AGREEMENT ---------------------------------- Subject to the terms and conditions on the reverse side, Transamerica Information Management Services ("TIMS") hereby grants a limited non-exclusive, non-transferable license to use the METROSCAN(TM) CD-ROM databases for the localities identified below, together with the METROSCAN(TM) Software and associated manuals and other printed material ("documentation") provided with this package (hereinafter referred to collectively as "METROSCAN(TM)") to the following person (hereinafter referred to as the "Licensee"): LICENSE (SOLD TO) (BILL TO) Name________________________________ Name ______________________________ Company COMPS Company____________________________ ----------------------------- Address_____________________________ Address____________________________ City _________ State ____ Zip _____ City ______ State ____ Zip ________ Phone _________ FAX: _________ Phone __________ FAX:_________ BUSINESS TYPE:______________________ Subject to the terms and conditions on the reverse side, TIMS agrees to provide the licensee with METROSCAN(TM) for the following localities, and to update those databases on a monthly basis.: (MidMonth Updates Where Avail.) ---- SAN JOAQUIN COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- -------- ---- STANISLAUS COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- -------- ---- SACRAMENTO COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- -------- ---- SONOMA COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- -------- ---- SAN MATEO COUNTY DATA/MAPS/BOTH _____ X _____ = 500.00 - --------------------------- ---- -------- ___________________________ Subtotal = 12545.00 -------- Less 25% = *3136.25 -------- * means less than
Diskette Type: [ ] 5 1/4" [ X ] 3 1/2
- ------------------------------------------------------------------------------------- SPECIAL INSTRUCTIONS SUBTOTAL: $ 9408.75 --------------- State Sales Tax $_______________ - ------------------------------------------------------------------------------------- __________________________________ Account Initiation Fee $_____________ TAX-EXEMPT-CA RESALE # (Training, Software - ---------------------------------- Support, Customer Hotline and Freight) SEE ATTACHED CARD Installation Fee $ 9408.75 - ---------------------------------- ------------- __________________________________ TOTAL PRICE $_____________ __________________________________ LESS DEPOSIT $_____________ __________________________________ BALANCE DUE $_____________ - -------------------------------------------------------------------------------------
PAYMENT TERMS: All invoices are due and payable upon receipt. Unpaid invoices are subject to late charges. MetroScan(TM) shipments will be suspended on past- due accounts. Term of the agreement shall be for 12 months commencing 12/1 1992 to 12/1 1993 -- ---- ---- ---- ---- and is non-cancelable for that period; except that TIMS may terminate this Agreement at any time for non payment of the license fee or if Licensee fails to comply with any provision of this Agreement. This Agreement shall automatically renew annually unless written notice of cancellation is given by either party 60 days prior to the expiration date of each term. _______ My check the amount of $_________________ is enclosed. _______ Please charge my _____ VISA _____ MASTERCARD Card Number: ____________ Expiration Date: __________ EQUIPMENT REQUIREMENTS: IBM-PC/XT/AT, 386, PS/2 or compatible with 640K of RAM Computer Model:_____________________ Microsoft DOS___________ Amount of Memory:___________________ Hard Disk (must have 2 mb of free space per county) DOS Version:________________________ Available expansion slot Amount of Free Space on Hard Disk___ Maps require VGA or EGA monitor & card Monitor/Graphics Card:______________
WARNING! I HAVE BEEN INFORMED THAT I SHOULD BACK UP MY HARD DISK PRIOR TO THE INSTALLATION OF THE METROSCAN(TM) CD-ROM DRIVE INTERFACE CARD. I HOLD TIMS HARMLESS FOR THE INSTALLATION. Licensee's Initials: _______________ TERMS AND CONDITIONS -------------------- CAREFULLY READ THE FOLLOWING TERMS AND CONDITIONS BEFORE YOU ENTER THIS LICENSE AGREEMENT. YOUR SIGNATURE BELOW CONSTITUTES YOUR ACCEPTANCE OF THESE TERMS AND CONDITIONS. OWNERSHIP OF METROSCAN(TM) MetroScan(TM) shall remain the property of Transamerica Information Management Services (TIMS) at all times and shall be surrendered to TIMS at the licensee's expense at such time as the License and Subscription Agreement shall be terminated. TIMS reserve the right to request that Licensee return all CD-ROM's, monthly updates, and documentation within 10 days of receipt of each new month's updates. PROHIBITED USES/YOU MAY: . Use MetroScan(TM) on any compatible computer, provided you use it only one computer at a time. . Use MetroScan(TM) on a network, file server or virtual disk, provided that access is limited to one user at a time and that you have the original copy of the documentation and the program disks. If MetroScan is used by multiple- users on a network, then each network node will bear a surcharge for MetroScan's network pricing schedule. TIMS is not responsible for the functionality or performance of the network operating system or software. PROHIBITED USES/YOU MAY NOT --- . Make copies of the documentation or program disks, except as described in the documentation. . Loan, rent, sub-license, or otherwise transfer the software or the documentation, except as provided above. . Alter, modify or adapt the software or documentation, including, but not limited to, translating, decompiling, disassembling or creating derivative works. Licensee if not permitted to download more than 5,000 data records without explicit written permission from licensor. THIS LICENSE AND YOUR RIGHT TO USE THE SOFTWARE AUTOMATICALLY TERMINATE IF YOU FAIL TO COMPLY WITH ANY PROVISION OF THIS LICENSE AGREEMENT. UPON TERMINATION, YOU WILL IMMEDIATELY RETURN ALL DOCUMENTATION AND DISKS. LIMITED WARRANTY LIMITED WARRANTY TIMS warrants that MetroScan(TM) will substantially conform to published specifications and to the documentation, provided that it is used on the computer hardware and with the operating system for which it was designed. TIMS also warrants that the magnetic media on which the software is distributed and the documentation are free from defects in materials and workmanship. TIMS will replace defective media or documentation or correct substantial software errors at no charge, provided Licensee returns the item with dated proof of payment to TIMS within ten (10) days of the date of delivery. If TIMS is unable to replace defective media or documentation or to correct substantial software errors, TIMS will refund the license fee. These are the Licensee's sole remedies for any breach of warranty. DISCLAIMER (1) EXCEPT AS SPECIFICALLY PROVIDED ABOVE, TIMS MAKES NO WARRANTY OR REPRESENTATION, EITHER EXPRESS OR IMPLIED, WITH RESPECT TO THIS SOFTWARE OR DOCUMENTATION, INCLUDING THEIR QUALITY, PERFORMANCE, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL TIMS BE LIABLE FOR DIRECT, INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OF OR INABILITY TO USE METROSCAN(TM) (AND/OR ASSOCIATED SOFTWARE OR DOCUMENTATION), EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. In particular, TIMS is not responsible for any costs, including, but not limited to, those incurred as a result of lost profits or revenue, loss of MetroScan(TM), loss of data, the cost of recovering such software or data, the cost of substitute software, or claims by third parties. In no case shall TIMS' liability exceed the amount of the license fee. (2) The information contained in MetroScan(TM) has been compiled from public records. However, it does not represent the official records of the County Assessor. These records are for information purposes only. No liability is assumed by the County Assessor or TIMS for the accuracy or completeness of this information. The user is directed to the office of the County Assessor for official assessment records. (3) THE WARRANTY AND LIMITATIONS SET FORTH ABOVE ARE EXCLUSIVE AND IN LIEU OF ALL OTHERS, ORAL OR WRITTEN, EXPRESS OR IMPLIED. No TIMS dealer, distributor, agent, or employee is authorized to make any modification or addition to the Limited Warranty set forth above. (4) Some states do not allow the exclusion or limitation of implied warranties or limitations of liability for incidental or consequential damages, so the above limitations or exclusions may not apply to this License. NOTE: All orders are subject to approval by TIMS. TRANSAMERICA INFORMATION MANAGEMENT SUBSCRIBER /s/ Christopher A. Crane REPRESENTATIVE JAMES S. GREGG ------------------------------- -------------------- AUTHORIZED SIGNATURE PRESIDENT DATE: _____________________________ DATE: 12/17/92 APPROVED BY: /s/ James E. Gregg ------------------------------------- ---------------------- DATE: 12/17/92 ------------------------------ ADDENDUM TO LICENSE AND SUBSCRIPTION AGREEMENT BETWEEN BUSINESS REAL ESTATE INFORMATION CORP. AND TRANSAMERICA INFORMATION MANAGEMENT SERVICES The License and Subscription Agreement ("Agreement") between Business Real Estate Information Corp., dba COMPS ("COMPS") and Transamerica Information Management Services ("TIMS") for METROSCAN services is clarified or modified in the following respects: 1. ANNUAL PRICING: The prices set forth in the Agreement are annual charges and are due and payable at the beginning of the 1 year term. 2. DELIVERIES AND ACCESS TO INFORMATION: TIMS will use its best efforts to deliver periodic updates of METROSCAN information to COMPS on a first priority basis. TIMS will make METROSCAN data available to COMPS for those counties to which COMPS has subscribed through its planned on-line services, modern transfer or floppy disks services as soon as they become available, and permit COMPS access to that information as frequently as reasonably possible. 3. USE OF MERTOSCAN INFORMATION. TIMS acknowledges that COMPS will be using the METROSCAN information it receives in connection with its activities as a provider of "value added information". It is agreed, therefore, that COMPS may use the METROSCAN information in the following ways: A. COMPS may use the information for initial research purposes and then republish that information in a "value added" format, i.e. in conjunction with additional information obtained by COMPS from other sources or through it own research. B. COMPS may directly publish copies of the METROSCAN maps provided as part of the service, with appropriate credit to METROCSAN and protections for METROSCAN'S copyrights and trademarks. C. COMPS may use the METROSCAN information through a local area network wholly within the COMPS offices. D. COMPS understand that METROSCAN data will be used in conjunction with existing COMPS services. This information will not be sold or distributed to any organization outside of COMPS. 4. PROSPECT LIST - BROKERS: COMPS will provide names to TIMS from its Qualified Prospect List of Brokers at a 25% discount off the regular published price, with the understanding that TIMS will not republish this information or any other information which may be published by or obtained from COMPS, either alone or together with other information, without COMPS' prior written approval. 5. RIGHT TO RENEW: At the end of each of the initial term of the Agreement and each of the 9 year following the initial term of the Agreement, COMPS shall have the right to renew this Agreement for an additional year on the following terms: A. The annual pricing on a renewal of the Agreement shall be the same as the initial pricing, plus any regular price increase instituted by TIMS effective for that renewal year, but adjusted to account for the 25% discount granted to COMPS in the Agreement's initial pricing. The annual fee shall be paid by COMPS at the commencement of the renewal term. B. At any time during the term of the original Agreement or any renewal thereof, COMPS may add or reinstate, at the end of any term discontinue, the METROSCAN service for any county for which the METROSCAN service of offered. Pricing shall reflect the initial 25% discount and, for additions or reinstatements during the term of an Agreement, will be prorated on an annual basis. Payment for additions or reinstatements during the term of the Agreement will be made at the time of the addition or reinstatement. 6. SUCCESSORS: The Agreement be assumed by successors to COMPS in the provision of the value added information services it currently or in the future may offer. Business Real Estate Information Corp. By: /s/ Christopher A. Crane, President 12/17/92 Transamerica Information Management Services By: /s/ James E. Gregg Vice President 12/17/92 EX-10.26 31 LICENSE AGMT DATED 12/2/98 EXHIBIT 10.26 LICENSE AGREEMENT This License Agreement (this "Agreement") is made and entered into this 2nd day of Dec., 1998, between COMPS INFOSYSTEMS, INC., having an office at Suite 100, 9888 Carroll Centre Road, San Diego, California USA 92126 ("LICENSEE") and NCOMPASS LABS INC., having an office at Second Floor, Hudson House, 321 Water Street, Vancouver, British Columbia Canada V6B 1B8 ("NCompass"). RECITALS A. LICENSEE and NCompass are manufacturers of computer software; B. NCompass is the manufacturer and owner of a certain computer software program known as the NCompass ScriptActive(TM) ActiveX(TM) Plug-in; C. LICENSEE is the manufacturer of certain computer software programs which use ActiveX technology ("ActiveX"); D. LICENSEE desires to obtain, and NCompass is willing to grant, a license to a modified version of the NCompass ScriptActive(TM) ActiveX(TM) Plug-in to enable LICENSEE's end users using a Netscape browser platform to view LICENSEE's Spectrum software product and/or any successor products. AGREEMENT IN CONSIDERATION OF the premises and mutual covenants 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. INTERPRETATION 1.1 DEFINITIONS. In this Agreement, the following words shall have the following meanings: (a) "CONFIDENTIAL INFORMATION" shall mean all information, documentation, knowledge or data of an intellectual, technical, scientific, commercial or industrial nature relating to the business or Intellectual Property of the disclosing party, including, without limitation, the Source Code of the Licensed Material and information of a financial, planning, cost, pricing or marketing nature which derives actual or potential value from not being generally known or reasonably ascertainable, whether developed by the disclosing party or received by the disclosing party from a third party in circumstances which oblige it to protect such information from unauthorized use or disclosure, but shall not include any information which: (i) now or hereafter becomes generally known to the public or is generally known within the computer software industry, without breach of this Agreement; (ii) can be proved by the receiving party to have been known by it before disclosure; (iii) can be proved by the receiving party to have been received by a third party without breach of a duty of confidentiality or wrongful appropriation of trade secrets; (iv) can be proved by the receiving party to have been developed by it independently of any disclosure hereunder; or (v) is required to be disclosed by law, court order or regulatory process. (b) "INTELLECTUAL PROPERTY" shall mean any discoveries, improvements, ideas, patents, copyrights, trade marks, industrial designs, mask works, trade secrets, goodwill and the like, including, without limitation, computer programs, source codes, technical writings, pictorial reproductions, drawings and other graphic representations, whether or not copyrighted or patented or registered or protected, or capable of such registration or protection. (c) "LICENSED MATERIAL" shall mean the Source Code to the NCompass ScriptActive(TM) ActiveX(TM) Plug-in installation program and the Object Code to the modified version of the NCompass ScriptActive(TM) ActiveX(TM) Plug-in (customized to function only with the LICENSEE Product), which is more fully described in Schedule A attached to this Agreement, together with all Updates to which LICENSEE is entitled under the terms of this Agreement. (d) "OBJECT CODE" shall mean computer code in a form for execution on a computer and/or the code that results from running Source Code through a compiler. (e) "SOURCE CODE" shall mean computer code in high-level, human readable language, including comments, and all tools and documentation reasonably necessary to build and/or modify such code. (f) "TECHNICAL SUPPORT SERVICES" shall mean the technical support services provided by NCompass to LICENSEE as set out in Schedule B. (g) "BUG" shall mean any failure of the Licensed Materials to function within the specifications as set forth in Schedule A and the documentation accompanying the Licensed Materials, except for those failures which do not cause loss of end user data and do not prevent end users from performing production tasks or for which there is a known work-around which has been provided to LICENSEE. (h) "DEVELOPMENT SERVICES" shall mean development services which generate enhancements to the Licensed Material specific to the requirements of LICENSEE (including development services required to enable LICENSEE's end users using a Netscape Navigator platform to view any successor products to LICENSEE's software product) and which are in addition to the functionality described in Schedule A and Updates, as described herein. (i) "UPDATES" shall mean all maintenance releases, releases supporting any and all releases of Netscape Navigator or Netscape's WWW browser which are made commercially available during the terms of this Agreement, patches, Bug fixes and error corrections to the Licensed Material that do not provide significant additional functionality to the Licensed Material and, for avoidance of doubt, does not include enhancements generated by Development Services. (j) "LICENSEE PRODUCT" shall mean LICENSEE's Spectrum software product and/or any successor products which use ActiveX technology. 1.2 CURRENCY. All references to monetary amounts in this Agreement shall mean the lawful currency of the United States of America and all payments hereunder shall be made in such currency. 2. GRANT OF RIGHTS AND OBLIGATIONS 2.1 GRANT OF LICENSE. NCompass hereby grants to LICENSEE a non-transferable, non-exclusive, worldwide license directly and through third parties (including the right of any third party at any tier to further sublicense solely in conjunction with the distribution of the LICENSEE Product) to reproduce, distribute, license, sell, rent and lease copies of the Licensed Material in Object Code form only, and derivative works Page 2 of 15 thereof, as a component of the LICENSEE Product for a 12 month period commencing upon the date of execution of this Agreement (the "Initial Term"). 2.2 RENEWAL. Provided that LICENSEE is not in material breach of this Agreement, LICENSEE may renew the grant of license for a further 12 month period upon expiration of the Initial Term (the "Renewal Term") subject to the terms contained herein and by providing NCompass with written notice thereof at least 30 days prior to expiration of the Initial Term and by paying to NCompass the renewal license fee at a price to be agreed upon between the parties. 2.3 MANUFACTURING COSTS. Except as otherwise set out in this Agreement, NCompass shall not be responsible for any manufacturing or distribution costs of LICENSEE relating to the use of the Licensed Material by LICENSEE. LICENSEE shall bear all costs of reproducing and distributing the Licensed Material in accordance with the terms and conditions of this Agreement. 3. LICENSE FEE 3.1 LICENSE FEE. LICENSEE shall pay to NCompass a royalty (the "License Fee") for all copies of the LICENSEE Product sold by LICENSEE as follows: (a) within 30 days of execution of this Agreement, LICENSEE shall make the first nonrefundable royalty prepayment of three thousand six hundred (US$3,600) against the first 1,000 client computers upon which the Licensed Material in installed ("Copies") during the Initial Term; (b) within 120 days of execution of this Agreement, LICENSEE shall make the second nonrefundable royalty prepayment of three thousand six hundred (US$3,600) against the first 1,000 client computers upon which the Licensed Material is installed ("Copies") during the Initial Term; (c) LICENSEE shall pay NCompass a royalty of four dollars (US$4.00) per copy for the next 2,000 Copies or any portion thereof of Copies licensed during the Initial Term; and (d) LICENSEE shall pay NCompass a royalty of three dollars (US$3.00) per copy for any copies in excess of the first 3,000 Copies licensed during the Initial Term. LICENSEE agrees to furnish to NCompass, within 30 days of the end of each three month period following execution of this Agreement, a written report certified by the Chief Financial Officer of LICENSEE verifying the number of Copies licensed during the preceding three month period, and to make full payment of all monies due NCompass within 30 days thereafter. 3.2 TAXES. All amounts payable under this Agreement do not include taxes. LICENSEE shall be responsible for the payment of any federal, provincial, state or local taxes which may apply to the payments hereunder; provided, that LICENSEE shall not be responsible for the payment of any taxes based on the income or revenue of NCompass. 3.3 MODIFICATIONS. Except as expressly authorized by NCompass in writing, LICENSEE shall not, and shall ensure that its sublicensees, employees, agents or others acting on its behalf, do not: (a) modify, translate, reverse engineer, decompile, disassemble, create derivative works of or copy the Licensed Material or any accompanying documentation; and (b) remove, alter, cover, or fail to reproduce any copyright notices or other proprietary rights, notices, placed on or embedded in the Licensed Material by NCompass. Page 3 of 15 4. DELIVERY OF LICENSED MATERIAL 4.1 DELIVERY. NCompass shall deliver the Licensed Material to LICENSEE electronically within seven business days of execution of this Agreement, in such form and content as instructed by LICENSEE. The Licensed Material shall be deemed delivered upon delivery by NCompass to LICENSEE of the Licensed Materials and LICENSEE's successful download of the Licensed Materials. 4.2 ACCEPTANCE. Upon receipt of the Licensed Material, LICENSEE shall evaluate the Licensed Material and shall submit a written notice of acceptance or written notice of rejection to NCompass within 15 business days of receipt by LICENSEE of the Licensed Material (the "Acceptance Period"). Conformity to the specifications and warranties set out in this Agreement shall solely determine LICENSEE's right to accept or reject the Licensed Material. 4.3 DEEMED ACCEPTANCE. If LICENSEE fails to notify NCompass of acceptance within the Acceptance Period, or notifies NCompass of the acceptance of the Licensed Material within the Acceptance Period but fails to provide confirmation in writing, the Licensed Material shall be deemed accepted and such an event shall constitute approval, sign-off and acceptance by LICENSEE of the Licensed Material provided by NCompass under this Agreement. 4.4 NON-COMPLIANCE. If LICENSEE provides NCompass with a notice of rejection within the Acceptance Period stating that the Licensed Material does not comply with the specifications or warranties set out in this Agreement, and provides NCompass with a full disclosure of how the Licensed Material is unsatisfactory, NCompass shall promptly correct such portion of the Licensed Material. If NCompass fails to correct any portion of the Licensed Material within 15 days after receipt of the notice of rejection, or fails to deliver any portion of the Licensed Material within the dates specified in the delivery schedule set out in Article 4.1 of this Agreement, LICENSEE may, at LICENSEE's option: (a) extend the correction or delivery period for such portion of the Licensed Material; or (b) return the Licensed Material to NCompass and receive a full refund of any monies paid and terminate this Agreement with no further obligation to NCompass. This is the sole remedy available to LICENSEE in connection with such termination. 5. TECHNICAL SUPPORT, MAINTENANCE AND DEVELOPMENT SERVICES 5.1 INITIAL TERM SUPPORT SERVICES. NCompass shall provide to LICENSEE, during the Initial Term, the Technical Support Services, for a fee in the amount of two thousand eight hundred dollars (US$2,800) for the Initial Tenn. Within 30 days of execution of this Agreement, LICENSEE shall make the first installment payment against the Technical Support Services fee of one thousand four hundred dollars (US$1,400) and within 120 days of execution of this Agreement, LICENSEE shall make the second installment payment against the Technical Support Services fee of one thousand four hundred dollars (US$1,400). 5.2 RENEWAL TERM SUPPORT SERVICES. LICENSEE may renew the Technical Support Services provided by NCompass under Article 5.1 for the Renewal Term, upon written notice at least 30 days prior to expiration of the Initial Term. LICENSEE shall pay to NCompass for the Renewal Term, a fee in the amount of two thousand eight hundred dollars (US$2,800), for Technical Support Services. Such fee shall be due and payable within 60 days of the commencement of the Renewal Term. 5.3 AUTHORIZED REPRESENTATIVES. LICENSEE shall appoint up to three persons and NCompass shall appoint up to three persons as their respective authorized support representatives who shall deal exclusively in the receipt and provision of the Technical Support Services. Page 4 of 15 5.4 BEST EFFORTS. In providing the Technical Support Services, NCompass shall cooperate with LICENSEE and use its best efforts to resolve reported support issues or correct errors within its control in the Licensed Material and will issue such materials as are required to effect such corrections. 5.5 NO ADDITIONAL SUPPORT. LICENSEE shall be responsible for all technical support services provided to its sublicensees, distributors and end users. NCompass shall not be responsible for the provision of Technical Support Services or any other technical support services to any person other than LICENSEE. LICENSEE shall not direct its sublicensees, distributors or end users to contact NCompass without the prior consent of NCompass. 5.6 UPDATES. LICENSEE acknowledges and agrees that NCompass may, from time to time, develop Updates. For so long as LICENSEE is paying to NCompass the fee for Technical Support Services, NCompass shall provide Updates to LICENSEE at no additional cost. NCompass shall provide LICENSEE advance notice of the release of any Update and shall promptly provide LICENSEE with copies of such Updates upon their initial release. 5.7 TRAINING. During the Initial Term and the Renewal Term, NCompass shall provide to LICENSEE training in the use of the Licensed Material at the rate of one hundred and twenty-five dollars (US$125) per hour. LICENSEE shall also reimburse NCompass for its reasonable travel and accommodation expenses incurred in providing such training. 5.8 DEVELOPMENT SERVICES. During the Initial Term and the Renewal Term, NCompass shall make available to LICENSEE, software development services relating to enhancements of the Licensed Material specific to the requirements of LICENSEE and in addition to the functionality as set out in Schedule A, at the rate of one hundred and twenty-five dollars (US$125) per hour. 6. PROPRIETARY RIGHTS AND OBLIGATIONS 6.1 ACKNOWLEDGMENT OF RIGHTS. LICENSEE hereby acknowledges and agrees that the Licensed Material embodies NCompass' Intellectual Property and all right, title and interest in and to NCompass' Intellectual Property, including the Licensed Material. LICENSEE agrees that such rights shall remain the sole and exclusive property of NCompass and no rights therein shall vest in LICENSEE, except as expressly set out in this Agreement. LICENSEE shall indicate to each of its sublicensees that NCompass' Licensed Material is owned by or licensed to NCompass. 6.2 PROTECTION OF CONFIDENTIAL INFORMATION. Except as provided in this agreement, LICENSEE and NCompass shall maintain all Confidential Information of the other party disclosed to it in strict confidence and shall not disclose same to any person except to its employees or contractors having a need to know under this Agreement. LICENSEE and NCompass agree to take all safeguards and actions to maintain the confidentiality of the other party's Confidential Information to the extent normally taken in protecting their own Confidential Information and in any event to a commercially reasonable standard. 6.3 PROTECTION OF INTELLECTUAL PROPERTY. LICENSEE and NCompass agree to take all safeguards and lawful actions reasonably requested by the other party to protect the Intellectual Property of the other party, including, without limitation, promptly notifying the other party upon becoming aware of: (a) any notices, actions, threats, or allegations regarding the Licensed Material or any of the other party's Intellectual Property; or (b) any infringement or suspected infringement by any third parties of any of the other party's Intellectual Property. Each party agrees to provide, at the other party's expense, all reasonable assistance in the registration of any of the other party's Intellectual Property in any jurisdiction. Page 5 of 15 6.4 USE OF NCOMPASS TRADEMARKS. "NCompass", "ScriptActive", and all other trademarks and trade names adopted by NCompass to identify the Licensed Material and other NCompass products or services are and shall remain the property of NCompass and the benefit and goodwill accruing from the usage of such trademarks and trade names by LICENSEE shall belong to NCompass. LICENSEE shall have the right to use the trademarks "NCompass" and "ScriptActive" solely to refer to the Licensed Material, provided that LICENSEE shall: (a) comply with NCompass' trademark guidelines as set forth on Schedule C attached hereto; (b) include, in any use of any trademark of NCompass, the symbol "TM" and the following statement "___________ is a trademark of NCompass Labs Inc., Vancouver, Canada"; (c) not use the trademarks "NCompass" and "ScriptActive" as any portion of the LICENSEE trade name or for any of LICENSEE's products; (d) at no time challenge or assist others in challenging any NCompass trademark or the registration thereof; (e) at no time attempt to register any trademarks or trade names confusingly similar to any NCompass trademark or trade name; (f) at no time register, translate or substitute any NCompass trademark or trade names anywhere in the world without NCompass' express prior written consent; and (g) include within the packaging of the LICENSEE Product, a graphic design of the NCompass logo and text identifying NCompass as the supplier of the Licensed Material. NCompass shall provide copies of its trademark guidelines as they may be modified from time to time in quantities reasonably requested by LICENSEE, and LICENSEE may distribute copies of such guidelines to users of the Licensed Material. LICENSEE shall have no other rights to use the trademarks or trade names except as provided herein. 6.5 USE OF LICENSEE LOGO. LICENSEE hereby grants to NCompass a non- transferable, non-exclusive, fully paid-up, worldwide license to exhibit the LICENSEE logo on the NCompass Web site, until such right is revoked by LICENSEE by notice in writing to NCompass. NCompass acknowledges and agrees that the logo shall remain the property of LICENSEE and that any benefit and goodwill accruing from the usage of such logo by NCompass shall belong to LICENSEE. NCompass shall have no other rights to use the logo, except as provided herein. 6.6 MARKETING RESPONSIBILITIES OF LICENSEE. In marketing and selling the Licensed Material, LICENSEE shall take all reasonable steps to avoid deceptive or misleading practices which may be detrimental to NCompass or to the market for the Licensed Material. 7. REPRESENTATIONS AND WARRANTIES 7.1 NCOMPASS REPRESENTATIONS AND WARRANTIES. NCompass represents and warrants: (a) that it has the right and power to license the Licensed Material; (b) that the execution and delivery of this Agreement does not violate or constitute a breach of the terms of any agreement, document, charter or by laws to which NCompass is a party or otherwise bound; (c) to the best of its knowledge and belief, the Licensed Materials do not infringe any patent, copyright, trademark, trade secret or other intellectual property rights of any third party; Page 6 of 15 (d) that it has full corporate right, power and authority to enter into this Agreement and performs the acts required of it hereunder; and (e) neither this Agreement (or any term hereof) nor the performance of its obligations under this Agreement, is restricted by, contrary to, in conflict with, ineffective under, requires registration or approval or tax withholding under any law or regulation. 7.2 LICENSEE REPRESENTATIONS AND WARRANTIES. LICENSEE represents and warrants: (a) that it has full corporate right, power and authority to enter into this Agreement and performs the acts required of it hereunder; and (b) neither this Agreement (or any term hereof) nor the performance of its obligations under this Agreement, is restricted by, contrary to, in conflict with, ineffective under, requires registration or approval or tax withholding under any law or regulation. 8. SOFTWARE WARRANTY 8.1 SOFTWARE FUNCTIONALITY. NCompass warrants that the Licensed Material, if operated as directed, will substantially achieve the functionality described in Schedule A and in its documentation. NCompass does not warrant that the use of the Licensed Material will be uninterrupted or that the operation of the Licensed Material will be error-free or secure. 8.2 SOFTWARE REPRODUCTION. NCompass accepts no responsibility for defects in material and workmanship associated with the reproduction of the Licensed Material by LICENSEE, nor in the media containing the Licensed Material provided by LICENSEE to its sublicensees and end users. 8.3 INDEMNITY. NCompass shall indemnify and hold LICENSEE harmless and will defend, at its own expense (including reasonable legal fees of LICENSEE), any threatened or actual suit against LICENSEE based upon a claim that the Licensed Material, its use or the documentation therefor infringes upon a patent, copyright, trade secret or other intellectual property right of any third party, and will pay any settlement, costs and damages awarded; provided that: (a) such infringement has not resulted from a modification of the Licensed Material which has been effected by or for LICENSEE including without limitation as a result of the provision of Development Services. For avoidance of doubt, the indemnification obligation of NCompass, if any, relating to the provision to LICENSEE of Development Services may be addressed by the parties in any separate agreement relating to the provision of Development Services; (b) NCompass is promptly notified in writing of any notice received by LICENSEE of any claim or of any threatened or actual suit, but the failure to give such prompt notice shall not relieve NCompass of its obligations hereunder unless such delay results in a material prejudice to the defense thereof; (c) NCompass shall have the right to control the defense of any claims, suits or proceedings and LICENSEE shall not settle any claims, suits, or proceedings without NCompass' prior consent; (d) at NCompass' request and expense, LICENSEE shall provide all reasonable aid and assistance for the defense of any such claims, suits or proceedings; (e) such infringement has not resulted from a combination of the Licensed Material with any other products, processes or material where the alleged infringement relates to such combination (but not, for clarification, where the alleged infringement relates wholly to the Licensed Materials not in combination with any other product, process or material) including, without limitation, the LICENSEE Product; and Page 7 of 15 (f) LICENSEE does not, within a period of time which is commercially reasonable in the circumstances, continue any allegedly infringing activity after being notified thereof or after having been informed of modifications that would have avoided the alleged infringement. In the event that, at any time, LICENSEE or its sublicensees are deprived by a court order of the right to market, distribute or sell the Licensed Material based on a claim that the Licensed Materials infringe upon any patent, copyright, trademark, trade secret or other intellectual property right of a third party, NCompass shall, at its sole expense, use reasonable efforts to: (i) procure on commercially reasonable terms such rights as may be required; or (ii) modify the Licensed Material in a manner sufficient to assure LICENSEE and its sublicensees that they have the right to continue to market, distribute or sell the Licensed Material in the manner contemplated by this Agreement and in such a manner that the modified Licensed Material will substantially conform to the technical specifications of the current Licensed Material, as updated from time to time, without further infringement. If in the reasonable opinion of NCompass such options are not viable, NCompass may terminate this Agreement and refund all fees paid by LICENSEE to NCompass whereupon LICENSEE shall have no further remedies or recourse to NCompass. THE FOREGOING STATES THE SOLE AND EXCLUSIVE LIABILITY OF NCOMPASS FOR PATENT, COPYRIGHT, TRADE SECRET OR OTHER INTELLECTUAL PROPERTY RIGHT INFRINGEMENT FROM ANY THIRD PARTY AND IS IN LIEU OF ANY AND ALL WARRANTIES, EXPRESS OR IMPLIED, OR STATUTORY IN REGARD THERETO. 8.4 LIMITATION OF LIABILITY. EXCEPT FOR A BREACH OF WARRANTY CLAIM WHICH IS COVERED BY ARTICLE 8.1 AND THE REMEDIES AVAILABLE TO LICENSEE UNDER ARTICLE 4.4 IN CONNECTION WITH A NOTICE OF REJECTION PROVIDED BY LICENSEE WITHIN THE ACCEPTANCE PERIOD, NCOMPASS' LIABILITY UNDER, OR FOR BREACH OF, OR ARISING OUT OF THIS AGREEMENT AND/OR THE LICENSE OF THE LICENSED MATERIAL, IS LIMITED TO AN AMOUNT EQUAL TO THE AMOUNT PAID BY LICENSEE UNDER ARTICLE 3.1 OF THIS AGREEMENT. NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY CONSEQUENTIAL (INCLUDING, WITHOUT LIMITATION, LOST PROFITS AND BUSINESS INTERRUPTION), INDIRECT, INCIDENTAL, SPECIAL, ECONOMIC, OR PUNITIVE DAMAGES ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED UNDER THIS AGREEMENT, WHETHER FOR BREACH OR REPUDIATION OF CONTRACT, BREACH OF WARRANTY, NEGLIGENCE OR OTHERWISE, EVEN IF THE OTHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. 8.5 SPECIFIC EXCLUSION OF OTHER WARRANTIES. EXCEPT FOR A BREACH OF WARRANTY CLAIM WHICH IS COVERED BY ARTICLE 8.1 AND THE REMEDIES AVAILABLE TO LICENSEE UNDER ARTICLE 4.4 IN CONNECTION WITH A NOTICE OF REJECTION PROVIDED BY LICENSEE WITHIN THE ACCEPTANCE PERIOD, NCOMPASS MAKES NO OTHER WARRANTIES, REPRESENTATIONS OR GUARANTEES OF ANY KIND WHATSOEVER, EITHER EXPRESS OR IMPLIED WHETHER ARISING BY STATUTE, CONTRACT, TORT, PRODUCT LIABILITY OR OTHERWISE, REGARDING THE LICENSED MATERIAL OR ANY OTHER MATERIALS OR SERVICES TO BE SUPPLIED HEREUNDER BY NCOMPASS, INCLUDING, BUT NOT LIMITED TO, WARRANTIES, REPRESENTATIONS AND GUARANTEES AS TO MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, DESIGN, TITLE, CONDITION OR QUALITY OF THE LICENSED MATERIALS OR OTHER MATERIALS AND SERVICES SUPPLIED BY NCOMPASS HEREUNDER. 8.6 RISK ALLOCATION. THE PROVISIONS OF THIS ARTICLE ALLOCATE THE RISKS BETWEEN THE PARTIES UNDER THIS AGREEMENT. THE FEES PROVIDED FOR IN THIS AGREEMENT REFLECT THIS ALLOCATION OF RISK AND THE LIMITATION OF LIABILITY SPECIFIED HEREIN. Page 8 of 15 9. TERMINATION AND DEFAULT 9.1 TERMINATION. This Agreement may be terminated: (a) by LICENSEE at any time, in which event LICENSEE shall have no liability for future scheduled payments under Article 3.1 hereof; (b) by NCompass in accordance with Article 8.3 of this Agreement; (c) at either party's option if the other party materially defaults in the performance or observance of any of its material obligations under this Agreement and does not remedy the default within 30 days of receiving written demand to do so; (d) by NCompass if LICENSEE fails to pay promptly any amount due and payable under this Agreement; or (e) at either party's option if the other party becomes insolvent or bankrupt or makes an assignment for the benefit of creditors, or if a receiver or trustee in bankruptcy is appointed for the other party, or if any proceeding in bankruptcy, receivership, or liquidation is instituted against the other party and is not dismissed within 30 days. The right of termination will be in addition to all other rights and remedies available for default or wrong doing, for example, either party may seek injunctive relief. When either party has the option to terminate, it may exercise that option by giving the other party written notice of such termination, which will be effective upon receipt. LICENSEE EXPRESSLY WAIVES AND RENOUNCES ANY CLAIM TO COMPENSATION OR INDEMNITIES THAT MAY EXIST UNDER THE LAWS OF ANY APPLICABLE JURISDICTION FOR ANY TERMINATION OF BUSINESS RELATIONSHIP BY A FOREIGN BUSINESS ENTITY EXCEPT FOR THE TERMS DELINEATED IN THIS AGREEMENT. 9.2 EFFECT OF TERMINATION. Upon termination of this Agreement for LICENSEE's material breach, LICENSEE shall cease using, reproducing, marketing, distributing and selling the Licensed Material, shall discontinue all use of any of NCompass' trademarks, and shall not use any other trademarks that are confusingly similar to the NCompass trademarks. NCompass agrees that upon expiration or termination of this Agreement, for any reason other than for a material breach by LICENSEE, LICENSEE may have the right to continue to sublicense and distribute the LICENSEE Products containing the Licensed Materials, as follows: (a) upon the expiry of the term of this Agreement, then for no longer than 30 days thereafter; or (b) upon breach of this Agreement by NCompass, then for no longer than 90 days after the termination date. 9.3 RETURN OF DOCUMENTATION. Except as otherwise provided for in this Agreement, within 30 days of termination of this Agreement, LICENSEE shall, at its own expense, return to NCompass, or certify in writing, that it has destroyed all NCompass documentation in its possession, including, without limitation, all material in its possession or control which contains or refers to any of NCompass' Confidential Information. 9.4 RIGHTS OF END USERS SURVIVE TERMINATION. All end user licenses properly granted by LICENSEE prior to the expiry or termination of this Agreement shall survive any expiry or termination of this Agreement. 9.5 SUBLICENSES. LICENSEE agrees to provide in all of its sublicense agreements with third parties that any rights to further sublicense or distribute the Licensed Material under such agreements will terminate upon termination of this Agreement. All such sublicenses shall contain provisions for the protection of Page 9 of 15 NCompass' rights in the Licensed Material that are no less restrictive than those provisions set forth in Articles 2.1, 6.1, 6.2, 6.3, 6.4 and 10.10 and those provisions for the limitation of liability as set forth in Article 8 of this Agreement. In each jurisdiction in which the Licensed Material is distributed, LICENSEE shall be responsible to ensure that all sublicenses are enforceable and in compliance with the laws of those jurisdictions. LICENSEE shall be solely responsible for, and NCompass shall have no obligation to honor, any warranty or indemnification obligations made by LICENSEE to any sublicensee to the extent that such obligations exceed those of NCompass to LICENSEE under this Agreement. 9.6 TERMINATION OF TECHNICAL SUPPORT SERVICES. In the event that NCompass is unable or unwilling to provide Technical Support Services under Articles 5.1, 5.2 or 5.6 (as applicable) during the period for which the License Fee described in Article 3.1 has been paid in full, then, upon written request by LICENSEE, NCompass shall grant to LICENSEE a non-transferable, non-exclusive limited license to use the Source Code of the Licensed Material for the sole purpose of correcting Bugs, performing the limited fixes and enhancements described in Schedule B hereto and the development of Updates as defined in Article 5.6. This limited license shall terminate on the earlier of; (a) the date of termination or expiry of this Agreement; and (b) the date, if any, upon which NCompass recommences the provision of the Technical Support Services. Notwithstanding any other provision of this Agreement, LICENSEE shall not license to, or permit the use of, the Source Code of the Licensed Material by any other person. LICENSEE acknowledges that the use by LICENSEE of the Source Code of the Licensed Material shall in no event give it or be deemed to give it any legal or equitable, proprietary right, title or interest in and to such Bug corrections, fixes, enhancements and Updates resulting therefrom, except for LICENSEE's right to use the same solely as provided in this Agreement. 10. GENERAL PROVISIONS 10.1 AMENDMENT. This Agreement shall not be subject to amendment, modification or discharge in whole or in part except by written instrument signed by NCompass and LICENSEE. Any and all riders or endorsements attached to this Agreement and signed by the parties hereto shall have the same force and effect as if incorporated into the numbered terms and provisions of this Agreement. 10.2 ASSIGNMENT. LICENSEE and NCompass may not assign this Agreement in whole or in part, except with the prior written consent of the other, such consent not to be unreasonably withheld. LICENSEE may not delegate its authority hereunder without the prior written consent of NCompass. Notwithstanding the foregoing, either party may assign its interest in this Agreement without the prior written consent of the other party, if such assignment is to a third party that is acquiring substantially all of the assignee's business assets or stock. 10.3 CORPORATE AUTHORITY. The persons executing this Agreement covenant and warrant that they have the right, power, legal capacity, and appropriate corporate authority to enter into this Agreement on behalf of the corporation for which they sign below. 10.4 COUNTERPARTS. This Agreement may be executed in counterparts with the same effect as if both parties had signed the same document. Both counterparts shall be construed together and shall constitute one and the same agreement. This Agreement may be executed by the parties and transmitted by facsimile transmission and if so executed and transmitted this Agreement shall be for all purposes as effective as if the parties had delivered an executed original Agreement. 10.5 ENTIRE AGREEMENT. This Agreement supersedes all prior agreements and understandings between the parties about its subject matter and is the entire agreement between the parties in respect to the Licensed Material. This Agreement may not be amended except by written agreement signed by both parties. Page 10 of 15 10.6 ENUREMENT. This Agreement shall be binding upon and enure to the benefit of the parties, and their successors and permitted assigns. 10.7 FURTHER ASSURANCES. NCompass and LICENSEE shall both execute and deliver such further instruments and do such further acts as may be required to implement the intent of this Agreement. 10.8 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the Province of British Columbia, and the parties hereto irrevocably submit to the jurisdiction of the courts of such province. In any action or suit to enforce any right or remedy under this Agreement or to interpret any provision of this Agreement, the prevailing party shall be entitled to recover its costs, including reasonable attorneys' fees. 10.9 INDEPENDENT CONTRACTORS. The parties are independent contractors. No employment, partnership, joint venture or agency relationship is created by this Agreement and one party cannot commit the other. 10.10 EXPORT LAWS. LICENSEE shall comply with the U.S. Foreign Corrupt Practices Act and all export laws, restrictions and regulations of the Department of Commerce or other United States or foreign agency or authority and will not export or allow the export of any Licensed Material in violation of any such restrictions, laws or regulations. 10.11 FORCE MAJEURE. Neither party shall be liable for its failure to perform any of its obligations hereunder (other than failure to make any payments when due hereunder) during any period in which performance is prevented, interrupted or delayed by fire, flood, war, embargo, riot, the intervention of any government authority, shortages of labor, materials or delay in transportation beyond the reasonable control of the party expecting same (each a "Force Majeure"), except that lack of funds or credit shall not constitute a Force Majeure. The party suffering such Force Majeure shall immediately notify the other party of the Force Majeure. 10.12 NOTICE. Any notice or other communication, except a notice of termination or default, required or permitted to be given under this Agreement may be delivered personally or be sent by first class mail, postage prepaid, or by overnight courier to LICENSEE or NCompass at the address indicated on page one hereof, and any such notice or other communication shall be deemed to have been given to the party to whom it was addressed and received by that party on delivery, if delivered personally, and on the fifth business day following the mailing thereof, if mailed. Either party may change the address to which notice is to be given as provided herein. A notice of termination or default shall be sent by registered mail, return receipt requested. 10.13 SEVERABILITY. If any provision of this Agreement is held unenforceable by a court of competent jurisdiction for any reason whatsoever, the unenforceability shall not affect the enforceability of the remaining provisions of this Agreement and the unenforceable or invalid provision shall be severable from the remainder of this Agreement. 10.14 SURVIVAL. Articles 6.2, 8.3, 9.2, 9.3 and 9.4 shall survive termination of this Agreement. 10.15 WAIVER. No notice of waiver of any term of this Agreement will be effective unless in writing signed by the party making such waiver and no waiver of any breach will constitute a waiver of any subsequent or continuing breach. The failure of either party to assert any claim in timely fashion will not alter or restrict any such party's fight to assert any claim for a subsequent breach. 10.16 HEADINGS. The section headings appearing in this Agreement are inserted only as a matter of convenience and in no way define, limit, construe or describe the scope or intent of any such section nor in any way effect this Agreement. Page 11 of 15 IN WITNESS WHEREOF, the parties hereto have entered into this Agreement as of the date first above written. NCOMPASS LABS INC. by its authorized signatory: /s/ /Dane Chauvel December 3, 1998 - ------------------------------------ ------------------------------------ Dane Chauvel Date Chief Financial Officer COMPS INFOSYSTEMS, INC. by its authorized signatory: /s/ Bob Evatt 12/2/98 - ------------------------------------ ------------------------------------ Name: Bob Evatt Date Title: AVP, PRODUCT DEVELOPMENT Page 12 of 15 SCHEDULE A LICENSED MATERIAL SPECIFICATIONS MODIFIED VERSION OF THE NCOMPASS SCRIPTACTIVE(TM) PLUG-IN VERSION 2.9.0.5 PLATFORMS SUPPORTED Runs under Windows(TM) NT 4.0 and Windows(TM) 95. Works with Netscape Navigator(TM) 3.0, 3.01, 3.02, 3.03 and 3.04 and Communicator(TM) 4.0, 4.01, 4.02, 4.03, 4.04, 4.05 and 4.06. ARCHITECTURE Written using Visual C++ 5.0 with Service Pack 3. FUNCTIONALITY Supports the ActiveX framework, including ActiveX Controls and ActiveX Scripting through VBScript. Supports signed ActiveX Controls. Contains the NCompass Conversion Tool which is used to modify Internet Explorer specific HTML files to a format compatible with the Netscape browser. Page 13 of 15 SCHEDULE B TECHNICAL SUPPORT SERVICES NCompass shall: 1. promptly provide LICENSEE written notice of known Bugs found in the Licensed Material; and 2. upon receipt of notice from LICENSEE of a Bug, in sufficient detail to permit NCompass to identify the Bug, provide to LICENSEE one of the following solutions, such choice to be at the discretion of NCompass: (a) an existing correction to the Licensed Material, (b) a new correction to the Licensed Material, (c) a request for more information regarding the Bug, or (d) a report explaining how and when NCompass plans to address the Bug; and 3. make reasonable efforts to resolve Bugs within its control in the Licensed Material within a reasonable period of time; and 4. use its best efforts to remedy the error or Bug as soon as is feasible if an error or Bug occurs in the Licensed Materials which renders the Licensed Materials or the LICENSEE Product inoperable. NCompass shall ship Updates to LICENSEE when they become available and such releases will list the Bug fixes and enhancements. NCompass shall provide the Technical Support Services to LICENSEE by telephone, e-mail, facsimile or mail between the regular business hours of 8:30 AM (PST) and 5:30 PM (PST). Page 14 of 15 SCHEDULE C NCOMPASS GUIDELINES FOR PROPRIETARY NOTICES AND DEVICES 1 All trademarks that do not use designs must be presented as follows: NCOMPASS 2 The symbol TM should appear beside all trademarks on the right shoulder of the trademarks, unless there is a good reason for not doing so. By way of example: NCOMPASS(TM) 3 A legend or footnote should appear where the trademark is used reading: (TM) denotes trademarks of NCompass Labs Inc., used under license by USER. This type of system requires fairly extensive usage of the symbol (TM) in the material to which the footnote refers. If that is not possible, the symbol can be used only with the first appearance of each trademark, or asterisks can be used, or a statement similar to the following can be used: NCOMPASS is a trademark of NCompass Labs Inc., used under license by USER. 4 After a trademark is registered in the United States Patent and Trademark Office, when that trademark is used, the (TM) symbol will be replaced by the (R) symbol for all of the foregoing purposes. 5 All written and graphic material bearing the trademarks, including print advertising, should bear a copyright notice consisting of all the following components: (a) the symbol (C); (b) the name NCompass Labs Inc.; and (c) the year that copies of the subject material is first published by distribution of copies to the public. By way of example, if an item is first published in the year 1998, an appropriate notice would be: "(C) NCompass Labs Inc. 1998". Page 15 of 15 EX-10.27 32 AMENDED & RESTATED STOCK OPTION PLAN EXHIBIT 10.27 AMENDED AND RESTATED STOCK OPTION PLAN OF COMPS INFOSYSTEMS, INC. COMPS InfoSystems, Inc., a corporation organized under the laws of the State of Delaware, hereby adopts this Stock Option Plan of COMPS InfoSystems, Inc. The purposes of this Plan are as follows: (1) To further the growth, development and financial success of the Company by providing additional incentives to certain of its executive and other key Employees who have been or will be given responsibility for the management or administration of the Company's business affairs, by assisting them to become owners of the Company's Class B non-voting Common Stock and thus to benefit directly from its growth, development and financial success. (2) To enable the Company to obtain and retain the services of the type of professional, technical and managerial Employees, consultants and independent contractors considered essential to the long-range success of the Company by providing and offering them an opportunity, to become owners of the Company's Class B non-voting Common Stock under options, including options (in the case of Employees), that are intended to qualify as "incentive stock options" under Section 422 of the Code. 1 DEFINITIONS ----------- Whenever the following terms are used in this Plan, they shall have the meaning specified below unless the context clearly indicates to the contrary. The masculine pronoun shall include the feminine and neuter and the singular shall include the plural, where the context so indicates. 1.1 - Administrator - --- ------------- "Administrator" shall have the meaning set forth in Section 6. 1 (b). 1.2 - Board - --- ----- "Board" shall mean the Board of Directors of the Company. 1.3 - Code - --- ---- "Code" shall mean the Internal Revenue Code of 1986, as amended. 1.4 - Committee - --- --------- "Committee" shall mean the Stock Option Committee of the Board, appointed as provided in Section 6. 1. 1.5 - Company - --- ------- "Company" shall mean COMPS InfoSystems, Inc. 1.6 - Director - --- -------- "Director" shall mean a member of the Board. 1.7 - Employee - --- -------- "Employee" shall mean any employee (as defined in accordance with the regulations and revenue rulings then applicable under Section 3401(c) of the Code) of the Company, or of any corporation which is then a Parent Corporation or a Subsidiary, whether such employee is so employed at the time this Plan is adopted or becomes so employed subsequent to the adoption of this Plan. 1.8 - Exchange Act - --- ------------ "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. 1.9 - Initial Public Offering - --- ----------------------- "Initial Public Offering" shall mean the closing of the sale of the Company's securities pursuant to an underwritten public offering. 1.10 - Incentive Stock Option - ---- ---------------------- "Incentive Stock Option" shall mean an Option which qualifies under Section 422 of the Code and which is designated as an Incentive Stock Option by the Administrator. 1.11 - Non-Qualified Option - ---- -------------------- "Non-Qualified Option" shall mean an Option which is not an Incentive Stock Option and which is designated as a Non-Qualified Option by the Administrator. 1.12 - Officer - ---- ------- "Officer" shall mean an officer of the Company, as defined in Rule 16a-l(f) under the Exchange Act, as such Rule may be amended in the future. 2 1.13 - Option - ---- ------ "Option" shall mean an option to purchase Class B non-voting Common Stock of the Company, granted under the Plan. "Options" includes both Incentive Stock Options and Non-Qualified Options. 1.14 - Optionee - ---- -------- "Optionee" shall mean an Employee or other individual to whom an Option is granted under the Plan. 1.15 - Parent Corporation - ---- ------------------ "Parent Corporation" shall mean any corporation in an unbroken chain of corporations ending with the Company if each of the corporations other than the Company then owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 1.16 - Plan - ---- ---- "Plan" shall mean this Stock Option Plan of COMPS InfoSystems, Inc. 1.17 - Rule 16b-3 - ---- ---------- "Rule 16b-3" shall mean that certain Rule 16b-3 under the Exchange Act, as such Rule may be amended in the future. 1.18 - Secretary - ---- --------- "Secretary" shall mean the Secretary of the Company. 1.19 - Securities Act - ---- -------------- "Securities Act" shall mean the Securities Act of 1933, as amended. 1.20 - Subsidiary - ---- ---------- "Subsidiary" shall mean any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain then owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 1.21 - Termination of Employment - ---- ------------------------- "Termination of Employment" shall mean the time when the employee- employer relationship between the Optionee and the Company, a Parent Corporation or a Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, a termination by resignation, discharge, death or retirement, but excluding terminations where there is a simultaneous reemployment by the Company, a Parent Corporation or a Subsidiary. 3 The Administrator in its absolute discretion, shall determine the effect of all other matters and questions relating to Termination of Employment, including, but not by way of limitation, the question of whether a Termination of Employment resulted from a discharge for good cause, and all questions of whether particular leaves of absence constitute Terminations of Employment; provided, however, that, with respect to Incentive Stock Options, a leave of absence shall constitute a Termination of Employment if, and to the extent that, such leave of absence interrupts employment for the purposes of Section 422(a)(2) of the Code and the then applicable regulations and revenue rulings under said Section. 1.22 - Termination of Business Relationship - ---- ------------------------------------ "Termination of Business Relationship" shall mean the time when the business relationship between the Optionee and the Company, a Parent Corporation or a Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, a termination by cessation of business, bankruptcy, contract termination, resignation, discharge or death. The Administrator, in its absolution discretion, shall determine the effect of all other matters and questions relating to Termination of Business Relationship. 2 SHARES SUBJECT TO PLAN ---------------------- 2.1 - Shares Subject to Plan - --- ---------------------- The shares of stock subject to Options shall be shares of the Company's $.0l par value non-voting Class B Common Stock (the "Common Stock"). The aggregate number of such shares which may be issued upon exercise of Options shall not exceed 1,719,909. The number of such shares which may be issued upon exercise of Options granted to any single Optionee shall not exceed 300,000. 2.2 - Unexercised Options - --- ------------------- If any Option expires or is cancelled without having been fully exercised, the number of shares subject to such Option but as to which such Option was not exercised prior to its expiration or cancellation may again be optioned hereunder, subject to the limitations of Section 2.1. 2.3 - Changes in Company's Shares - --- --------------------------- In the event that the outstanding shares of Common Stock of the Company are hereafter changed into or exchanged for a different number or kind of shares or other securities of the Company, or of another corporation, by reason of reorganization, merger, consolidation, recapitalization, reclassification, stock split-up, stock dividend or combination of shares, appropriate adjustments shall be made by the Administrator in the number and kind of shares for the purchase of which Options may be granted, including adjustments of the limitations in Section 2.1 on the maximum number and kind of shares which may be issued on exercise of Options. 4 3 GRANTING OF OPTIONS ------------------- 3.1 - Eligibility - --- ----------- Any executive or other key Employee of the Company or of any corporation which is then a Parent Corporation or a Subsidiary shall be eligible to be granted Options. except as provided in Section 3.2. In addition, any individual maintaining a significant business relationship with the Company or a Subsidiary shall be eligible to be granted a Non-Qualified Option. 3.2 - Qualification of Incentive Stock Options - --- ---------------------------------------- No Incentive Stock Option shall be granted unless such Option, when granted, qualifies as an "incentive stock option" under Section 422 of the Code. Only Employees may be granted Incentive Stock Options. 3.3 - Granting of Options - --- ------------------- (a) The Administrator shall from time to time, in its absolute discretion: (i) Determine which Employees are executive or other key Employees; (ii) Determine which individuals maintain a significant business relationship with the Company or a Subsidiary; (iii) Select from among the executive or other key Employees and other individuals (including those to whom Options have been previously granted under the Plan) such of them as in its opinion should be granted Options; and (iv) Determine the number of shares to be subject to such Options granted to such selected executive or other key Employees and other individuals, and determine (in the case of Employees) whether such Options are to be Incentive Stock Options or Non-Qualified Options; and (v) Determine the terms and conditions of such Options, consistent with the Plan. (b) Upon the selection of an executive or other key Employee or other individual to be granted an Option, the Administrator shall instruct the Secretary to issue such Option and may impose such conditions on the grant of such Option as it deems appropriate. Without limiting the generality of the preceding sentence, the Administrator may, in its discretion and on such terms as it deems appropriate, require as a condition on the grant of an Option to an Employee or other individuals that the Employee or other individual surrender for cancellation some or all of the unexercised Options which have been previously granted to him. An Option the grant of which is conditioned upon such surrender may have an option price lower (or higher) than the option price of the surrendered Option, may cover the same (or a lesser or greater) number of 5 shares as the surrendered Option, may contain such other terms as the Administrator deems appropriate and shall be exercisable in accordance with its terms, without regard to the number of shares, price, option period or any other term or condition of the surrendered Option. 4 TERMS OF OPTIONS ---------------- 4.1 - Option Agreement - --- ---------------- Each Option shall be evidenced by a written Stock Option Agreement, which shall be executed by the Optionee and an authorized Officer of the Company and which shall contain such terms and conditions as the Administrator shall determine, consistent with the Plan. Stock Option Agreements evidencing Incentive Stock Options shall contain such terms and conditions as may be necessary to qualify such Options as "incentive stock options" under Section 422 of the Code. 4.2 - Option Price - --- ------------ (a) The price of the shares subject to each Option shall be set by the Administrator; provided, however, that the price per share shall be not less than 100% of the fair market value of such shares on the date such Option is granted; provided, further, that, in the case of an Incentive Stock Option, the price per share shall not be less than 110% of the fair market value of such shares on the date such Option is granted in the case of an individual then owning (within the meaning of Section 424(d) of the Code) more than 10% of the total combined voting power of all classes of stock of the Company, any Subsidiary or any Parent Corporation. (b) For purposes of the Plan, the fair market value of a share of the Company's Common Stock as of a given date shall be: (i) the closing price of a share of the Company's Common Stock on the principal exchange on which shares of the Company's Common Stock are then trading, if any, on the trading day previous to such date, or, if shares were not traded on the day previous to such date, then on the next preceding trading day during which a sale occurred; or (ii) if such Common Stock is not traded on an exchange but is quoted on Nasdaq or a successor quotation system, (1) the last sales price (if the Company's Common Stock is then listed as a National Market Issue under the Nasdaq National Market) or (2) the mean between the closing representative bid and asked prices (in all other cases) for the Company's Common Stock on the trading day previous to such date as reported by Nasdaq or such successor quotation system; or (iii) if such Common Stock is not publicly traded on an exchange and not quoted on Nasdaq or a successor quotation system, the mean between the closing bid and asked prices for the Company's Common Stock, on the trading day previous to such date, as determined in good faith by the Administrator; or (iv) if the Company's Common Stock is not publicly traded, the fair market value established by the Administrator acting in good faith or as otherwise provided in an agreement evidencing an Option. 6 4.3 - Commencement of Exercisability - --- ------------------------------ (a) Except as the Administrator may otherwise provide with respect to Options granted to Optionees who are not Officers, no Option may be exercised in whole or in part during the first year after such Option is granted. (b) Subject to the provisions of Sections 4.3(a), 4.3(c), 4.3(d), and 7.3, Options shall become exercisable at such times and in such installments (which may be cumulative) as the Administrator shall provide in the terms of each individual Option; provided, however, that by a resolution adopted after an Option is granted the Committee may, on such terms and conditions as it may determine to be appropriate and subject to Sections 4.3(a), 4.3(c), 4.3(d), and 7.3, accelerate the time at which such Option or any portion thereof may be exercised. (c) No portion of an Option which is unexercisable at Termination of Employment or Termination of Business Relationship, as the case may be, shall thereafter become exercisable. (d) Notwithstanding any other provision of this Plan, in the case of an Incentive Stock Option, the aggregate fair market value (determined at the time the Incentive Stock Option is granted) of the shares of the Company's stock with respect to which "incentive stock options" (within the meaning of Section 422 of the Code) are exercisable for the first time by the Optionee during any calendar year (under the Plan and all other incentive stock option plans of the Company, any Subsidiary and any Parent Corporation) shall not exceed $100,000. 4.4 - Expiration of Options - --- --------------------- (a) No Option may be exercised to any extent by anyone after the first to occur of the following events: (i) The expiration of ten years from the date the Option was granted; or (ii) With respect to an Incentive Stock Option in the case of an Optionee owning (within the meaning of Section 424(d) of the Code), at the time the Incentive Stock Option was granted, more than 10% of the total combined voting power of all classes of stock of the Company, any Subsidiary or any Parent Corporation, the expiration of five years from the date the Incentive Stock Option was granted; or (iii) Except in the case of any Optionee who is disabled (within the meaning of Section 22(e)(3) of the Code), the expiration of three months from the date of the Optionee's Termination of Employment or Termination of Business Relationship, as the case may be, for any reason other than such Optionee's death unless the Optionee dies within said three-month period; or (iv) In the case of an Optionee who is disabled (within the meaning of Section 22(e)(3) of the Code), the expiration of one year from the date of the Optionee's Termination of Employment or Termination of Business Relationship, as the case may 7 be, for any reason other than such Optionee's death unless the Optionee dies within said one-year period; or (v) The expiration of one year from the date of the Optionee's death. (b) Subject to the provisions of Section 4.4(a), the Administrator shall provide, in the terms of each individual Option, when such Option expires and becomes unexercisable; and (without limiting the generality of the foregoing) the Administrator may provide in the terms of individual Options that said Options expire immediately upon a Termination of Employment for any reason. 4.5 - Consideration - --- ------------- In consideration of the granting of an Option. the Optionee shall agree, in the written Stock Option Agreement, to remain in the employ or in a business relationship with of the Company, a Parent Corporation or a Subsidiary for a period of at least one year after the Option is granted. Nothing in this Plan or in any Stock Option Agreement hereunder shall confer upon any Optionee any right to continue in the employ of or in a business relationship with the Company, any Parent Corporation or any Subsidiary or shall interfere with or restrict in any way the rights of the Company, its Parent Corporations and its Subsidiaries, which are hereby expressly reserved, to discharge or to terminate the business relationship with, any Optionee at any time for any reason whatsoever, with or without cause. 4.6 - Adjustments in Outstanding Options - --- ---------------------------------- In the event that the outstanding shares of the stock subject to Options are changed into or exchanged for a different number or kind of shares of the Company or other securities of the Company by reason of merger, consolidation, recapitalization, reclassification, stock split-up, stock dividend or combination of shares, the Administrator shall make an appropriate and equitable adjustment in the number and kind of shares as to which all outstanding Options, or portions thereof then unexercised, shall be exercisable, to the end that after such event the Optionee's proportionate interest shall be maintained as before the occurrence of such event. Such adjustment in an outstanding Option shall be made without change in the total price applicable to the Option or the unexercised portion of the Option (except for any change in the aggregate price resulting from rounding-off of share quantities or prices) and with any necessary corresponding adjustment in Option price per share; provided, however, that, in the case of Incentive Stock Options, each such adjustment shall be made in such manner as not to constitute a "modification" within the meaning of Section 424(h)(3) of the Code. Any such adjustment made by the Administrator shall be final and binding upon all Optionees, the Company and all other interested persons. 4.7 - Merger, Consolidation, Acquisition, Liquidation or Dissolution - --- -------------------------------------------------------------- Notwithstanding the provisions of Section 4.6, in its absolute discretion, and on such terms and conditions as it deems appropriate, the Administrator may provide by the terms of any Option that such Option cannot be exercised after the merger or consolidation of the Company with or into another corporation, the acquisition by another corporation or person of all or substantially all of the Company's assets or 80% or more of the Company's then outstanding 8 voting stock or the liquidation or dissolution of the Company; and if the Administrator so provides, it may, in its absolute discretion and on such terms and conditions as it deems appropriate, also provide, either by the terms of such Option or by a resolution adopted prior to the occurrence of such merger, consolidation, acquisition, liquidation or dissolution, that, for some period of time prior to such event, such Option shall be exercisable as to all shares covered thereby, notwithstanding anything to the contrary in Section 4.3(a), Section 4.3(b), and/or any installment provisions of such Option, but subject to Section 4.3(d). 5 EXERCISE OF OPTIONS ------------------- 5.1 - Person Eligible to Exercise - --- --------------------------- During the lifetime of the Optionee, only the Optionee may exercise an Option (or any portion thereof) granted to the Optionee. After the death of the Optionee, any exercisable portion of an Option may, prior to the time when such portion becomes unexercisable under the Plan or the applicable Stock Option Agreement, be exercised by the Optionee's personal representative or by any person empowered to do so under the deceased Optionee's will or under the then applicable laws of descent and distribution. 5.2 - Partial Exercise - --- ---------------- At any time and from time to time prior to the time when any exercisable Option or exercisable portion thereof becomes unexercisable under the Plan or the applicable Stock Option Agreement, such Option or portion thereof may be exercised in whole or in part; provided, however, that the Company shall not be required to issue fractional shares and the Administrator may, by the terms of the Option, require any partial exercise to be with respect to a specified minimum number of shares. 5.3 - Manner of Exercise - --- ------------------ An exercisable Option, or any exercisable portion thereof, may be exercised solely by delivery to the Secretary or his office of all of the following prior to the time when such Option or such portion becomes unexercisable under the Plan or the applicable Stock Option Agreement: (a) Notice in writing signed by the Optionee or other person then entitled to exercise such Option or portion, stating that such Option or portion is exercised, such notice complying with all applicable rules established by the Administrator; and (i) Full payment (by cashier's check or wire transfer) for the shares with respect to which such Option or portion is thereby exercised; or (ii) With the consent of the Administrator, (A) shares of the Company's Common Stock owned by the Optionee duly endorsed for transfer to the Company or (B) subject to the timing requirements of Section 5.4, shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option, with a fair market value (as 9 determined under Section 4.2(b)) on the date of Option exercise equal to the aggregate Option price of the shares with respect to which such Option or portion is thereby exercised; or (iii) With the consent of the Administrator, a promissory note bearing interest (at no less than such rate as shall then preclude the imputation of interest under the Code or successor provision) and payable upon such terms as may be prescribed by the Administrator. The Administrator may also prescribe the form of such note and the security to be given for such note. `The Option may not be exercised, however, by delivery of a promissory note or by a loan from the Company when or where such loan or other extension of credit is prohibited by law; or (iv) With the consent of the Administrator, any combination of the consideration provided in the foregoing subsections (i), (ii) and (iii); and (b) The payment to the Company (or other corporation) of all amounts which it is required to withhold under federal, state or local law in connection with the exercise of the Option; with the consent of the Committee, (i) shares of the Company's Common Stock owned by the Optionee duly endorsed for transfer or (ii) except with respect to Incentive Stock Options and subject to the timing requirements of Section 5.4, shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option, valued in accordance with Section 4.2(b) at the date of Option exercise, may be used to make all or part of such payment; (c) Such representations and documents as the Administrator, in its absolute discretion, deems necessary or advisable to effect compliance with all applicable provisions of the Securities Act and any other federal or state securities laws or regulations. The Administrator may, in its absolute discretion, also take whatever additional actions it deems appropriate to effect such compliance including, without limitation, placing legends on share certificates and issuing stop-transfer orders to transfer agents and registrars; and (d) In the event that the Option or portion thereof shall be exercised pursuant to Section 5.1 by any person or persons other than the Optionee, appropriate proof of the right of such person or persons to exercise the Option or portion thereof. 5.4 - Certain Timing Requirements - --- --------------------------- Shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option may be used to satisfy the Option price or the tax withholding consequences of such exercise only (i) during the period beginning on the third business day following the date of release of the quarterly or annual summary statement of sales and earnings of the Company and ending on the twelfth business day following such date or (ii) pursuant to an irrevocable written election by the Optionee to use shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option to pay all or part of the Option price or the withholding taxes (subject to the approval of the Administrator) made at least six months prior to the payment of such Option price or withholding taxes. 10 5.5 - Conditions to Issuance of Stock Certificates - --- -------------------------------------------- The shares of stock issuable and deliverable upon the exercise of an Option, or any portion thereof, may be either previously authorized but unissued shares or issued shares which have then been reacquired by the Company. The Company shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of any Option or portion thereof prior to fulfillment of all of the following conditions: (a) The obtaining of any approval or other clearance from any state or federal governmental agency which the Committee shall, in its absolute discretion, determine to be necessary or advisable; and (b) The payment to the Company (or other employer corporation) of all amounts which it is required to withhold under federal, state or local law in connection with the exercise of the Option; and (c) The lapse of such reasonable period of time following the exercise of the Option as the Administrator may establish from time to time for reasons of administrative convenience. 5.6 - Rights as Shareholders - --- ---------------------- The holders of Options shall not be, nor have any of the rights or privileges of, shareholders of the Company in respect of any shares purchasable upon the exercise of any part of an Option unless and until certificates representing such shares have been issued by the Company to such holders. 5.7 - Transfer Restrictions - --- --------------------- Unless otherwise approved in writing by the Administrator, no shares acquired upon exercise of any Option by any Officer may be sold, assigned, pledged, encumbered or otherwise transferred until at least six months have elapsed from (but excluding) the date that such Option was granted. The Administrator, in its absolute discretion, may impose such other restrictions on the transferability of the shares purchasable upon the exercise of an Option as it deems appropriate. Any such other restriction shall be set forth in the respective Stock Option Agreement and may be referred to on the certificates evidencing such shares. The Administrator may require the Optionee to give the Company prompt notice of any disposition of shares of stock, acquired by exercise of an Incentive Stock Option, within two years from the date of granting such Option or one year after the transfer of such shares to such Employee. The Administrator may direct that the certificates evidencing shares acquired by exercise of an Incentive Stock Option refer to such requirement to give prompt notice of disposition. 11 6 ADMINISTRATION -------------- 6.1 - Administration by Board or Stock Option Committee - --- ------------------------------------------------- (a) The Plan shall be administered by the Administrator. (b) Prior to the Initial Public Offering, the Administrator shall be the Board, or, in the sole and absolute discretion of the Board, the Committee. After the Initial Public Offering, the Administrator shall be the Committee. (c) The Stock Option Committee shall consist of two or more Directors, appointed by and holding office at the pleasure of the Board, each of whom is both (a) a "disinterested person" as defined by Rule 16b-3 and (b) an "outside director" within the meaning of Section 162(m)(4)(C)(ii) of the Code. Appointment of Committee members shall be effective upon acceptance of appointment. Committee members may resign at any time by delivering written notice to the Board. Vacancies in the Committee shall be filled by the Board. 6.2 - Duties and Powers of Administrator - --- ---------------------------------- It shall be the duty of the Administrator to conduct the general administration of the Plan in accordance with its provisions. The Administrator shall have the power to interpret the Plan and the Options and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret, amend or revoke any such rules. Any such interpretations and rules in regard to Incentive Stock Options shall be consistent with the basic purpose of the Plan to grant "incentive stock options" within the meaning of Section 422 of the Code. In the event that the Administrator is the Committee, the Board shall have no right to exercise any of the rights or duties of the Committee under the Plan. 6.3 - Majority Rule - --- ------------- The Administrator shall act by (a) a majority of the members of the Board, if the Board is the Administrator; or (b) a majority of the members of the Committee, if the Committee is the Administrator. The Committee may act either by vote at a meeting or by a memorandum or other written instrument signed by a majority of the Committee. 6.4 - Compensation; Professional Assistance; Good Faith Actions - --- --------------------------------------------------------- Members of the Administrator shall receive such compensation for their services as members as may be determined by the Board. All expenses and liabilities incurred by members of the Administrator in connection with the administration of the Plan shall be borne by the Company. The Administrator may employ attorneys, consultants, accountants, appraisers, brokers or other persons. The Administrator the Company and its Officers and Directors shall be entitled to rely upon the advice, opinions or valuations of any such persons. All actions taken and all interpretations and determinations made by the Administrator in good faith shall be final and binding upon all Optionees, the Company and all other interested persons. No member of the Administrator shall be personally liable for any action, determination or interpretation made 12 in good faith with respect to the Plan or the Options, and all members of the Administrator shall be fully protected by the Company in respect to any such action, determination or interpretation. 7 OTHER PROVISIONS ---------------- 7.1 - Options Not Transferable - --- ------------------------ No Option or interest or right therein or part thereof shall be liable for the debts, contracts or engagements of the Optionee or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect; provided, however, that nothing in this Section 7.1 shall prevent transfers by will or by the applicable laws of descent and distribution. 7.2 - Amendment, Suspension or Termination of the Plan - --- ------------------------------------------------ The Plan may be wholly or partially amended or otherwise modified, suspended or terminated at any time or from time to time by the Administrator. However, without approval of the Company's shareholders given within 12 months before or after the action by the Administrator, no action of the Administrator may, except as provided in Section 2.3, increase any limit imposed in Section 2.1 on the maximum number of shares which may be issued on exercise of Options, materially modify the eligibility requirements of Section 3.1, reduce the minimum Option price requirements of Section 4.2(a) or extend the limit imposed in this Section 7.2 on the period during which Options may be granted or amend or modify the Plan in a manner requiring shareholder approval under Rule 16b-3. Neither the amendment, suspension nor termination of the Plan shall, without the consent of the holder of the Option, impair any rights or obligations under any Option theretofore granted. No Option may be granted during any period of suspension nor after termination of the Plan, and in no event may any Option be granted under this Plan after the first to occur of the following events: (a) The expiration of ten years from the date the Plan is adopted by the Board; or (b) The expiration of ten years from the date the Plan is approved by the Company's shareholders under Section 7.3. 7.3 - Approval of Plan by Shareholders - --- -------------------------------- This Plan will be submitted for the approval of the Company's shareholders within 12 months after the date of the Board's initial adoption of the Plan. Options may be granted prior to such shareholder approval; provided, however, that such Options shall not be exercisable prior to the time when the Plan is approved by the shareholders; provided, further, that if such approval has not been obtained at the end of said 12-month period, all Options previously granted under the Plan shall thereupon be cancelled and become null and void. The 13 Company shall take such actions with respect to the Plan as may be necessary to satisfy the requirements of Rule 16b-3(b). 7.4 - Effect of Plan Upon Other Option and Compensation Plans - --- ------------------------------------------------------- The adoption of this Plan shall not affect any other compensation or incentive plans in effect for the Company, any Parent Corporation or any Subsidiary. Nothing in this Plan shall be construed to limit the right of the Company, any Parent Corporation or any Subsidiary (a) to establish any other forms of incentives or compensation for employees of the Company, any Parent Corporation or any Subsidiary or (b) to grant or assume options otherwise than under this Plan in connection with any proper corporate purpose, including, but not by way of limitation, the grant or assumption of options in connection with the acquisition by purchase, lease, merger, consolidation or otherwise, of the business, stock or assets of any corporation, firm or association. 7.5 - Titles - --- ------ Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of the Plan. 7.6 - Conformity to Securities Laws - --- ----------------------------- The Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, including without limitation Rule 16b-3. Notwithstanding anything herein to the contrary, the Plan shall be administered, and Options shall be granted and may be exercised, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and Options granted hereunder shall be deemed amended to the extent necessary to conform to such laws, rules and regulations. 14 * * * * * I hereby certify that the foregoing Plan was duly adopted by the Board of Directors of COMPS InfoSystems, Inc. on January 30, 1997. Executed effective August 6, 1996. /s/ Robert C. Beasley ------------------------------------- Secretary * * * * I hereby certify that the foregoing Plan was duly approved by the shareholders of COMPS InfoSystems, Inc. on January 30, 1997. Executed effective August 6, 1996. /s/ Robert C. Beasley ------------------------------------- Secretary 15 EX-10.28 33 FORM OF STOCK OPTION PLAN FORM EXHIBIT 10.28 FORM OF INCENTIVE STOCK OPTION AGREEMENT ---------------------------------------- THIS AGREEMENT, dated ___________, 1997 is made by and between COMPS InfoSystems, Inc., a Delaware corporation hereinafter referred to as "Company," and ___________, an employee of the Company or a Parent Corporation or Subsidiary of the Company, hereinafter referred to as "Employee" or "Optionee": WHEREAS, the Company wishes to afford the Employee the opportunity to purchase shares of its $.0l par value non-voting Class B Common Stock; and WHEREAS, the Company wishes to carry out the Plan (the terms of which are hereby incorporated by reference and made a part of this Agreement); and WHEREAS, the Administrator, appointed to administer the Plan, has determined that it would be to the advantage and best interest of the Company and its shareholders to grant the Incentive Stock Option provided for herein to the Employee as an inducement to perform future services for the Company, its Parent Corporations or its Subsidiaries and as an incentive for increased efforts during such service, and has advised the Company thereof and instructed the undersigned officers to issue said Option; NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows: 1 DEFINITIONS ----------- Whenever the following terms are used in this Agreement, they shall have the meaning specified below unless the context clearly indicates to the contrary. The masculine pronoun shall include the feminine and neuter, and the singular the plural, where the context so indicates. 1.1 - Administrator - --- ------------- "Administrator" shall mean: (a) prior to the Initial Public Offering, the Board, or, in the sole and absolute discretion of the Board, the Committee; and (b) after the Initial Public Offering, the Committee. 1.2 - Board - --- ----- "Board" shall mean the Board of Directors of the Company. 1.3 - Code - --- ---- "Code" shall mean the Internal Revenue Code of 1986, as amended. 1.4 - Committee - --- --------- "Committee" shall mean the Stock Option Committee of the Board, appointed as provided in the Plan. 1.5 - Common Stock - --- ------------ "Common Stock" shall mean the Company's non-voting Class B Common Stock, par value $.0l per share. 1.6 - Company - --- ------- "Company" shall mean COMPS InfoSystems, Inc. 1.7 - Director - --- -------- "Director" shall mean a member of the Board. 1.8 - Exchange Act - --- ------------ "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. 1.9 - Initial Public Offering - --- ----------------------- "Initial Public Offering" shall mean the closing of the sale of the Company's securities pursuant to an underwritten public offering. 1.10 - Officer - ---- ------- "Officer" shall mean an officer of the Company, as defined in Rule 16a-l(f) under the Exchange Act, as such Rule may be amended in the future. 1.11 - Option - ---- ------ "Option" shall mean the incentive stock option to purchase Common Stock of the Company granted under this Agreement. 1.12 - Parent Corporation - ---- ------------------ "Parent Corporation" shall mean any corporation in an unbroken chain of corporations ending with the Company if each of the corporations other than the Company then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one (1) of the other corporations in such chain. 1.13 - Plan - ---- ---- "Plan" shall mean the Amended and Restated Stock Option Plan of COMPS InfoSystems, Inc. 2 1.14 - Rule 16b-3 - ---- ---------- "Rule 16b-3" shall mean that certain Rule 16b-3 under the Exchange Act, as such Rule may be amended in the future. 1.15 - Secretary - ---- --------- "Secretary" shall mean the Secretary of the Company. 1.16 - Securities Act - ---- -------------- "Securities Act" shall mean the Securities Act of 1933, as amended. 1.17 - Subsidiary - ---- ---------- "Subsidiary" shall mean any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one (1) of the other corporations in such chain. 1.18 - Termination of Employment - ---- ------------------------- "Termination of Employment" shall mean the time when the employee- employer relationship between the Optionee and the Company, a Parent Corporation or a Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, a termination by resignation, discharge, death or retirement, but excluding any termination where there is a simultaneous reemployment by the Company, a Parent Corporation or a Subsidiary. The Administrator, in its absolute discretion, shall determine the effect of all other matters and questions relating to Termination of Employment, including, but not by way of limitation, the question of whether a Termination of Employment resulted from a discharge for good cause, and all questions of whether particular leaves of absence constitute Terminations of Employment; provided, however, that a leave of absence shall constitute a Termination of Employment if, and to the extent that, such leave of absence interrupts employment for purposes of Section 422(a)(2) of the Code and the then applicable regulations and revenue rulings under said Section. 2 GRANT OF OPTION --------------- 2.1 - Grant of Option - --- --------------- In consideration of the Employee's agreement to remain in the employ of the Company, its Parent Corporations or its Subsidiaries and for other good and valuable consideration, including the Company's desire to reward future services and contributions of the Employee, on the date hereof the Company irrevocably grants to the Employee the option to purchase any part or all of an aggregate of ________ shares of its $.0l par value non-voting Class B Common Stock upon the terms and conditions set forth in this Agreement. 3 2.2 - Purchase Price - --- -------------- The purchase price of the shares of stock covered by the Option shall be $.30 per share without commission or other charge. 2.3 - Consideration to Company - --- ------------------------ In consideration of the granting of this Option by the Company, the Employee agrees to render faithful and efficient services to the Company, a Parent Corporation or a Subsidiary, with such duties and responsibilities as the Company shall from time to time prescribe, for a period of at least one (1) year from the date this Option is granted. Nothing in this Agreement or in the Plan shall confer upon the Employee any right to continue in the employ of the Company, any Parent Corporation or any Subsidiary or shall interfere with or restrict in any way the rights of the Company, its Parent Corporations and its Subsidiaries, which are hereby expressly reserved, to discharge the Employee at any time for any reason whatsoever, with or without cause. 2.4 - Adjustments in Option - --- --------------------- In the event that the outstanding shares of the stock subject to the Option are changed into or exchanged for a different number or kind of shares of the Company or other securities of the Company by reason of merger, consolidation, recapitalization, reclassification, stock split up, stock dividend or combination of shares, the Administrator shall make an appropriate and equitable adjustment in the number and kind of shares as to which the Option, or portions thereof then unexercised, shall be exercisable, to the end that after such event the Employee's proportionate interest shall be maintained as before the occurrence of such event. Such adjustment in the Option shall be made without change in the total price applicable to the unexercised portion of the Option (except for any change in the aggregate price resulting from rounding-off of share quantities or prices) and with any necessary corresponding adjustment in the Option price per share; provided, however, that each such adjustment shall be made in such manner as not to constitute a "modification" within the meaning of Section 424(h)(3) of the Code. Any such adjustment made by the Administrator shall be final and binding upon the Employee, the Company and all other interested persons. 3 PERIOD OF EXERCISABILITY ------------------------ 3.1 - Commencement of Exercisability - --- ------------------------------ (a) Subject to Sections 3.5 and 5.6, the Option shall become exercisable in five (5) cumulative installments as follows: (i) The first installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the first anniversary of the date the Option is granted. 4 (ii) The second installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the second anniversary of the date the Option is granted. (iii) The third installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the third anniversary of the date the Option is granted. (iv) The fourth installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the fourth anniversary of the date the Option is granted. (v) The fifth installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the fifth anniversary of the date the Option is granted. (b) No portion of the Option which is unexercisable at Termination of Employment shall thereafter become exercisable. 3.2 - Duration of Exercisability - --- -------------------------- The installments provided for in Section 3.1 are cumulative. Each such installment which becomes exercisable pursuant to Section 3.1 shall remain exercisable until it becomes unexercisable under Section 3.3. 3.3 - Expiration of Option - --- -------------------- The Option may not be exercised to any extent by anyone after the first to occur of the following events: (a) The expiration of ten (10) years from the date the Option was granted; or (b) If the Employee owned (within the meaning of Section 424(d) of the Code), at the time the Option was granted, more than ten percent (10%) of the total combined voting power of all classes of stock of the Company, any Subsidiary or any Parent Corporation, the expiration of five (5) years from the date the Option was granted; or (c) The time of the Employee's Termination of Employment unless such Termination of Employment results from his death, his retirement, his disability (within the meaning of Section 22(e)(3) of the Code) or his being discharged not for good cause; or (d) The expiration of three (3) months from the date of the Employee's Termination of Employment by reason of his retirement or his being discharged not for good cause, unless the Employee dies within said three-month period; or (e) The expiration of one (1) year from the date of the Employee's Termination of Employment by reason of his disability (within the meaning of Section 22(e)(3) of the Code); or 5 (f) The expiration of one (1) year from the date of the Employee's death; or (g) The effective date of either the merger or consolidation of the Company with or into another corporation, or the acquisition by another corporation or person of all or substantially all of the Company's assets or eighty percent (80%) or more of the Company's then outstanding voting stock, or the liquidation or dissolution of the Company, unless the Administrator waives this provision in connection with such transaction. At least ten (10) days prior to the effective date of such merger, consolidation, acquisition, liquidation or dissolution, the Administrator shall give the Employee notice of such event if the Option has then neither been fully exercised nor become unexercisable under this Section 3.3. 3.4 - Acceleration of Exercisability - --- ------------------------------ In the event of the merger or consolidation of the Company with or into another corporation, or the acquisition by another corporation or person of all or substantially all of the Company's assets or eighty percent (80%) or more of the Company's then outstanding voting stock, or the liquidation or dissolution of the Company, the Administrator may, in its absolute discretion and upon such terms and conditions as it deems appropriate, provide by resolution, adopted prior to such event and incorporated in the notice referred to in Section 3.3(g), that at some time prior to the effective date of such event this Option shall be exercisable as to all the shares covered hereby, notwithstanding that this Option may not yet have become fully exercisable under Section 3.1(a); provided, however, that this acceleration of exercisability shall not take place if: (a) This Option becomes unexercisable under Section 3.3 prior to said effective date; or (b) In connection with such an event, provision is made for an assumption of this Option or a substitution therefor of a new option by an employer corporation, or a parent or subsidiary of such corporation, so that such assumption or substitution complies with the provisions of Section 424(a) of the Code; and provided, further, that nothing in this Section 3.4 shall make this Option exercisable if it is otherwise unexercisable by reason of Section 3.5 or Section 5.6. The Administrator may make such determinations and adopt such rules and conditions as it, in its absolute discretion, deems appropriate in connection with such acceleration of exercisability, including, but not by way of limitation, provisions to ensure that any such acceleration and resulting exercise shall be conditioned upon the consummation of the contemplated corporate transaction, and determinations regarding whether provisions for assumption or substitution have been made as defined in subsection (b) above. 3.5 - Limitation on Exercisability - --- ---------------------------- Notwithstanding any other provision of this Agreement, the aggregate fair market value (determined at the time the Option is granted) of the shares of the Company's stock with respect to which "incentive stock options" (within the meaning of Section 422 of the Code) are exercisable for the first time by the Employee during any calendar year (under the Plan and all 6 other incentive stock option plans of the Company, any Subsidiary and any Parent Corporation) shall not exceed $100,000. 4 EXERCISE OF OPTION ------------------ 4.1 - Person Eligible to Exercise - --- --------------------------- During the lifetime of the Employee, only he may exercise the Option or any portion thereof. After the death of the Employee, any exercisable portion of the Option may, prior to the time when the Option becomes unexercisable under Section 3.3, be exercised by his personal representative or by any person empowered to do so under the Employee's will or under the then applicable laws of descent and distribution. 4.2 - Partial Exercise - --- ---------------- Any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time prior to the time when the Option or portion thereof becomes unexercisable under Section 3.3; provided, however, that each partial exercise shall be for not less than One Thousand (1000) shares (or the minimum installment set forth in Section 3.1, if a smaller number of shares) and shall be for whole shares only. 4.3 - Manner of Exercise - --- ------------------ The Option, or any exercisable portion thereof, may be exercised solely by delivery to the Secretary or his office of all of the following prior to the time when the Option or such portion becomes unexercisable under Section 3.3: (a) Notice in writing signed by the Employee or the other person then entitled to exercise the Option or portion, stating that the Option or portion is thereby exercised, such notice complying with all applicable rules established by the Administrator; and (i) Full payment (by cashiers check or wire transfer) for the shares with respect to which such Option or portion is exercised; or (ii) With the consent of the Administrator, (A) shares of the Company's Common Stock owned by the Employee duly endorsed for transfer to the Company or (B) subject to the timing requirements of Section 4.4, shares of the Company's Common Stock issuable to the Employee upon exercise of the Option, with a fair market value (as determined under Section 4.2(b) of the Plan) on the date of Option exercise equal to the aggregate purchase price of the shares with respect to which such Option or portion is exercised; or (iii) With the consent of the Administrator; a promissory note bearing interest (at no less than such rate as shall then preclude the imputation of interest under the Code or successor provision) and payable upon such terms as may be prescribed by the Administrator. The Administrator may also prescribe the form of such note and the 7 security to be given for such note. That Option may not be exercised, however, by delivery of a promissory note or by a loan from the Company when or where such loan or other extension of credit is prohibited by law; or (iv) With the consent of the Administrator, any combination of the consideration provided in the foregoing subparagraphs (i) - (iii); and (b) A bona fide written representation and agreement, in a form satisfactory to the Administrator, signed by the Employee or other person then entitled to exercise such Option or portion, stating that the shares of stock are being acquired for his own account, for investment and without any present intention of distributing or reselling said shares or any of them except as may be permitted under the Securities Act and then applicable rules and regulations thereunder, and that the Employee or other person then entitled to exercise such Option or portion will indemnify the Company against and hold it free and harmless from any loss, damage, expense or liability resulting to the Company if any sale or distribution of the shares by such person is contrary to the representation and agreement referred to above. The Administrator may, in its absolute discretion, take whatever additional actions it deems appropriate to insure the observance and performance of such representation and agreement and to effect compliance with the Securities Act and any other federal or state securities laws or regulations. Without limiting the generality of the foregoing, the Administrator may require an opinion of counsel acceptable to it to the effect that any subsequent transfer of shares acquired on an Option exercise does not violate the Securities Act, and may issue stop-transfer orders covering such shares. Share certificates evidencing stock issued on exercise of this Option shall bear an appropriate legend referring to the provisions of this subsection (c) and the agreements herein. The written representation and agreement referred to in the first sentence of this subsection (c) shall, however, not be required if the shares to be issued pursuant to such exercise have been registered under the Securities Act, and such registration is then effective in respect of such shares; (c) Full payment to the Company (or other employer corporation) of all amounts which, under federal, state or local tax law, it is required to withhold upon exercise of the Option; with the consent of the Administrator, (i) shares of the Company's Common Stock owned by the Employee duly endorsed for transfer or (ii) subject to the timing requirements of Section 4.4, shares of the Company's Common Stock issuable to the Employee upon exercise of the Option, valued in accordance with Section 4.2(b) of the Plan at the date of Option exercise, may be used to make all or part of such payment; and (d) In the event the Option or portion shall be exercised pursuant to Section 4.1 by any person or persons other than the Employee, appropriate proof of the right of such person or persons to exercise the Option. 4.4 - Certain Timing Requirements - --- --------------------------- Shares of the Company's Common Stock issuable to the Employee upon exercise of the Option may be used to satisfy the Option price or the tax withholding consequences of such exercise only (i) during the period beginning on the third (3rd) business day following the date of release of the quarterly or annual summary statement of sales and earnings of the Company and ending on the twelfth (12th) business day following such date or (ii) pursuant to an 8 irrevocable written election by the Employee to use shares of the Company's Common Stock issuable to the Employee upon exercise of the Option to pay all or part of the Option price or the withholding taxes (subject to the approval of the Administrator) made at least six (6) months prior to the payment of such Option price or withholding taxes. 4.5 - Conditions to Issuance of Stock Certificates - --- -------------------------------------------- The shares of stock deliverable upon the exercise of the Option, or any portion thereof, may be either previously authorized but unissued shares or issued shares which have then been reacquired by the Company. Such shares shall be fully paid and nonassessable. The Company shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of the Option or portion thereof prior to fulfillment of all of the following conditions: (a) The obtaining of any approval or other clearance from any state or federal governmental agency which the Administrator shall, in its absolute discretion, determine to be necessary or advisable; and (b) The payment to the Company (or other employer corporation) of all amounts which, under federal, state or local tax law, it is required to withhold upon exercise of the Option; and (e) The lapse of such reasonable period of time following the exercise of the Option as the Administrator may from time to time establish for reasons of administrative convenience. 4.6 - Rights as Shareholder - --- --------------------- The holder of the Option shall not be, nor have any of the rights or privileges of, a shareholder of the Company in respect of any shares purchasable upon the exercise of any part of the Option unless and until certificates representing such shares shall have been issued by the Company to such holder. 5 OTHER PROVISIONS ---------------- 5.1 - Administration - --- -------------- The Administrator shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such rules. All actions taken and all interpretations and determinations made by the Administrator in good faith shall be final and binding upon the Employee, the Company and all other interested persons. No member of the Administrator shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or the Option. In the event the Administrator is the Committee, the Board shall have no right to exercise any of the rights or duties of the Committee under the Plan and this Agreement. 9 5.2 - Option Not Transferable - --- ----------------------- Neither the Option nor any interest or right therein or part thereof shall be liable for the debts, contracts or engagements of the Employee or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect; provided, however, that this Section 5.2 shall not prevent transfers by will or by the applicable laws of descent and distribution. 5.3 - Shares to Be Reserved - --- --------------------- The Company shall at all times during the term of the Option reserve and keep available such number of shares of stock as will be sufficient to satisfy the requirements of this Agreement. 5.4 - Notices - --- ------- Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary, and any notice to be given to the Employee shall be addressed to him at the address given beneath his signature hereto. By a notice given pursuant to this Section 5.4, either party may hereafter designate a different address for notices to be given to him. Any notice which is required to be given to the Employee shall, if the Employee is then deceased, be given to the Employee's personal representative if such representative has previously informed the Company of his status and address by written notice under this Section 5.4. Any notice shall be deemed duly given when enclosed in a properly sealed envelope or wrapper addressed as aforesaid, deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service. 5.5 - Titles - --- ------ Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement. 5.6 - Shareholder Approval - --- -------------------- The Plan will be submitted for approval by the Company's shareholders within twelve (12) months after the date the Plan was initially adopted by the Board. This Option may not be exercised to any extent by anyone prior to the time when the Plan is approved by the shareholders, and if such approval has not been obtained by the end of said twelve-month period, this Option shall thereupon be cancelled and become null and void. The Company shall take such actions as may be necessary to satisfy the requirements of Rule 16b-3(b). 5.7 - Notification of Disposition - --- --------------------------- The Employee shall give prompt notice to the Company of any disposition or other transfer of any shares of stock acquired under this Agreement if such disposition or transfer 10 is made (a) within two (2) years from the date of granting the Option with respect to such shares or (b) within one (1) year after the transfer of such shares to him. Such notice shall specify the date of such disposition or other transfer and the amount realized, in cash, other property, assumption of indebtedness or other consideration, by the Employee in such disposition or other transfer. 5.8 - Construction - --- ------------ This Agreement shall be administered, interpreted and enforced under the laws of the State of Delaware. 5.9 - Conformity to Securities Laws - --- ----------------------------- The Employee acknowledges that the Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, including without limitation Rule 16b-3. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Option is granted and may be exercised, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations. 5.10 - Company's Right to Repurchase Shares - ---- ------------------------------------ Upon Termination of Employment, the Company shall have the option to repurchase all (but not less than all) of the shares of stock which have been purchased by the Employee pursuant to exercise of the Option and which the Employee then holds. The repurchase price payable by the Company if it exercises its repurchase option shall be the greater of the purchase price of the shares pursuant to Section 2.2 or the fair market value of the shares of stock on the date of repurchase, determined in accordance with Section 4.2 of the Plan, except that if at the date of such repurchase, the Company's common stock is not publicly traded, the fair market value of the shares of stock shall be determined for purposes of this Section 5.10 on the basis of the following formula: eight (8) times the Company's pre-tax earnings for the Company's most recently audited fiscal year divided by the number of outstanding shares of the Company's common stock (including shares issuable upon the conversion of outstanding shares of preferred stock) on the date of repurchase. The Company's repurchase option shall be exercisable by giving written notice to the Employee within thirty (30) calendar days after the Termination of Employment provided, however, that in the event that the Optionee exercises the -------- ------- Option after the Optionee's Termination of Employment but prior to the expiration of the Option pursuant to the provisions of Section 3.3, the Company's repurchase option shall be exercisable by giving written notice within thirty (30) calendar days after the exercise of the Option by the Optionee. In the event that the Company exercises its option to repurchase shares of stock from the Optionee pursuant to this Section 5.10, Optionee's shares of stock shall automatically be cancelled, and Optionee shall have no further right, claim or title to such shares, other than the right to receive the 11 repurchase price provided for in this Section 5.10. Upon receipt of a general release and the stock certificates representing the shares, the Company shall forward payment for such shares. 5.11 - Restrictions on Transfer of Shares - ---- ---------------------------------- (a) There can be no valid transfer (as hereinafter defined) of any shares of stock purchased on exercise of the Option, or any interest in such shares, by any holder of such shares or interests unless such transfer is solely for cash consideration and is made in compliance with the following provisions: (i) Before there can be a valid transfer of any shares or any interest therein, the record holder of the shares to be transferred (the "Offered Shares") shall give written notice (by registered or certified mail) to the Company. Such notice shall specify the identity of the proposed transferee, the cash price offered for the Offered Shares by the proposed transferee and the other terms and conditions of the proposed transfer. The date such notice is mailed shall be hereinafter referred to as the "notice date" and the record holder of the Offered Shares shall be hereinafter referred to as the "Offeror." (ii) For a period of thirty (30) calendar days after the notice date, the Company shall have the option to purchase all (but not less than all) of the Offered Shares at the purchase price and on the terms set forth in subsection (a)(iii) of this Section 5.11. This option shall be exercisable by the Company by mailing (by registered or certified mail) written notice of exercise to the Offeror prior to the end of said thirty (30) days. (iii) The price at which the Company may purchase the Offered Shares pursuant to the exercise of such option shall be the lower of (a) the cash price offered for the Offered Shares by the proposed transferee (as set forth in the notice required under subsection (a)(i) of this Section 5.11) or (b) the greater of the purchase price of the shares pursuant to Section 2.2 or fair market value of the shares of stock on the notice date, determined in accordance with Section 4.2 of the Plan, except that if at the notice date, the Company's common stock is not publicly traded, the fair market value of the shares of stock shall be determined for purposes of this Section 5.11 on the basis of the following formula: eight (8) times the Company's pre-tax earnings for the Company's most recently audited fiscal year divided by the number of outstanding shares of the Company's common stock (including shares issuable upon the conversion of outstanding shares of preferred stock) on the notice date. The Company's notice of exercise of such option shall be accompanied by full payment for the Offered Shares and, upon such payment by the Company, the Company shall acquire full right, title and interest to all of the Offered Shares. (iv) If, and only if, the option given pursuant to subsection (a)(ii) of this Section 5.11 is not exercised, the transfer proposed in the notice given pursuant to subsection (a)(i) of this Section 5.11 may take place; provided, however, that such transfer must, in all respects, be exactly as proposed in said notice except that such transfer may not take place either before the tenth (10th) calendar day after the expiration of said thirty-day option exercise period or after the ninetieth (90th) calendar day after the 12 expiration of said thirty-day option exercise period, and if such transfer has not taken place prior to said ninetieth (90th) day, such transfer may not take place without once again complying with subsection (a) of this Section 5.11. (b) As used in this Section 5.11, the term "transfer" means any sale, encumbrance, pledge, gift or other form of disposition or transfer of shares of the Company's stock or any legal or equitable interest therein; provided, however, that the term "transfer" does not include a transfer of such shares or interests by will or by the applicable laws of descent and distribution or a gift of such shares if the transferee or donee agrees to be bound by the provisions of this Section 5.11. (c) None of the shares of the Company's stock purchased on exercise of the Option shall be transferred on the Company's books nor shall the Company recognize any such transfer of any such shares or any interest therein unless and until all applicable provisions of this Section 5.11 have been complied with in all respects. The certificates of stock evidencing shares of stock purchased on exercise of the Option shall bear an appropriate legend referring to the transfer restrictions imposed by this Section 5.11 and to the repurchase option provided for in Section 5.10. 5.12 - Company's Right to Non-Disclosure of Financial Information - ---- ---------------------------------------------------------- The Company shall have the right not to disclose the Company's financial information as long as the Company's common stock is not publicly traded. Whether an optionee or shareholder, the Employee agrees that Employee's access to the Company's financial information and financial records will be strictly prohibited as long as the Company's common stock is not publicly traded. Access to such financial information may only be granted by the Company's President or Chairman, in his or her sole discretion. 5.13 - Lock-up in Event of Initial Public Offering - ---- ------------------------------------------- The Optionee agrees that, during a period of 180 days from the date of the Initial Public Offering, Optionee will not, without the prior written consent of the underwriter(s) of the Initial Public Offering, directly or indirectly, sell, offer to sell, grant any option for the sale of, or otherwise dispose of or transfer, any shares of Common Stock issuable upon exercise of the Option. 5.14 - Dispute Resolution - ---- ------------------ Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be resolved by binding arbitration before a single neutral arbitrator. The arbitrator shall be selected from the American Arbitration Association through its procedures. All rules governing the arbitration shall be the rules as set forth by the American Arbitration Association. The arbitrator is bound to rule only on whether or not there has been a violation of the terms of this Agreement and to render an award, if any, that is consistent with the terms of this Agreement. Neither party to this Agreement is entitled to any legal recourse or rights or remedies other than those provided within this Agreement. The arbitrator may apportion the costs of the arbitration, including arbitrator's 13 fees, among the parties, but shall have no power to award attorneys' fees. Each party shall be responsible for its own attorneys' fees. IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties hereto. By -------------------------------------- President By -------------------------------------- Secretary - ------------------------------- Employee - ------------------------------- Address Employee's Taxpayer Identification Number: - ------------------------------- 14 EX-10.29 34 FORM OF STOCK OPTION PLAN EXHIBIT 10.29 FORM OF NON-QUALIFIED STOCK OPTION AGREEMENT -------------------------------------------- THIS AGREEMENT, dated _________ ___, 1995 is made by and between COMPS InfoSystems, Inc., a Delaware corporation hereinafter referred to as "Company," and __________, hereinafter referred to as "Optionee": WHEREAS, the Company wishes to afford the Optionee the opportunity to purchase shares of its $.01 par value non-voting Class B Common Stock; and WHEREAS, the Company wishes to carry out the Plan (the terms of which are hereby incorporated by reference and made a part of this Agreement); and WHEREAS, the Administrator appointed to administer the Plan, has determined that it would be to the advantage and best interest of the Company and its shareholders to grant the Non-Qualified Option provided for herein to the Optionee as an inducement to enter into or remain in a business relationship with the Company, its Parent Corporations or its Subsidiaries and as an incentive for increased efforts during such service, and has advised the Company thereof and instructed the undersigned officers to issue said Option; NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows: 1 DEFINITIONS ----------- Whenever the following terms are used in this Agreement, they shall have the meaning specified below unless the context clearly indicates to the contrary. The masculine pronoun shall include the feminine and neuter, and the singular the plural, where the context so indicates. 1.1 - Administrator - --- ------------- "Administrator" shall mean: (a) prior to the Initial Public Offering, the Board, or, in the sole and absolute discretion of the Board, the Committee; and (b) after the Initial Public Offering, the Committee. 1.2 - Board - --- ----- "Board" shall mean the Board of Directors of the Company. 1.3 - Code - --- ---- "Code" shall mean the Internal Revenue Code of 1986, as amended. 1.4 - Committee - --- --------- "Committee" shall mean the Stock Option Committee of the Board, appointed as provided in the Plan. 1.5 - Common Stock - --- ------------ "Common Stock" shall mean the Company's non-voting Class B Common Stock, par value $.01 per share. 1.6 - Company - --- ------- "Company" shall mean COMPS InfoSystems, Inc. 1.7 - Director - --- -------- "Director" shall mean a member of the Board. 1.8 - Exchange Act - --- ------------ "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. 1.9 - Initial Public Offering - --- ------------------------ "Initial Public Offering" shall mean the closing of the sale of the Company's securities pursuant to an underwritten public offering. 1.10 - Officer - ---- ------- "Officer" shall mean an officer of the Company, as defined in Rule 16a-l(f) under the Exchange Act, as such Rule may be amended in the future. 1.11 - Option - ---- ------ "Option" shall mean the non-qualified option to purchase Common Stock of the Company granted under this Agreement. 1.12 - Parent Corporation - ---- ------------------ "Parent Corporation" shall mean any corporation in an unbroken chain of corporations ending with the Company if each of the corporations other than the Company then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one (1) of the other corporations in such chain. 1. 13 - Plan - ----- ---- "Plan" shall mean the Stock Option Plan of COMPS InfoSystems, Inc. 2 1.14 - Rule 16b-3 - ---- ---------- "Rule 16b-3" shall mean that certain Rule 16b-3 under the Exchange Act, as such Rule may be amended in the future. 1.15 - Secretary - ---- --------- "Secretary" shall mean the Secretary of the Company. 1.16 - Securities Act - ---- -------------- "Securities Act" shall mean the Securities Act of 1933, as amended. 1.17 - Subsidiary - ---- ---------- "Subsidiary" shall mean any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one (1) of the other corporations in such chain. 1.18 - Termination of Business Relationship - ---- ------------------------------------ "Termination of Business Relationship" shall mean the time when the business relationship between the Optionee and the Company, a Parent Corporation or a Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, a termination by cessation of business, bankruptcy, contract termination, resignation, discharge or death. The Administrator, in its absolute discretion, shall determine the effect of all other matters and questions relating to Termination of Business Relationship, including, but not by way of limitation, the question of whether a Termination of Business Relationship resulted from a discharge for good cause. 2 GRANT OF OPTION --------------- 2.1 - Grant of Option - --- --------------- In consideration of the Optionee's agreement to remain in the business relationship with the Company, its Parent Corporations or its Subsidiaries and for other good and valuable consideration, on the date hereof the Company irrevocably grants to the Optionee the option to purchase any part or all of an aggregate of 7,500 shares of its $.01 par value non-voting Class B Common Stock upon the terms and conditions set forth in this Agreement. 2.2 - Purchase Price - --- -------------- The purchase price of the shares covered by the Option and shall be $.30 per share without commission or other charge. 3 2.3 - Consideration to Company - --- ------------------------ In consideration of the granting of this Option by the Company, the Optionee agrees to remain in the business relationship with the Company, a Parent Corporation or a Subsidiary, with such duties and responsibilities as the Company shall from time to time prescribe, for a period of at least one (1) year from the date this Option is granted. Nothing in this Agreement or in the Plan shall confer upon the Optionee any right to continue in a business relationship with the Company, any Parent Corporation or any Subsidiary or shall interfere with or restrict in any way the rights of the Company, its Parent Corporations and its Subsidiaries, which are hereby expressly reserved, to terminate such business relationship at any time for any reason whatsoever, with or without cause. 2.4 - Adjustments in Option - --- --------------------- In the event that the outstanding shares of the stock subject to the Option are changed into or exchanged for a different number or kind of shares of the Company or other securities of the Company by reason or merger, consolidation, recapitalization, reclassification, stock split up, stock dividend or combination of shares, the Administrator shall make an appropriate and equitable adjustment in the number and kind of shares as to which the Option, or portions thereof then unexercised, shall be exercisable, to the end that after such event the Optionee's proportionate interest shall be maintained as before the occurrence of such event. Such adjustment in the Option shall be made without change in the total price applicable to the unexercised portion of the Option (except for any change in the aggregate price resulting from rounding-off of share quantities or prices) and with any necessary corresponding adjustment in the Option price per share. Any such adjustment made by the Administrator shall be final and binding upon the Optionee, the Company and all other interested persons. 3 PERIOD OF EXERCISABILITY ------------------------ 3.1 - Commencement of Exercisability - --- ------------------------------ (a) Subject to Section 5.6, the Option shall become exercisable in five (5) cumulative installments as follows: (i) The first installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the first anniversary of the date the Option is granted. (ii) The second installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the second anniversary of the date the Option is granted. (iii) The third installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the third anniversary of the date the Option is granted. 4 (iv) The fourth installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the fourth anniversary of the date the Option is granted. (v) The fifth installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the fifth anniversary of the date the Option is granted. (b) No portion of the Option which is unexercisable at Termination of Business Relationship shall thereafter become exercisable. 3.2 - Duration of Exercisability - --- -------------------------- The installments provided for in Section 3.1 are cumulative. Each such installment which becomes exercisable pursuant to Section 3.1 shall remain exercisable until it becomes unexercisable under Section 3.3. 3.3 - Expiration of Option - --- -------------------- The Option may not be exercised to any extent by anyone after the first to occur of the following events: (a) The expiration of ten (10) years from the date the Option was granted; or (b) The time of the Optionee's Termination of Business Relationship unless such Termination of Business Relationship results from his death, his retirement, his disability or his being discharged not for good cause; or (c) The expiration of three (3) months from the date of the Optionee's Termination of Business Relationship by reason of his retirement or his being discharged not for good cause, unless the Optionee dies within said three-month period; or (d) The expiration of one (1) year from the date of the Optionee's Termination of Business Relationship by reason of his disability; or (e) The expiration of one (1) year from the date of the Optionee's death; or (f) The effective date of either the merger or consolidation of the Company with or into another corporation, or the acquisition by another corporation or person of all or substantially all of the Company's assets or eighty percent (80%) or more of the Company's then outstanding voting stock, or the liquidation or dissolution of the Company, unless the Administrator waives this provision in connection with such transaction. At least ten (10) days prior to the effective date of such merger, consolidation, acquisition, liquidation or dissolution, the Administrator shall give the Optionee notice of such event if the Option has then neither been fully exercised nor become unexercisable under this Section 3.3. 5 3.4 - Acceleration of Exercisability - --- ------------------------------ In the event of the merger or consolidation of the Company with or into another corporation, or the acquisition by another corporation or person of all or substantially all of the Company's assets or eighty percent (80%) or more of the Company's then outstanding voting stock, or the liquidation or dissolution of the Company, the Administrator may, in its absolute discretion and upon such terms and conditions as it deems appropriate, provide by resolution, adopted prior to such event and incorporated in the notice referred to in Section 3.3(f), that at some time prior to the effective date of such event this Option shall be exercisable as to all the shares covered hereby, notwithstanding that this Option may not yet have become fully exercisable under Section 3.1(a); provided, however, that this acceleration of exercisability shall not take place if: (a) This Option becomes unexercisable under Section 3.3 prior to said effective date; or (b) In connection with such an event, provision is made for an assumption of this Option or a substitution therefor of a new option by an employer corporation or a parent or subsidiary of such corporation; and provided, further, that nothing in this Section 3.4 shall make this Option exercisable if it is otherwise unexercisable by reason of Section 5.6. The Administrator may make such determinations and adopt such rules and conditions as it, in its absolute discretion, deems appropriate in connection with such acceleration of exercisability, including, but not by way of limitation, provisions to ensure that any such acceleration and resulting exercise shall be conditioned upon the consummation of the contemplated corporate transaction. 4 EXERCISE OF OPTION ------------------ 4.1 - Person Eligible to Exercise - --- --------------------------- During the lifetime of the Optionee, only he may exercise the Option or any portion thereof. After the death of the Optionee, any exercisable portion of the Option may, prior to the time when the Option becomes unexercisable under Section 3.3, be exercised by his personal representative or by any person empowered to do so under the Optionee's will or under the then applicable laws of descent and distribution. 4.2 - Partial Exercise - --- ---------------- Any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time prior to the time when the Option or portion thereof becomes unexercisable under Section 3.3; provided, however, that each partial exercise shall be for not less than One Thousand (1000) shares (or the minimum installment set forth in Section 3. 1, if a smaller number of shares) and shall be for whole shares only. 6 4.3 - Manner of Exercise - --- ------------------ The Option, or any exercisable portion thereof, may be exercised solely by delivery to the Secretary or his office of all of the following prior to the time when the Option or such portion becomes unexercisable under Section 3.3: (a) Notice in writing signed by the Optionee or the other person then entitled to exercise the Option or portion, stating that the Option or portion is thereby exercised, such notice complying with all applicable rules established by the Committee; and (b) (i) Full payment (by cashiers check or wire transfer) for the shares with respect to which such Option or portion is exercised; or (i) With the consent of the Administrator, (A) shares of the Company's Common Stock owned by the Optionee duly endorsed for transfer to the Company or (B) subject to the timing requirements of Section 4.4, shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option, with a fair market value (as determined under Section 4.2(b) of the Plan) on the date of Option exercise equal to the aggregate purchase price of the shares with respect to which such Option or portion is exercised; or (ii) With the consent of the Administrator, a promissory note bearing interest (at no less than such rate as shall then preclude the imputation of interest under the Code or successor provision) and payable upon such terms as may be prescribed by the Administrator. The Administrator may also prescribe the form of such note and the security to be given for such note. That Option may not be exercised, however, by delivery of a promissory note or by a loan from the Company when or where such loan or other extension of credit is prohibited by law; or (iii) With the consent of the Administrator, any combination of the consideration provided in the foregoing subparagraphs (i) - (iii); and (c) A bona fide written representation and agreement, in a form satisfactory to the Administrator, signed by the Optionee or other person then entitled to exercise such Option or portion, stating that the shares of stock are being acquired for his own account, for investment and without any present intention of distributing or reselling said shares or any of them except as may be permitted under the Securities Act and then applicable rules and regulations thereunder, and that the Optionee or other person then entitled to exercise such Option or portion will indemnify the Company against and hold it free and harmless from any loss, damage, expense or liability resulting to the Company if any sale or distribution of the shares by such person is contrary to the representation and agreement referred to above. The Administrator may, in its absolute discretion, take whatever additional actions it deems appropriate to insure the observance and performance of such representation and agreement and to effect compliance with the Securities Act and any other federal or state securities laws or regulations. Without limiting the generality of the foregoing, the Administrator may require an opinion of counsel acceptable to it to the effect that any subsequent transfer of shares acquired on an Option exercise does not violate the Securities Act, and may issue stop-transfer orders covering such shares. Share 7 certificates evidencing stock issued on exercise of this Option shall bear an appropriate legend referring to the provisions of this subsection (c) and the agreements herein. The written representation and agreement referred to in the first sentence of this subsection (c) shall, however, not be required if the shares to be issued pursuant to such exercise have been registered under the Securities Act, and such registration is then effective in respect of such shares; and (d) Full payment to the Company (or other employer corporation) of all amounts which, under federal, state or local tax law, it is required to withhold upon exercise of the Option; with the consent of the Administrator, (i) shares of the Company's Common Stock owned by the Optionee duly endorsed for transfer, or (ii) subject to the timing requirements of Section 4.4, shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option, valued in accordance with Section 4.2(b) of the Plan at the date of Option exercise, may be used to make all or part of such payment; and (e) In the event the Option or portion shall be exercised pursuant to Section 4.1 by any person or persons other than the Optionee, appropriate proof of the right of such person or persons to exercise the Option. 4.4 - Certain Timing Requirements - --- --------------------------- Shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option may be used to satisfy the Option price or the tax withholding consequences of such exercise only (i) during the period beginning on the third (3rd) business day following the date of release of the quarterly or annual summary statement of sales and earnings of the Company and ending on the twelfth (12th) business day following such date or (ii) pursuant to an irrevocable written election by the Optionee to use shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option to pay all or part of the Option price or the withholding taxes (subject to the approval of the Administrator) made at least six (6) months prior to the payment of such Option price or withholding taxes. 4.5 - Conditions to Issuance of Stock Certificates - --- -------------------------------------------- The shares of stock deliverable upon the exercise of the Option, or any portion thereof, may be either previously authorized but unissued shares or issued shares which have then been reacquired by the Company. Such shares shall be fully paid and nonassessable. The Company shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of the Option or portion thereof prior to fulfillment of all of the following conditions: (a) The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; and (b) The completion of any registration or other qualification of such shares under any state or federal law or under rulings or regulations of the Securities and Exchange Commission or of any other governmental regulatory body, which the Administrator shall, in its absolute discretion, deem necessary or advisable; and 8 (c) The obtaining of any approval or other clearance from any state or federal governmental agency which the Administrator shall, in its absolute discretion, determine to be necessary or advisable; and (d) The payment to the Company (or other employer corporation) of all amounts which, under federal, state or local tax law, it is required to withhold upon exercise of the Option; and (e) The lapse of such reasonable period of time following the exercise of the Option as the Administrator may from time to time establish for reasons of administrative convenience. 4.6 - Rights as Shareholder - --- --------------------- The holder of the Option shall not be, nor have any of the rights or privileges of, a shareholder of the Company in respect of any shares purchasable upon the exercise of any part of the Option unless and until certificates representing such shares shall have been issued by the Company to such holder. 5 OTHER PROVISIONS 5.1 - Administration - --- -------------- The Administrator shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such rules. All actions taken and all interpretations and determinations made by the Administrator in good faith shall be final and binding upon the Optionee, the Company and all other interested persons. No member of the Administrator shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or the Option. In the event that the Administrator is the Committee, the Board shall have no right to exercise any of the rights or duties of the Committee under the Plan and this Agreement. 5.2 - Option Not Transferable - --- ----------------------- Neither the Option nor any interest or right therein or part thereof shall be liable for the debts, contracts or engagements of the Optionee or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect; provided, however, that this Section 5.2 shall not prevent transfers by will or by the applicable laws of descent and distribution. 9 5.3 - Shares to Be Reserved - --- --------------------- The Company shall at all times during the term of the Option reserve and keep available such number of shares of stock as will be sufficient to satisfy the requirements of this Agreement. 5.4 - Notices - --- ------- Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary, and any notice to be given to the Optionee shall be addressed to him at the address given beneath his signature hereto. By a notice given pursuant to this Section 5.4, either party may hereafter designate a different address for notices to be given to him. Any notice which is required to be given to the Optionee shall, if the Optionee is then deceased, be given to the Optionee's personal representative if such representative has previously informed the Company of his status and address by written notice tinder this Section 5.4. Any notice shall be deemed duly given when enclosed in a properly sealed envelope or wrapper addressed as aforesaid, deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service. 5.5 - Titles - --- ------ Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement. 5.6 - Shareholder Approval - ---- -------------------- The Plan will be submitted for approval by the Company's shareholders within twelve (12) months after the date the Plan was initially adopted by the Board. This Option may not be exercised to any extent by anyone prior to the time when the Plan is approved by the shareholders, and if such approval has not been obtained by the end of said twelve-month period, this Option shall thereupon be cancelled and become null and void. The Company shall take such actions as may be necessary to satisfy the requirements of Rule 16b-3(b). 5.7 - Construction - --- ------------ This Agreement shall be administered, interpreted and enforced under the laws of the State of Delaware. 5.8 - Conformity to Securities Laws - --- ----------------------------- The Optionee acknowledges that the Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, including without limitation Rule 16b-3. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Option is granted and may be exercised, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations. 10 5.9 - Company's Right to Repurchase Shares - --- ------------------------------------ Upon Termination of Business Relationship, the Company shall have the option to repurchase all (but not less than all) of the shares of stock which have been purchased by the Optionee pursuant to exercise of the Option and which the Optionee then holds. The repurchase price payable by the Company if it exercises its repurchase option shall be the fair market value of the shares of stock on the date of repurchase, determined in accordance with Section 4.2 of the Plan, except that if at the date of such repurchase, the Company's common stock is not publicly traded, the fair market value of the shares of stock shall be determined for purposes of this Section 5.9 on the basis of the following formula: eight (8) times the Company's pre-tax earnings for the Company's most recently audited fiscal year divided by the number of outstanding shares of the Company's common stock (including shares issuable upon the conversion of outstanding shares of preferred stock) on the date of repurchase. The Company's repurchase option shall be exercisable by giving written notice to the Optionee within thirty (30) calendar days after the Termination of Business Relationship provided, however, that in the event that the Optionee -------- ------- exercises the Option after the Optionee's Termination of Business Relationship but prior to the expiration of the Option pursuant to the provisions of Section 3.3, the Company's repurchase option shall be exercisable by giving written notice within thirty (30) calendar days after the exercise of the Option by the Optionee. In the event that the Company exercises its option to repurchase shares of stock from the Optionee pursuant to this Section 5.9, the Optionee shall sign a general release acknowledging that the Optionee has no further right, claim or title to such shares. Upon receipt of such general release and the stock certificates representing the shares, the Company shall forward payment for such shares. 5.10 - Restrictions on Transfer of Shares - ---- ---------------------------------- (a) There can be no valid transfer (as hereinafter defined) of any shares of stock purchased on exercise of the Option, or any interest in such shares, by any holder of such shares or interests unless such transfer is solely for cash consideration and is made in compliance with the following provisions: (i) Before there can be a valid transfer of any shares or any interest therein, the record holder of the shares to be transferred (the "Offered Shares") shall give written notice (by registered or certified mail) to the Company. Such notice shall specify the identity of the proposed transferee, the cash price offered for the Offered Shares by the proposed transferee and the other terms and conditions of the proposed transfer. The date such notice is mailed shall be hereinafter referred to as the "notice date" and the record holder of the Offered Shares shall be hereinafter referred to as the "Offeror. (ii) For a period of thirty (30) calendar days after the notice date, the Company shall have the option to purchase all (but not less than all) of the Offered Shares at the purchase price and on the terms set forth in subsection (a)(3) of this Section 5.10. This option shall be exercisable by the Company by mailing (by registered or 11 certified mail) written notice of exercise to the Offeror prior to the end of said thirty (30) days. (iii) The price at which the Company may purchase the Offered Shares pursuant to the exercise of such option shall be the lower of the cash price offered for the Offered Shares by the proposed transferee (as set forth in the notice required under subsection (a)(i) of this Section 5. 10) or the fair market value. The Company's notice of exercise of such option shall be accompanied by full payment for the Offered Shares and, upon such payment by the Company, the Company shall acquire full right, title and interest to all of the Offered Shares. (iv) If, and only if, the option given pursuant to subsection (a)(ii) of this Section 5.10 is not exercised, the transfer proposed in the notice given pursuant to subsection (a)(i) of this Section 5.10 may take place; provided, however, that such transfer must, in all respects, be exactly as proposed in said notice except that such transfer may not take place either before the tenth (10th) calendar day after the expiration of said thirty-day option exercise period or after the ninetieth (90th) calendar day after the expiration of said thirty-day option exercise period, and if such transfer has not taken place prior to said ninetieth (90th) day, such transfer may not take place without once again complying with subsection (a) of this Section 5.10. (b) As used in this Section 5. 10, the term "transfer" means any sale, encumbrance, pledge, gift or other form of disposition or transfer of shares of the Company's stock or any legal or equitable interest therein; provided, however, that the term "transfer" does not include a transfer of such shares or interests by will or by the applicable laws of descent and distribution or a gift of such shares if the transferee or donee agrees to be bound by the provisions of this Section 5. 10. (c) None of the shares of the Company's stock purchased on exercise of the Option shall be transferred on the Company's books nor shall the Company recognize any such transfer of any such shares or any interest therein unless and until all applicable provisions of this Section 5.10 have been complied with in all respects. The certificates of stock evidencing shares of stock purchased on exercise of the Option shall bear an appropriate legend referring to the transfer restrictions imposed by this Section 5.10 and to the repurchase option provided for in Section 5.9. 5.11 - Lock-up in Event of Initial Public Offering - ---- ------------------------------------------- The Optionee agrees that, during a period of 180 days from the date of the Initial Public Offering, Optionee will not, without the prior written consent of the underwriter(s) of the Initial Public Offering, directly or indirectly, sell, offer to sell, grant any option for the sale of, or otherwise dispose of or transfer, any shares of Common Stock issuable upon exercise of the Option. 12 5.12 - Dispute Resolution - ---- ------------------ Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be resolved by binding arbitration before a single neutral arbitrator. The arbitrator shall be selected from the American Arbitration Association through its procedures. All rules governing the arbitration shall be the rules as set forth by the American Arbitration Association. The arbitrator is bound to rule only on whether or not there has been a violation of the terms of this Agreement and to render an award, if any, that is consistent with the terms of this Agreement. Neither party to this Agreement is entitled to any legal recourse or rights or remedies other than those provided within this Agreement. The arbitrator may apportion the costs of the arbitration, including arbitrator's fees, among the parties, but shall have no power to award attorneys' fees. Each party shall be responsible for its own attorneys' fees. IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties hereto. By ------------------------------ President By ------------------------------ Secretary - ------------------------------ Optionee - ------------------------------ - ------------------------------ Address Optionee's Taxpayer Identification Number: - ------------------------------ 13 EX-10.30 35 1998 EQUITY PARTICIPATION PLAN EXHIBIT 10.30 THE 1998 EQUITY PARTICIPATION PLAN OF COMPS INFOSYSTEMS, INC. COMPS InfoSystems, Inc., a Delaware corporation, has adopted The 1998 Equity Participation Plan of COMPS InfoSystems, Inc. (the "Plan"), effective October 28, 1998, for the benefit of its eligible employees, consultants and directors. The purposes of the Plan are as follows: (1) To provide an additional incentive for directors, key Employees and Consultants (as such terms are defined below) to further the growth, development and financial success of the Company by personally benefiting through the ownership of Company stock and/or rights which recognize such growth, development and financial success. (2) To enable the Company to obtain and retain the services of directors, key Employees and Consultants considered essential to the long range success of the Company by offering them an opportunity to own stock in the Company and/or rights which will reflect the growth, development and financial success of the Company. ARTICLE I. DEFINITIONS 1.1. General. Wherever the following terms are used in the Plan they ------- shall have the meanings specified below, unless the context clearly indicates otherwise. 1.2. Administrator. "Administrator" shall mean the entity that ------------- conducts the general administration of the Plan as provided herein. With reference to the administration of the Plan with respect to Options granted to Independent Directors, the term "Administrator" shall refer to the Board. With reference to the administration of the Plan with respect to any other award, the term "Administrator" shall refer to the Committee unless the Board has assumed the authority for administration of the Plan generally as provided in Section 10.1. 1.3. Award. "Award" shall mean an Option, a Restricted Stock award, ----- a Performance Award, a Dividend Equivalents award, a Deferred Stock award, a Stock Payment award or a Stock Appreciation Right which may be awarded or granted under the Plan (collectively, "Awards"). 1.4. Award Agreement. "Award Agreement" shall mean a written --------------- agreement executed by an authorized officer of the Company and the Holder which shall contain such terms and conditions with respect to an Award as the Administrator shall determine, consistent with the Plan. 1.5. Award Limit. "Award Limit" shall mean 400,000 shares of Common ----------- Stock, as adjusted pursuant to Section 11.3 of the Plan. 1.6. Board. "Board" shall mean the Board of Directors of the ----- Company. 1.7. Code. "Code" shall mean the Internal Revenue Code of 1986, as ---- amended. 1.8. Committee. "Committee" shall mean the Compensation Committee of --------- the Board, or another committee or subcommittee of the Board, appointed as provided in Section 10.1. 1.9. Common Stock. "Common Stock" shall mean the non-voting Class B ------------ common stock of the Company, par value $.01 per share, and any equity security of the Company issued or authorized to be issued in the future, but excluding any preferred stock and any warrants, options or other rights to purchase Common Stock. 1.10. Company. "Company" shall mean COMPS InfoSystems, Inc., a ------- Delaware corporation. 1.11. Consultant. "Consultant" shall mean any consultant or adviser ---------- if: (a) the consultant or adviser renders bona fide services to the Company; (b) the services rendered by the consultant or adviser are not in connection with the offer or sale of securities in a capital-raising transaction and do not directly or indirectly promote or maintain a market for the Company's securities; and (c) the consultant or adviser is a natural person who has contracted directly with the Company to render such services. 1.12. Deferred Stock. "Deferred Stock" shall mean Common Stock -------------- awarded under Article VIII of the Plan. 1.13. Director. "Director" shall mean a member of the Board. -------- 1.14. Dividend Equivalent. "Dividend Equivalent" shall mean a right ------------------- to receive the equivalent value (in cash or Common Stock) of dividends paid on Common Stock, awarded under Article VIII of the Plan. 1.15. DRO. "DRO" shall mean a domestic relations order as defined by --- the Code or Title I of the Employee Retirement Income Security Act of 1974, as amended, or the rules thereunder. 1.16. Employee. "Employee" shall mean any officer or other employee -------- (as defined in accordance with Section 3401(c) of the Code) of the Company, or of any corporation which is a Subsidiary. 1.17. Exchange Act. "Exchange Act" shall mean the Securities ------------ Exchange Act of 1934, as amended. 2 1.18. Fair Market Value. "Fair Market Value" of a share of Common ----------------- Stock as of a given date shall be (a) the closing price of a share of Common Stock on the principal exchange on which shares of Common Stock are then trading, if any (or as reported on any composite index which includes such principal exchange), on the trading day previous to such date, or if shares were not traded on the trading day previous to such date, then on the next preceding date on which a trade occurred, or (b) if Common Stock is not traded on an exchange but is quoted on NASDAQ or a successor quotation system, the mean between the closing representative bid and asked prices for the Common Stock on the trading day previous to such date as reported by NASDAQ or such successor quotation system; or (c) if Common Stock is not publicly traded on an exchange and not quoted on NASDAQ or a successor quotation system, the Fair Market Value of a share of Common Stock as established by the Administrator acting in good faith. 1.19. Holder. "Holder" shall mean a person who has been granted or ------ awarded an Award. 1.20. Incentive Stock Option. "Incentive Stock Option" shall mean an ---------------------- option which conforms to the applicable provisions of Section 422 of the Code and which is designated as an Incentive Stock Option by the Administrator. 1.21. Independent Director. "Independent Director" shall mean a -------------------- member of the Board who is not an Employee of the Company. 1.22. Non-Qualified Stock Option. "Non-Qualified Stock Option" shall -------------------------- mean an Option which is not designated as an Incentive Stock Option by the Administrator. 1.23. Option. "Option" shall mean a stock option granted under ------ Article IV of the Plan. An Option granted under the Plan shall, as determined by the Administrator, be either a Non-Qualified Stock Option or an incentive Stock Option; provided, however, that Options granted to Independent Directors and Consultants shall be Non-Qualified Stock Options. 1.24. Performance Award. "Performance Award" shall mean a cash ----------------- bonus, stock bonus or other performance or incentive award that is paid in cash, Common Stock or a combination of both, awarded under Article VIII of the Plan. 1.25. Performance Criteria. "Performance Criteria" shall mean the -------------------- following business criteria with respect to the Company, any Subsidiary or any division or operating unit: (a) net income, (b) pre-tax income, (c) operating income, (d) cash flow, (e) earnings per share, (f) return on equity, (g) return on invested capital or assets, (h) cost reductions or savings, (i) funds from operations, (j) appreciation in the fair market value of Common Stock and (k) earnings before any one or more of the following items: interest, taxes, depreciation or amortization. 1.26. Plan. "Plan" shall mean The 1998 Equity Participation Plan of ---- COMPS Infosystems, Inc. 1.27. Restricted Stock. "Restricted Stock" shall mean Common Stock ---------------- awarded under Article VII of the Plan. 3 1.28. Rule 16b-3. "Rule 16b-3" shall mean that certain Rule 16b-3 ---------- under the Exchange Act, as such Rule may be amended from time to time. 1.29. Section 162(m) Participant. "Section 162(m) Participant" shall -------------------------- mean any key Employee designated by the Administrator as a key Employee whose compensation for the fiscal year in which the key Employee is so designated or a future fiscal year may be subject to the limit on deductible compensation imposed by Section 162(m) of the Code. 1.30. Securities Act. "Securities Act" shall mean the Securities Act -------------- of 1933, as amended. 1.31. Stock Appreciation Right. "Stock Appreciation Right" shall ------------------------ mean a stock appreciation right granted under Article IX of the Plan. 1.32. Stock Payment. "Stock Payment" shall mean (a) a payment in the ------------- form of shares of Common Stock, or (b) an option or other right to purchase shares of Common Stock, as part of a deferred compensation arrangement, made in lieu of all or any portion of the compensation, including without limitation, salary, bonuses and commissions, that would otherwise become payable to a key Employee or Consultant in cash, awarded under Article VIII of the Plan. 1.33. Subsidiary. "Subsidiary" shall mean any corporation in an ---------- unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 1.34. Substitute Award. "Substitute Award" shall mean an Option ---------------- granted under this Plan upon the assumption of, or in substitution for, outstanding equity awards previously granted by a company or other entity in connection with a corporate transaction, such as a merger, combination, consolidation or acquisition of property or stock; provided, however, that in no ------- ------- event shall the term "Substitute Award" be construed to refer to an award made in connection with the cancellation and repricing of an Option. 1.35. Termination of Consultancy. "Termination of Consultancy" shall -------------------------- mean the time when the engagement of a Holder as a Consultant to the Company or a Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, by resignation, discharge, death or retirement; but excluding terminations where there is a simultaneous commencement of employment with the Company or any Subsidiary. The Administrator, in its absolute discretion, shall determine the effect of all matters and questions relating to Termination of Consultancy, including, but not by way of limitation, the question of whether a Termination of Consultancy resulted from a discharge for good cause, and all questions of whether a particular leave of absence constitutes a Termination of Consultancy, Notwithstanding any other provision of the Plan, the Company or any Subsidiary has an absolute and unrestricted right to terminate a Consultant's service at any time for any reason whatsoever, with or without cause, except to the extent expressly provided otherwise in writing. 1.36. Termination of Directorship. "Termination of Directorship" --------------------------- shall mean the time when a Holder who is an Independent Director ceases to be a Director for any reason, 4 including, but not by way of limitation, a termination by resignation, failure to be elected, death or retirement. The Board, in its sole and absolute discretion, shall determine the effect of all matters and questions relating to Termination of Directorship with respect to Independent Directors. 1.37. Termination of Employment "Termination of Employment" shall ------------------------- mean the time when the employee-employer relationship between a Holder and the Company or any Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, a termination by resignation, discharge, death, disability or retirement; but excluding (a) terminations where there is a simultaneous reemployment or continuing employment of a Holder by the Company or any Subsidiary, (b) at the discretion of the Administrator, terminations which result in a temporary severance of the employee-employer relationship, and (c) at the discretion of the Administrator, terminations which are followed by the simultaneous establishment of a consulting relationship by the Company or a Subsidiary with the former employee. The Administrator, in its absolute discretion, shall determine the effect of all matters and questions relating to Termination of Employment, including, but not by way of limitation, the question of whether a Termination of Employment resulted from a discharge for good cause, and all questions of whether a particular leave of absence constitutes a Termination of Employment; provided, however, that, with respect -------- ------- to Incentive Stock Options, unless otherwise determined by the Administrator in its discretion, a leave of absence, change in status from an employee to an independent contractor or other change in the employee-employer relationship shall constitute a Termination of Employment if, and to the extent that, such leave of absence, change in status or other change interrupts employment for the purposes of Section 422(a)(2) of the Code and the then applicable regulations and revenue rulings under said Section. ARTICLE II. SHARES SUBJECT TO PLAN 2.1. Shares Subject to Plan. ---------------------- (a) The shares of stock subject to Awards shall be Common Stock, initially shares of the Company's Common Stock, par value $.01 per share. The aggregate number of such shares which may be issued upon exercise of such Options or rights or upon any such awards under the Plan, together with the aggregate number of shares of the Company's Common Stock which may be issued upon exercise of options to acquire shares of the Company's Common Stock granted under the Amended and Restated Stock Option Plan of COMPS InfoSystems, Inc., shall not exceed 1,944,909. The shares of Common Stock issuable upon exercise of such Options or rights or upon any such awards may be either previously authorized but unissued shares or treasury shares. (b) The maximum number of shares which may be subject to Awards, granted under the Plan to any individual in any fiscal year shall not exceed the Award Limit. To the extent required by Section 162(m) of the Code, shares subject to Options which are canceled continue to be counted against the Award Limit. 5 2.2. Add-back of Options and Other Rights. If any Option, or other ------------------------------------ right to acquire shares of Common Stock under any other Award under the Plan, expires or is canceled without having been fully exercised, or is exercised in whole or in part for cash as permitted by the Plan, the number of shares subject to such Option or other right but as to which such Option or other right was not exercised prior to its expiration, cancellation or exercise may again be optioned, granted or awarded hereunder, subject to the limitations of Section 2.1. Furthermore, any shares subject to Awards which are adjusted pursuant to Section 11.3 and become exercisable with respect to shares of stock of another corporation shall be considered canceled and may again be optioned, granted or awarded hereunder, subject to the limitations of Section 2.1. Shares of Common Stock which are delivered by the Holder or withheld by the Company upon the exercise of any Award under the Plan, in payment of the exercise price thereof or tax withholding thereon, may again be optioned, granted or awarded hereunder, subject to the limitations of Section 2.1. If any shares of Restricted Stock are surrendered by the Holder or repurchased by the Company pursuant to Section 7.4 or 7.5 hereof, such shares may again be optioned, granted or awarded hereunder, subject to the limitations of Section 2.1. Notwithstanding the provisions of this Section 2.2, no shares of Common Stock may again be optioned, granted or awarded if such action would cause an Incentive Stock Option to fail to qualified as an incentive stock option under Section 422 of the Code. ARTICLE III. GRANTING OF AWARDS 3.1. Award Agreement. Each Award shall be evidenced by an Award --------------- Agreement. Award Agreements evidencing Awards intended to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code shall contain such terms and conditions as may be necessary to meet the applicable provisions of Section 162(m) of the Code. Award Agreements evidencing Incentive Stock Options shall contain such terms and conditions as may be necessary to meet the applicable provisions of Section 422 of the Code. 3.2. Provisions Applicable to Section 167(m) Participants. ---------------------------------------------------- (a) The Committee, in its discretion, may determine whether an Award is to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code. (b) Notwithstanding anything in the Plan to the contrary, the Committee may grant any Award to a Section 162(m) Participant, including Restricted Stock, the restrictions with respect to which lapse upon the attainment of performance goals which are related to one or more of the Performance Criteria and any performance or incentive award described in Article VIII that vests or becomes exercisable or payable upon the attainment of performance goals which are related to one or more of the Performance Criteria. (c) To the extent necessary to comply with the performance-based compensation requirements of Section 162(m)(4)(C) of the Code, with respect to any Award granted under Articles VII and VIII which may be granted to one or more Section 162(m) Participants, no later than ninety (90) days following the commencement of any fiscal year in question or any other designated fiscal period or period of service (or such other time as may be 6 required or permitted by Section 162(m) of the Code), the Committee shall, in writing, (i) designate one or more Section 162(m) Participants, (ii) select the Performance Criteria applicable to the fiscal year or other designated fiscal period or period of service, (iii) establish the various performance targets, in terms of an objective formula or standard, and amounts of such Awards, as applicable, which may be earned for such fiscal year or other designated fiscal period or period of service and (iv) specify the relationship between Performance Criteria and the performance targets and the amounts of such Awards, as applicable, to be earned by each Section 162(m) Participant for such fiscal year or other designated fiscal period or period of service. Following the completion of each fiscal year or other designated fiscal period or period of service, the Committee shall certify in writing whether the applicable performance targets have been achieved for such fiscal year or other designated fiscal period or period of service. In determining the amount earned by a Section 162(m) Participant, the Committee shall have the right to reduce (but not to increase) the amount payable at a given level of performance to take into account additional factors that the Committee may deem relevant to the assessment of individual or corporate performance for the fiscal year or other designated fiscal period or period of service. (d) Furthermore, notwithstanding any other provision of the Plan or any Award which is granted to a Section 162(m) Participant and is intended to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code shall be subject to any additional limitations set forth in Section 162(m) of the Code (including any amendment to Section 162(m) of the Code) or any regulations or rulings issued thereunder that are requirements for qualification as performance-based compensation as described in Section 162(m)(4)(C) of the Code, and the Plan shall be deemed amended to the extent necessary to conform to such requirements. 3.3. Limitations Applicable to Section 16 Persons. Notwithstanding -------------------------------------------- any other provision of the Plan, the Plan, and any Award granted or awarded to any individual who is then subject to Section 16 of the Exchange Act, shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by applicable law, the Plan and Awards granted or awarded hereunder shall be deemed amended to the extent necessary to conform to such applicable exemptive rule. 3.4. Consideration. In consideration of the granting of an Award ------------- under the Plan, the Holder shall agree, in the Award Agreement, to remain in the employ of (or to consult for or to serve as an Independent Director of, as applicable) the Company or any Subsidiary for a period of at least one year (or such shorter period as may be fixed in the Award Agreement or by action of the Administrator following grant of the Award) after the Award is granted (or, in the case of an Independent Director, until the next annual meeting of stockholders of the Company). 3.5. At-Will Employment. Nothing in the Plan or in any Award ------------------ Agreement hereunder shall confer upon any Holder any right to continue in the employ of, or as a Consultant for, the Company or any Subsidiary, or as a director of the Company, or shall interfere with or restrict in any way the rights of the Company and any Subsidiary, which are hereby expressly reserved, to discharge any Holder at any time for any reason whatsoever, with or without cause, 7 except to the extent expressly provided otherwise in a written employment agreement between the Holder and the Company and any Subsidiary. ARTICLE IV. GRANTING OF OPTIONS TO EMPLOYEES, CONSULTANTS AND INDEPENDENT DIRECTORS 4.1. Eligibility. Any Employee or Consultant selected by the ----------- Committee pursuant to Section 4.4(a)(i) shall be eligible to be granted an Option. Each Independent Director of the Company shall be eligible to be granted Options at the times and in the manner set forth in Section 4.5. 4.2. Disqualification for Stock Ownership. No person may be granted ------------------------------------ an Incentive Stock Option under the Plan if such person, at the time the Incentive Stock Option is granted, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any then existing Subsidiary or parent corporation (within the meaning of Section 422 of the Code) unless such Incentive Stock Option conforms to the applicable provisions of Section 422 of the Code. 4.3. Qualification of Incentive Stock Options. No Incentive Stock ---------------------------------------- Option shall be granted to any person who is not an Employee. 4.4. Granting of Options to Employees and Consultants. ------------------------------------------------ (a) The Committee shall from time to time, in its absolute discretion, and subject to applicable limitations of the Plan: (i) Determine which Employees are key Employees and select from among the key Employees or Consultants (including Employees or Consultants who have previously received Awards under the Plan) such of them as in its opinion should be granted Options; (ii) Subject to the Award Limit, determine the number of shares to be subject to such Options granted to the selected key Employees or Consultants; (iii) Subject to Section 4.3, determine whether such Options are to be Incentive Stock Options or Non-Qualified Stock Options and whether such Options are to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code; and (iv) Determine the terms and conditions of such Options, consistent with the Plan; provided, however, that the terms and conditions -------- ------- of Options intended to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code shall include, but not be limited to, such terms and conditions as may be necessary to meet the applicable provisions of Section 162(m) of the Code. 8 (b) Upon the selection of a key Employee or Consultant to be granted an Option, the Committee shall instruct the Secretary of the Company to issue the Option and may impose such conditions on the grant of the Option as it deems appropriate. (c) Any Incentive Stock Option granted under the Plan may be modified by the Committee, with the consent of the Holder, to disqualify such Option from treatment as an "incentive stock option" under Section 422 of the Code. 4.5. Granting of Options to Independent Directors. -------------------------------------------- (a) During the term of the Plan, a person who is an Independent Director at the time of his or her initial election to the Board automatically shall be granted an Option to purchase 5,000 shares of Common Stock (subject to adjustment as provided in Section 11.3). Members of the Board who are employees of the Company who subsequently retire from the Company and remain on the Board will not receive an initial Option grant pursuant to the preceding sentence. (b) Notwithstanding Section 4.5(a), the Board shall from time to time, in its absolute discretion, and subject to applicable limitations of the Plan: (i) Select from among the Independent Directors (including Independent Directors) who have previously received Options under the Plan such of them as in its opinion should be granted Options; (ii) Subject to the Award Limit, determine the number of shares to be subject to such Options granted to the selected Independent Directors; (iv) Subject to the provisions of Article V, determine the terms and conditions of such Options, consistent with the Plan. (c) All the foregoing Option grants authorized by this Section 4.5 are subject to stockholder approval of the Plan. ARTICLE V. TERMS OF OPTIONS 5.1. Option Price. The price per share of the shares subject to each ------------ Option granted to Employees and Consultants shall be set by the Committee; provided, however, that such price shall be no less than 85% of the Fair Market - -------- ------- Value of a share of Common Stock on the date the Option is granted and: (a) in the case of Incentive Stock Options, such price shall not be less than 100% of the Fair Market Value of a share of Common Stock on the date the Option is granted (or the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code); and 9 (b) in the case of Options granted to an individual then owning (within the meaning of Section 424(d) of the Code) more than 10% of the total combined voting power of all classes of stock of the Company or any Subsidiary or parent corporation thereof (within the meaning of Section 422 of the Code), such price shall not be less than 110% of the Fair Market Value of a share of Common Stock on the date the Option is granted (or the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code). 5.2. Option Term. The term of an Option granted to an Employee or ----------- consultant shall be set by the Committee in its discretion; provided, however, -------- -------- that the term of any Option shall not be more than ten (10) years from the date the Option is granted or, in the case of any Incentive Stock Option, five (5) years from the date the Incentive Stock Option is granted if the Incentive Stock Option is granted to an individual then owning (within the meaning of Section 424(d) of the Code) more than 10% of the total combined voting power of all classes of stock of the Company or any Subsidiary or parent corporation thereof (within the meaning of Section 422 of the Code). Except as limited by applicable state law or the requirements of Section 422 of the Code and regulations and rulings thereunder applicable to Incentive Stock Options, the Committee may extend the term of any outstanding Option in connection with any Termination of Employment or Termination of Consultancy of the Holder, or amend any other term or condition of such Option relating to such a termination. 5.3. Option Vesting -------------- (a) The period during which the right to exercise, in whole or in part, an Option granted to an Employee or a Consultant vests in the Holder shall be set by the Committee and the Committee may determine that an Option may not be exercised in whole or in part for a specified period after it is granted; provided, however, that the rate at which an Option -------- ------- granted to an Employee or a Consultant vests shall be no less than 20% per year over five (5) years from the date the Option is granted, and provided, -------- further, that, unless the Committee otherwise provides in the terms of the ------- Award Agreement or otherwise, no Option shall be exercisable by any Holder who is then subject to Section 16 of the Exchange Act within the period ending six months and one day after the date the Option is granted. At any time after grant of an Option, the Committee may, in its sole and absolute discretion and subject to whatever terms and conditions it selects, accelerate the period during which an Option granted to an Employee or Consultant vests. (b) No portion of an Option granted to an Employee or Consultant which is unexercisable at Termination of Employment or Termination of Consultancy, as applicable, shall thereafter become exercisable, except as may be otherwise provided by the Committee either in the Award Agreement or by action of the Committee following the grant of the Option. (c) To the extent that the aggregate Fair Market Value of stock with respect to which "incentive stock options" (within the meaning of Section 422 of the Code, but without regard to Section 422(d) of the Code) are exercisable for the first time by a Holder during any calendar year (under the Plan and all other incentive stock option 10 plans of the Company and any parent or subsidiary corporation, within the meaning of Section 422 of the Code) of the Company, exceeds $100,000, such Options shall be treated as Non-Qualified Options to the extent required by Section 422 of the Code. The rule set forth in the preceding sentence shall be applied by taking Options into account in the order in which they were granted. For purposes of this Section 5.3(c), the Fair Market Value of stock shall be determined as of the time the Option with respect to such stock is granted. 5.4. Terms of Options Granted to Independent Directors. The price ------------------------------------------------- per share of the shares subject to each Option granted to an Independent Director shall equal 100% of the Fair Market Value of a share of Common Stock on the date the Option is granted. Options granted to Independent Directors shall become exercisable in cumulative annual installments of 25% on each of the first, second, third and fourth anniversaries of the date of Option grant and, subject to Section 6.7, the term of each Option granted to an Independent Director shall be ten (10) years from the date the Option is granted. No portion of an Option which is unexercisable at Termination of Directorship shall thereafter become exercisable. 5.5. Substitute Awards. ----------------- Notwithstanding the foregoing provisions of this Article V to the contrary, in the case of an Option that is a Substitute Award, the price per share of the shares subject to such Option may be less than the Fair Market Value per share on the date of grant, provided, that the excess of: --------- (a) the aggregate Fair Market Value (as of the date such Substitute Award is granted) of the shares subject to the Substitute Award; over (b) the aggregate exercise price thereof; does not exceed the excess of; (c) the aggregate fair market value (as of the time immediately preceding the transaction giving rise to the Substitute Award, such fair market value to be determined by the Committee) of the shares of the predecessor entity that were subject to the grant assumed or substituted for by the Company; over (d) the aggregate exercise price of such shares. ARTICLE VI. EXERCISE OF OPTIONS 6.1. Partial Exercise. An exercisable Option may be exercised in ---------------- whole or in part. However, an Option shall not be exercisable with respect to fractional shares and the Administrator may require that, by the terms of the Option, a partial exercise be with respect to a minimum number of shares. 6.2. Manner of Exercise. All or a portion of an exercisable Option ------------------ shall be deemed exercised upon delivery of all of the following to the Secretary of the Company or his office: 11 (a) A written notice complying with the applicable rules established by the Administrator stating that the Option, or a portion thereof, is exercised. The notice shall be signed by the Holder or other person then entitled to exercise the Option or such portion of the Option; (b) Such representations and documents as the Administrator, in its absolute discretion, deems necessary or advisable to effect compliance with all applicable provisions of the Securities Act and any other federal or state securities laws or regulations. The Administrator may, in its absolute discretion, also take whatever additional actions it deems appropriate to effect such compliance including, without limitation, placing legends on share certificates and issuing stop-transfer notices to agents and registrars; (c) In the event that the Option shall be exercised pursuant to Section 11.1 by any person or persons other than the Holder, appropriate proof of the right of such person or persons to exercise the Option; and (d) Full cash payment to the Secretary of the Company for the shares with respect to which the Option, or portion thereof, is exercised. However, the Administrator, may in its discretion (i) allow a delay in payment up to thirty (30) days from the date the Option, or portion thereof, is exercised; (ii) allow payment, in whole or in part, through the delivery of shares of Common Stock which have been owned by the Holder for at least six months, duly endorsed for transfer to the Company with a Fair Market Value on the date of delivery equal to the aggregate exercise price of the Option or exercised portion thereof; (iii) allow payment, in whole or in part, through the surrender of shares of Common Stock then issuable upon exercise of the Option having a Fair Market Value on the date of Option exercise equal to the aggregate exercise price of the Option or exercised portion thereof; (iv) allow payment, in whole or in part, through the delivery of property of any kind which constitutes good and valuable consideration; (v) allow payment, in whole or in part, through the delivery of a full recourse promissory note bearing interest (at no less than such rate as shall then preclude the imputation of interest under the Code) and payable upon such terms as may be prescribed by the Administrator; (vi) allow payment, in whole or in part, through the delivery of a notice that the Holder has placed a market sell order with a broker with respect to shares of Common Stock then issuable upon exercise of the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Company in satisfaction of the Option exercise price, provided that payment of such proceeds is then made to the Company -------- upon settlement of such sale; or (vii) allow payment through any combination of the consideration provided in the foregoing subparagraphs (ii), (iii), (iv), (v) and (vi). In the case of a promissory note, the Administrator may also prescribe the form of such note and the security to be given for such note. The Option may not be exercised, however, by delivery of a promissory note or by a loan from the Company when or where such loan or other extension of credit is prohibited by law. 6.3. Conditions to Issuance of Stock Certificates. The Company shall -------------------------------------------- not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of any Option or portion thereof prior to fulfillment of all of the following conditions: 12 (a) The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; (b) The completion of any registration or other qualification of such shares under any state or federal law, or under the rulings or regulations of the Securities and Exchange Commission or any other governmental regulatory body which the Administrator shall, in its absolute discretion, deem necessary or advisable; (c) The obtaining of any approval or other clearance from any state or federal governmental agency which the Administrator shall, in its absolute discretion, determine to be necessary or advisable; (d) The lapse of such reasonable period of time following the exercise of the Option as the Administrator may establish from time to time for reasons of administrative convenience; and (e) The receipt by the Company of full payment for such shares, including payment of any applicable withholding tax, which in the discretion of the Administrator may be in the form of consideration used by the Holder to pay for such shares under Section 6.2(d). 6.4. Rights as Stockholders. Holders shall not be, nor have any of ---------------------- the rights or privileges of, stockholders of the Company in respect of any shares purchasable upon the exercise of any part of an Option unless and until certificates representing such shares have been issued by the Company to such Holders. 6.5. Ownership and Transfer Restrictions. The Administrator, in its ----------------------------------- absolute discretion, may impose such restrictions on the ownership and transferability of the shares purchasable upon the exercise of an Option as it deems appropriate. Any such restriction shall be set forth in the respective Award Agreement and may be referred to on the certificates evidencing such shares. The Holder shall give the Company prompt notice of any disposition of shares of Common Stock acquired by exercise of an Incentive Stock Option within (a) two years from the date of granting (including the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code) such Option to such Holder or (b) one year after the transfer of such shares to such Holder. 6.6. Limitations on Exercise of Options Granted to Employees or ---------------------------------------------------------- Consultants. Notwithstanding anything herein to the contrary, except in the - ----------- case of Termination of Employment for cause or Termination of Consultancy for cause (as determined by the Administrator), to the extent that any portion of an Option granted to an Employee or Consultant is exercisable at Termination of Employment or Termination of Consultancy, as applicable, such portion shall be exercisable following Termination of Employment or Termination of Consultancy for a period which shall be determined by the Administrator in its sole discretion; provided, however, that such period shall end no sooner than -------- ------- (a) The earlier of (x) the expiration of the Option's term or (y) the expiration of six (6) months from the date of Termination of Employment or Termination 13 of Consultancy, as applicable, if the Holder's termination is caused by the Holder's death or Disability; or (b) The earlier of (x) the expiration of the Option's term, or (y) the expiration of at least thirty (30) days from the date of Termination of Employment or Termination of Consultancy, as applicable, if the Holder's termination is caused by other than the Holder's death or Disability. In the case of Termination of Employment or Termination of Consultancy for cause (as determined by the Administrator), the period within which any portion of an Option which is exercisable at the date of the Holder's termination may be exercised following such termination shall be determined by the Administrator in its sole discretion, but in no event shall extend beyond the expiration of the Option's term. 6.7. Limitations on Exercise of Options Granted to Independent --------------------------------------------------------- Directors. No Option granted to an Independent Director may be exercised to any - --------- extent by anyone after the first to occur of the following events: (a) The expiration of twelve (12) months from the date of the Holder's death; (b) the expiration of twelve (12) months from the date of the Holder's Termination of Directorship by reason of his permanent and total disability (within the meaning of Section 22(e)(3) of the Code); (c) the expiration of three (3) months from the date of the Holder's Termination of Directorship for any reason other than such Holder's death or his permanent and total disability, unless the Holder dies within said three-month period; or (d) The expiration of ten (10) years from the date the Option was granted. 6.8. Additional Limitations on Exercise of Options. Holders may be --------------------------------------------- required to comply with any timing or other restrictions with respect to the settlement or exercise of an Option, including a window-period limitation, as may be imposed in the discretion of the Administrator. ARTICLE VII. AWARD OF RESTRICTED STOCK 7.1. Eligibility. Subject to the Award Limit, Restricted Stock may ----------- be awarded to any Employee who the Committee determines is a key Employee or any Consultant who the Committee determines should receive such an Award. 7.2. Award of Restricted Stock ------------------------- (a) The Committee may from time to time, in its absolute discretion: 14 (i) Determine which Employees are key Employees and select from among the key Employees or Consultants (including Employees or Consultants who have previously received other awards under the Plan) such of them as in its opinion should be awarded Restricted Stock; and (ii) Determine the purchase price, if any, and other terms and conditions applicable to such Restricted Stock, consistent with the Plan. (b) The Committee shall establish the purchase price, if any, and form of payment for Restricted Stock; provided, however, that such -------- ------- purchase price shall be no less than 85% of the Fair Market Value of a share of Common Stock on the date the award of Restricted Stock is made or at the time the purchase of Restricted Stock is consummated, unless otherwise permitted by applicable state law, and provided, further, that, -------- ------- in the case of the award of Restricted Stock to an individual then owning more than 10% of the total combined voting power of all classes of stock of the Company or any Subsidiary or parent corporation thereof, such purchase price shall be no less than 100% of the Fair Market Value of a share of Common Stock on the date the award of Restricted Stock is made or at the time the purchase of Restricted Stock is consummated, unless otherwise permitted by applicable state law. In all cases, legal consideration shall be required for each issuance of Restricted Stock. (c) Upon the selection of a key Employee or Consultant to be awarded Restricted Stock, the Committee shall instruct the Secretary of the Company to issue such Restricted Stock and may impose such conditions on the issuance of such Restricted Stock as it deems appropriate. 7.3. Rights as Stockholders. Subject to Section 7.4, upon delivery ---------------------- of the shares of Restricted Stock to the escrow holder pursuant to Section 7.6, the Holder shall have, unless otherwise provided by the Committee, all the rights of a stockholder with respect to said shares, subject to the restrictions in his Award Agreement, including the right to receive all dividends and other distributions paid or made with respect to the shares; provided, however, that -------- ------- in the discretion of the Committee, any extraordinary distributions with respect to the Common Stock shall be subject to the restrictions set forth in Section 7.4. 7.4. Restriction. All shares of Restricted Stock issued under the ----------- Plan (including any shares received by holders thereof with respect to shares of Restricted Stock as a result of stock dividends, stock splits or any other form of recapitalization) shall, in the terms of each individual Award Agreement, be subject to such restrictions as the Committee shall provide, which restrictions may include, without limitation, restrictions concerning voting rights and transferability and restrictions based on duration of employment with the Company, Company performance and individual performance; provided, however, -------- ------- that, unless the Committee otherwise provides in the terms of the Award Agreement or otherwise, no share of Restricted Stock granted to a person subject to Section 16 of the Exchange Act shall be sold, assigned or otherwise transferred until at least six months and one day have elapsed from the date on which the Restricted Stock was issued, and provided, further, that, except with -------- ------- respect to shares of Restricted Stock granted to Section 162(m) Participants, by action taken after the Restricted Stock is issued, the Committee may, on such terms and conditions as it may determine 15 to be appropriate, remove any or all of the restrictions imposed by the terms of the Award Agreement. Restricted Stock may not be sold or encumbered until all restrictions are terminated or expire. If no consideration was paid by the Holder upon issuance, a Holder's rights in unvested Restricted Stock shall lapse, and such Restricted Stock shall be surrendered to the Company without consideration, upon Termination of Employment or, if applicable, upon Termination of Consultancy with the Company; provided, however, that the -------- ------- Committee in its sole and absolute discretion may provide that such rights shall not lapse in the event of a Termination of Employment following a "change of ownership or control" (within the meaning of Treasury Regulation Section 1. 162- 27(e)(2)(v) or any successor regulation thereto) of the Company or because of the Holder's death or disability; provided, further, except with respect to -------- ------- shares of Restricted Stock granted to Section 162(m) Participants, the Committee in its sole and absolute discretion may provide that no such lapse or surrender shall occur in the event of a Termination of Employment, or a Termination of Consultancy, without cause or following any change in control of the Company or because of the Holder's retirement, or otherwise. 7.5. Repurchase of Restricted Stock. The Committee shall provide in ------------------------------ the terms of each individual Award Agreement that the Company shall have the right to repurchase from the Holder the Restricted Stock then subject to restrictions under the Award Agreement within ninety (90) days after a Termination of Employment or, if applicable, after a Termination of Consultancy between the Holder and the Company, at a cash price per share equal to the price paid by the Holder for such Restricted Stock; provided, however, that such right -------- ------- of repurchase shall lapse at a rate of at least 20% of the shares of Restricted Stock per year over five (5) years from the date the Restricted Stock is awarded, and provided, further, that the Committee in its sole and absolute -------- ------- discretion may provide that no such right of repurchase shall exist in the event of a Termination of Employment following a "change of ownership or control" (within the meaning of Treasury Regulation Section 1. 162-27(e)(2)(v) or any successor regulation thereto) of the Company or because of the Holder's death or disability; provided, further, that, except with respect to shares of Restricted -------- ------- Stock granted to Section 162(m) Participants, the Committee in its sole and absolute discretion may provide that no such right of repurchase shall exist in the event of a Termination of Employment or a Termination of Consultancy without cause or following any change in control of the Company or because of the Holder's retirement, or otherwise. 7.6. Escrow. The Secretary of the Company or such other escrow ------ holder as the Committee may appoint shall retain physical custody of each certificate representing Restricted Stock until all of the restrictions imposed under the Award Agreement with respect to the shares evidenced by such certificate expire or shall have been removed. 7.7. Legend. In order to enforce the restrictions imposed upon ------ shares of Restricted Stock hereunder, the Committee shall cause a legend or legends to be placed on certificates representing all shares of Restricted Stock that are still subject to restrictions under Award Agreements, which legend or legends shall make appropriate reference to the conditions imposed thereby. 7.8. Section 83(b) Election. If a Holder makes an election under ---------------------- Section 83(b) of the Code, or any successor section thereto, to be taxed with respect to the Restricted Stock as of the date of transfer of the Restricted Stock rather than as of the date or dates upon which the 16 Holder would otherwise be taxable under Section 83(a) of the Code, the Holder shall deliver a copy of such election to the Company immediately after filing such election with the Internal Revenue Service. ARTICLE VIII. PERFORMANCE AWARDS, DIVIDEND EQUIVALENTS, DEFERRED STOCK AND STOCK PAYMENTS 8.1. Eligibility. Subject to the Award Limit, one or more ----------- Performance Awards, Dividend Equivalents, awards of Deferred Stock, and/or Stock Payments may be granted to any Employee whom the Committee determines is a key Employee or any Consultant whom the Committee determines should receive such an Award. 8.2. Performance Awards. Any key Employee or Consultant selected by ------------------ the Committee may be granted one or more Performance Awards. The value of such Performance Awards may be linked to any one or more of the Performance Criteria or other specific performance criteria determined appropriate by the Committee, in each case on a specified date or dates or over any period or periods determined by the Committee. In making such determinations, the Committee shall consider (among such other factors as it deems relevant in light of the specific type of award) the contributions, responsibilities and other compensation of the particular key Employee or Consultant. 8.3. Dividend Equivalents. -------------------- (a) Any key Employee or Consultant selected by the Committee may be granted Dividend Equivalents based on the dividends declared on Common Stock, to be credited as of dividend payment dates, during the period between the date a Stock Appreciation Right, Deferred Stock or Performance Award is granted, and the date such Stock Appreciation Right, Deferred Stock or Performance Award is exercised, vests or expires, as determined by the Committee. Such Dividend Equivalents shall be converted to cash or additional shares of Common Stock by such formula and at such time and subject to such limitations as may be determined by the Committee. (b) Any Holder of an Option who is an Employee or Consultant selected by the Committee may be granted Dividend Equivalents based on the dividends declared on Common Stock, to be credited as of dividend payment dates, during the period between the date an Option is granted, and the date such Option is exercised, vests or expires, as determined by the Committee. Such Dividend Equivalents shall be converted to cash or additional shares of Common Stock by such formula and at such time and subject to such limitations as may be determined by the Committee. (c) Any Holder of an Option who is an Independent Director selected by the Board may be granted Dividend Equivalents based on the dividends declared on Common Stock, to be credited as of dividend payment dates, during the period between the date an Option is granted, and the date such Option is exercised, vests or expires, as determined by the Board. Such Dividend Equivalents shall be converted to cash or 17 additional shares of Common Stock by such formula and at such time and subject to such limitations as may be determined by the Board. (d) Dividend Equivalents granted with respect to Options intended to be qualified performance-based compensation for purposes of Section 162(m) of the Code shall be payable, with respect to pre-exercise periods, regardless of whether such Option is subsequently exercised. 8.4. Stock Payments. Any key Employee or Consultant selected by the -------------- Committee may receive Stock Payments in the manner determined from time to time by the Committee. The number of shares shall be determined by the Committee and may be based upon the Performance Criteria or other specific performance criteria determined appropriate by the Committee, determined on the date such Stock Payment is made or on any date thereafter. 8.5. Deferred Stock. Any key Employee or Consultant selected by the -------------- Committee may be granted an award of Deferred Stock in the manner determined from time to time by the Committee. The number of shares of Deferred Stock shall be determined by the Committee and may be linked to the Performance Criteria or other specific performance criteria determined to be appropriate by the Committee, in each case on a specified date or dates or over any period or periods determined by the Committee. Common Stock underlying a Deferred Stock award will not be issued until the Deferred Stock award has vested, pursuant to a vesting schedule or performance criteria set by the Committee. Unless otherwise provided by the Committee, a Holder of Deferred Stock shall have no rights as a Company stockholder with respect to such Deferred Stock until such time as the Award has vested and the Common Stock underlying the Award has been issued. 8.6. Term. The term of a Performance Award, Dividend Equivalent, ---- award of Deferred Stock and/or Stock Payment shall be set by the Committee in its discretion. 8.7. Exercise or Purchase Price. The Committee may establish the -------------------------- exercise or purchase price of a Performance Award, shares of Deferred Stock, or shares received as a Stock Payment; provided, however, that such price shall not -------- ------- be less than the par value for a share of Common Stock, unless otherwise permitted by applicable state law. 8.8. Exercise Upon Termination of Employment, Termination of ------------------------------------------------------- Consultancy or Termination of Directorship. A Performance Award, Dividend - ------------------------------------------ Equivalent, award of Deferred Stock and/or Stock Payment is exercisable or payable only while the Holder is an Employee, Consultant or Independent Director, as applicable; provided, however, that the Administrator in its sole -------- ------- and absolute discretion may provide that the Performance Award, Dividend Equivalent, award of Deferred Stock and/or Stock Payment may be exercised or paid subsequent to a Termination of Employment following a "change of control or ownership" (within the meaning of Section 1. 162-27(e)(2)(v) or any successor regulation thereto) of the Company; provided, further, that except with respect -------- ------- to Performance Awards granted to Section 162(m) Participants, the Administrator in its sole and absolute discretion may provide that Performance Awards may be exercised or paid following a Termination of Employment or a Termination of Consultancy without cause, or following a change in control of the Company, or because of a Holder's retirement, death or disability, or otherwise. 18 8.9. Form of Payment. Payment of the amount determined under Section --------------- 8.2 or 8.3 above shall be in cash, in Common Stock or a combination of both, as determined by the Committee. To the extent any payment under this Article VIII is effected in Common Stock, it shall be made subject to satisfaction of all provisions of Section 6.3. ARTICLE IX. STOCK APPRECIATION RIGHTS 9.1. Grant of Stock Appreciation Rights. A Stock Appreciation Right ---------------------------------- may be granted to any key Employee or Consultant selected by the Committee. A Stock Appreciation Right may be granted (a) in connection and simultaneously with the grant of an Option, (b) with respect to a previously granted Option, or (c) independent of an Option. A Stock Appreciation Right shall be subject to such terms and conditions not inconsistent with the Plan as the Committee shall impose and shall be evidenced by an Award Agreement. 9.2. Coupled Stock Appreciation Rights. --------------------------------- (a) A Coupled Stock Appreciation Right ("CSAR") shall be related to a particular Option and shall be exercisable only when and to the extent the related Option is exercisable. (b) A CSAR may be granted to the Holder for no more than the number of shares subject to the simultaneously or previously granted Option to which it is coupled. (c) A CSAR shall entitle the Holder (or other person entitled to exercise the Option pursuant to the Plan) to surrender to the Company unexercised a portion of the Option to which the CSAR relates (to the extent then exercisable pursuant to its terms) and to receive from the Company in exchange therefor an amount determined by multiplying the difference obtained by subtracting the Option exercise price from the Fair Market Value of a share of Common Stock on the date of exercise of the CSAR by the number of shares of Common Stock with respect to which the CSAR shall have been exercised, subject to any limitations the Committee may impose. 9.3. Independent Stock Appreciation Rights. ------------------------------------- (a) An Independent Stock Appreciation Right ("ISAR") shall be unrelated to any Option and shall have a term set by the Committee. An ISAR shall be exercisable in such installments as the Committee may determine. An ISAR shall cover such number of shares of Common Stock as the Committee may determine; provided, however, that unless the Committee -------- ------- otherwise provides in the terms of the ISAR or otherwise, no ISAR granted to a person subject to Section 16 of the Exchange Act shall be exercisable until at least six months have elapsed from (but excluding) the date on which the Option was granted. The exercise price per share of Common Stock subject to each ISAR shall be set by the Committee. An ISAR is exercisable only while the Holder is an Employee or Consultant; provided that the Committee may determine that the ISAR may be exercised subsequent to Termination of Employment or Termination of 19 Consultancy without cause, or following a Change in Control of the Company, or because of the Holder's retirement, death or disability, or otherwise. (b) An ISAR shall entitle the Holder (or other person entitled to exercise the ISAR pursuant to the Plan) to exercise all or a specified portion of the ISAR (to the extent then exercisable pursuant to its terms) and to receive from the Company an amount determined by multiplying the difference obtained by subtracting the exercise price per share of the ISAR from the Fair Market Value of a share of Common Stock on the date of exercise of the ISAR by the number of shares of Common Stock with respect to which the ISAR shall have been exercised, subject to any limitations the Committee may impose. 9.4. Payment and Limitations on Exercise. ----------------------------------- (a) Payment of the amounts determined under Section 9.2(c) and 9.3(b) above shall be in cash, in Common Stock (based on its Fair Market Value as of the date the Stock Appreciation Right is exercised) or a combination of both, as determined by the Committee. To the extent such payment is effected in Common Stock it shall be made subject to satisfaction of all provisions of Section 6.3 above pertaining to Options. (b) Holders of Stock Appreciation Rights may be required to comply with any timing or other restrictions with respect to the settlement or exercise of a Stock Appreciation Right, including a window-period limitation, as may be imposed in the discretion of the Committee. ARTICLE X. ADMINISTRATION 10.1. Compensation Committee. Prior to the Company's initial ---------------------- registration of Common Stock under Section 12 of the Exchange Act, the Compensation Committee shall consist of the entire Board. Following such registration, The Compensation Committee (or another committee or a subcommittee of the Board assuming the functions of the Committee under the Plan) shall consist solely of two or more Independent Directors appointed by and holding office at the pleasure of the Board, each of whom is both a "non-employee director" as defined by Rule 16b-3 and an "outside director" for purposes of Section 162(m) of the Code. Appointment of Committee members shall be effective upon acceptance of appointment. Committee members may resign at any time by delivering written notice to the Board. Vacancies in the Committee may be filled by the Board. 10.2. Duties and Powers of Committee. It shall be the duty of the ------------------------------ Committee to conduct the general administration of the Plan in accordance with its provisions. The Committee shall have the power to interpret the Plan and the Award Agreements, and to adopt such rules for the administration, interpretation, and application of the Plan as are consistent therewith, to interpret, amend or revoke any such rules and to amend any Award Agreement provided that the rights or obligations of the Holder of the Award that is the subject of any such Award Agreement are not affected adversely. Any such grant or award under the Plan need not be the same with respect to each Holder. Any such interpretations and rules with respect to Incentive Stock 20 Options shall be consistent with the provisions of Section 422 of the Code. In its absolute discretion, the Board may at any time and from time to time exercise any and all rights and duties of the Committee under the Plan except with respect to matters which under Rule 16b-3 or Section 162(m) of the Code, or any regulations or rules issued thereunder, are required to be determined in the sole discretion of the Committee. Notwithstanding the foregoing, the full Board, acting by a majority of its members in office, shall conduct the general administration of the Plan with respect to Options and Dividend Equivalents granted to Independent Directors. 10.3. Majority Rule; Unanimous Written Consent. The Committee shall ---------------------------------------- act by a majority of its members in attendance at a meeting at which a quorum is present or by a memorandum or other written instrument signed by all members of the Committee. 10.4. Compensation; Professional Assistance; Good Faith Actions. --------------------------------------------------------- Members of the Committee shall receive such compensation, if any, for their services as members as may be determined by the Board. All expenses and liabilities which members of the Committee incur in connection with the administration of the Plan shall be borne by the Company. The Committee may, with the approval of the Board, employ attorneys, consultants. accountants, appraisers, brokers, or other persons. The Committee, the Company and the Company's officers and Directors shall be entitled to rely upon the advice, opinions or valuations of any such persons. All actions taken and all interpretations and determinations made by the Committee or the Board in good faith shall be final and binding upon all Holders, the Company and all other interested persons. No members of the Committee or Board shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or Awards, and all members of the Committee and the Board shall be fully protected by the Company in respect of any such action, determination or interpretation. 10.5. Delegation of Authority to Grant Awards. The Committee may, --------------------------------------- but need not, delegate from time to time some or all of its authority to grant Awards under the Plan to a committee consisting of one or more members of the Committee or of one or more officers of the Company; provided, however, that the Committee may not delegate its authority to grant Awards to individuals (i) who are subject on the date of the grant to the reporting rules under Section 16(a) of the Exchange Act, (ii) who are Section 162(m) Participants or (iii) who are officers of the Company who are delegated authority by the Committee hereunder. Any delegation hereunder shall be subject to the restrictions and limits that the Committee specifies at the time of such delegation of authority and may be rescinded at any time by the Committee. At all times, any committee appointed under this Section 10.5 shall serve in such capacity at the pleasure of the Committee. ARTICLE XI. MISCELLANEOUS PROVISIONS 11.1. Not Transferable. No Award under the Plan may be sold, ---------------- pledged, assigned or transferred in any manner other than by will or the laws of descent and distribution or, subject to the consent of the Administrator pursuant to a DRO, unless and until such Award has been exercised, or the shares underlying such Award have been issued, and all restrictions applicable to such shares have lapsed. No Award or interest or right therein shall be liable for 21 the debts, contracts or engagements of the Holder or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence. During the lifetime of the Holder, only he may exercise an Option or other Award (or any portion thereof) granted to him under the Plan, unless it has been disposed of with the consent of the Administrator pursuant to a DRO. After the death of the Holder, any exercisable portion of an Option or other Award may, prior to the time when such portion becomes unexercisable under the Plan or the applicable Award Agreement, be exercised by his personal representative or by any person empowered to do so under the deceased Holder's will or under the then applicable laws of descent and distribution. 11.2. Amendment, Suspension or Termination of the Plan. Except as ------------------------------------------------ otherwise provided in this Section 11.2, the Plan may be wholly or partially amended or otherwise modified, suspended or terminated at any time or from time to time by the Administrator. However, without approval of the Company's stockholders given within twelve months before or after the action by the Administrator, no action of the Administrator may, except as provided in Section 11.3, increase the limits imposed in Section 2.1 on the maximum number of shares which may be issued under the Plan. No amendment, suspension or termination of the Plan shall, without the consent of the Holder alter or impair any rights or obligations under any Award theretofore granted or awarded, unless the Award itself otherwise expressly so provides. No Awards may be granted or awarded during any period of suspension or after termination of the Plan, and in no event may any Incentive Stock Option be granted under the Plan after the first to occur of the following events: (a) The expiration of ten years from the date the Plan is adopted by the Board; or (b) The expiration of ten years from the date the Plan is approved by the Company's stockholders under Section 11.4. 11.3. Changes in Common Stock or Assets of the Company, Acquisition ------------------------------------------------------------- or Liquidation of the Company and Other Corporate Events. - -------------------------------------------------------- (a) Subject to Section 11.3(d), in the event that the Administrator determines that any dividend or other distribution (whether in the form of cash, Common Stock, other securities, or other property), recapitalization, reclassification, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, liquidation, dissolution, or sale, transfer, exchange or other disposition of all or substantially all of the assets of the Company, or exchange of Common Stock or other securities of the Company, issuance of warrants or other rights to purchase Common Stock or other securities of the Company, or other similar corporate transaction or event, in the Administrator's sole discretion, affects the Common Stock such that an adjustment is determined by the Administrator to be appropriate in order to prevent dilution or 22 enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to an Award, then the Administrator shall, in such manner as it may deem equitable, adjust any or all of (i) the number and kind of shares of Common Stock (or other securities or property) with respect to which Awards may be granted or awarded (including, but not limited to, adjustments of the limitations in Section 2.1 on the maximum number and kind of shares which may be issued and adjustments of the Award Limit), (ii) the number and kind of shares of Common Stock (or other securities or property) subject to outstanding Awards, and (iii) the grant or exercise price with respect to any Award. (b) Subject to Section 11.3(d), in the event of any transaction or event described in Section 11.3(a) or any unusual or nonrecurring transactions or events affecting the Company, any affiliate of the Company, or the financial statements of the Company or any affiliate, or of changes in applicable laws, regulations, or accounting principles, the Administrator, in its sole and absolute discretion, and on such terms and conditions as it deems appropriate, either by the terms of the Award or by action taken prior to the occurrence of such transaction or event and either automatically or upon the Holder's request, is hereby authorized to take any one or more of the following actions whenever the Administrator determines that such action is appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to any Award under the Plan, to facilitate such transactions or events or to give effect to such changes in laws, regulations or principles: (i) To provide for either the purchase of any such Award for an amount of cash equal to the amount that could have been attained upon the exercise of such Award or realization of the Holder's rights had such Award been currently exercisable or payable or fully vested or the replacement of such Award with other rights or property selected by the Administrator in its sole discretion; (ii) To provide that the Award cannot vest, be exercised or become payable after such event; (iii) To provide that such Award shall be exercisable as to all shares covered thereby, notwithstanding anything to the contrary in Section 5.3 or 5.4 or the provisions of such Award; 23 (iv) To provide that such Award be assumed by the successor or survivor corporation, or a parent or subsidiary thereof, or shall be substituted for by similar options, rights or awards covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices; and (v) To make adjustments in the number and type of shares of Common Stock (or other securities or property) subject to outstanding Awards, and in the number and kind of outstanding Restricted Stock or Deferred Stock and/or in the terms and conditions of (including the grant or exercise price), and the criteria included in, outstanding options, rights and awards and options, rights and awards which may be granted in the future. (vi) To provide that, for a specified period of time prior to such event, the restrictions imposed under an Award Agreement upon some or all shares of Restricted Stock or Deferred Stock may be terminated, and, in the case of Restricted Stock, some or all shares of such Restricted Stock may cease to be subject to repurchase under Section 7.5 or forfeiture under Section 7.4 after such event. (c) Subject to Sections 11.3(d), 3.2 and 3.3, the Administrator may, in its discretion, include such further provisions and limitations in any Award, agreement or certificate, as it may deem equitable and in the best interests of the Company. (d) With respect to Awards which are granted to Section 162(m) Participants and are intended to qualify as performance-based compensation under Section 162(m)(4)(C), no adjustment or action described in this Section 11.3 or in any other provision of the Plan shall be authorized to the extent that such adjustment or action would cause such Award to fail to so qualify under Section 162(m)(4)(C), or any successor provisions thereto. No adjustment or action described in this Section 11.3 or in any other provision of the Plan shall be authorized to the extent that such adjustment or action would cause the Plan to violate Section 422(b)(1) of the Code. Furthermore, no such adjustment or action shall be authorized to the extent such adjustment or action would result in short-swing profits liability under Section 16 or violate the exemptive conditions of Rule 16b- 3 unless the Administrator determines that the Award is not to comply with such exemptive conditions. The number of shares of Common Stock subject to any Award shall always be rounded to the next whole number. (e) Notwithstanding the foregoing, in the event that the Company becomes a party to a transaction that is intended to qualify for "pooling of interests" accounting treatment and, but for one or more of the provisions of this Plan or any Award Agreement would so qualify, then this Plan and any Award Agreement shall be interpreted so as to preserve such accounting treatment, and to the extent that any provision of the Plan or any Award Agreement would disqualify the transaction from 24 pooling of interests accounting treatment (including, if applicable, an entire Award Agreement), then such provision shall be null and void. All determinations to be made in connection with the preceding sentence shall be made by the independent accounting firm whose opinion with respect to "pooling of interests"' treatment is required as a condition to the Company's consummation of such transaction. (f) The existence of the Plan, the Award Agreement and the Awards granted hereunder shall not affect or restrict in any way the right or power of the Company or the shareholders of the Company to make or authorize any adjustment, recapitalization, reorganization or other change in the Company's capital structure or its business, any merger or consolidation of the Company, any issue of stock or of options, warrants or rights to purchase stock or of bonds, debentures, preferred or prior preference stocks whose rights are superior to or affect the Common Stock or the rights thereof or which are convertible into or exchangeable for Common Stock, 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, whether of a similar character or otherwise. 11.4. Approval of Plan by Stockholders. The Plan will be submitted -------------------------------- for the approval of the Company's stockholders within twelve months after the date of the Board's initial adoption of the Plan. Awards may be granted or awarded prior to such stockholder approval, provided that such Awards shall not be exercisable nor shall such Awards vest prior to the time when the Plan is approved by the stockholders, and provided further that if such approval has not been obtained at the end of said twelve-month period, all Awards previously granted or awarded under the Plan shall thereupon be canceled and become null and void. In addition, if the Board determines that Awards other than Options or Stock Appreciation Rights which may be granted to Section 162(m) Participants should continue to be eligible to qualify as performance-based compensation under Section 162(m)(4)(C) of the Code, the Performance Criteria must be disclosed to and approved by the Company's stockholders no later than the first stockholder meeting that occurs in the fifth year following the year in which the Company's stockholders previously approved the Performance Criteria. 11.5. Tax Withholding. The Company shall be entitled to require --------------- payment in cash or deduction from other compensation payable to each Holder of any sums required by federal, state or local tax law to be withheld with respect to the issuance, vesting, exercise or payment of any Award. The Administrator may in its discretion and in satisfaction of the foregoing requirement allow such Holder to elect to have the Company withhold shares of Common Stock otherwise issuable under such Award (or allow the return of shares of Common Stock) having a Fair Market Value equal to the sums required to be withheld. 11.6. Loans. The Committee may, in its discretion, extend one or ----- more loans to key Employees in connection with the exercise or receipt of an Award granted or awarded under the Plan, or the issuance of Restricted Stock or Deferred Stock awarded under the Plan. The terms and conditions of any such loan shall be set by the Committee. 11.7. Forfeiture Provisions. Pursuant to its general authority to --------------------- determine the terms and conditions applicable to Awards under the Plan, the Administrator shall have the right 25 to provide, in the terms of Awards made under the Plan, or to require a Holder to agree by separate written instrument, that (a) (i) any proceeds, gains or other economic benefit actually or constructively received by the Holder upon any receipt or exercise of the Award, or upon the receipt or resale of any Common Stock underlying the Award, must be paid to the Company, and (ii) the Award shall terminate and any unexercised portion of the Award (whether or not vested) shall be forfeited, if (b)(i) a Termination of Employment, Termination of Consultancy or Termination of Directorship occurs prior to a specified date, or within a specified time period following receipt or exercise of the Award, or (ii) the Holder at any time, or during a specified time period, engages in any activity in competition with the Company, or which is inimical, contrary or harmful to the interests of the Company, as further defined by the Administrator or (iii) the Holder incurs a Termination of Employment, Termination of Consultancy or Termination of Directorship for cause. 11.8. Effect of Plan Upon Options and Compensation Plans. The -------------------------------------------------- adoption of the Plan shall not affect any other compensation or incentive plans in effect for the Company or any Subsidiary. Nothing in the Plan shall be construed to limit the right of the Company (a) to establish any other forms of incentives or compensation for Employees, Directors or Consultants of the Company or any Subsidiary or (b) to grant or assume options or other rights or awards otherwise than under the Plan in connection with any proper corporate purpose including but not by way of limitation, the grant or assumption of options in connection with the acquisition by purchase, lease, merger, consolidation or otherwise, of the business, stock or assets of any corporation, partnership, limited liability company, firm or association. 11.9. Compliance with Laws. The Plan, the granting and vesting of -------------------- Awards under the Plan and the issuance and delivery of shares of Common Stock and the payment of money under the Plan or under Awards granted or awarded hereunder are subject to compliance with all applicable federal and state laws, rules and regulations (including but not limited to state and federal securities law and federal margin requirements) and to such approvals by any listing, regulatory or governmental authority as may, in the opinion of counsel for the Company, be necessary or advisable in connection therewith. Any securities delivered under the Plan shall be subject to such restrictions, and the person acquiring such securities shall, if requested by the Company, provide such assurances and representations to the Company as the Company may deem necessary or desirable to assure compliance with all applicable legal requirements. To the extent permitted by applicable law, the Plan and Awards granted or awarded hereunder shall be deemed amended to the extent necessary to conform to such laws, rules and regulations. 11.10. Titles. Titles are provided herein for convenience only and ------ are not to serve as a basis for interpretation or construction of the Plan. 11.11. Governing Law. The Plan and any agreements hereunder shall be ------------- administered, interpreted and enforced under the internal laws of the State of Delaware without regard to conflicts of laws thereof. 26 * * * I hereby certify that the foregoing Plan was duty adopted by the Board of Directors of COMPS InfoSystems, Inc, on October 28, 1998. Executed on this 28th day of October, 1998 /s/ ROBERT C. BEASLEY ------------------------------- Secretary 27 EX-10.31 36 FORM OF 1998 EQUITY PARTICIPATION PLAN Exhibit 10.31 1998 EQUITY PARTICIPATION PLAN FORM OF INCENTIVE STOCK OPTION AGREEMENT THIS AGREEMENT, dated __________, 199__ is made by and between COMPS InfoSystems, Inc., a Delaware corporation hereinafter referred to as "Company," and ___________, an employee of the Company or a Parent Corporation or Subsidiary of the Company, hereinafter referred to as "Employee" or "Optionee": WHEREAS, the Company wishes to afford the Employee the opportunity to purchase shares of its $.0l par value non-voting Class B Common Stock; and WHEREAS, the Company wishes to carry out the Plan (the terms of which are hereby incorporated by reference and made a part of this Agreement); and WHEREAS, the Administrator, appointed to administer the Plan, has determined that it would be to the advantage and best interest of the Company and its shareholders to grant the Incentive Stock Option provided for herein to the Employee as an inducement to perform future services for the Company, its Parent Corporations or its Subsidiaries and as an incentive for increased efforts during such service, and has advised the Company thereof and instructed the undersigned officers to issue said Option; NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows: ARTICLE I. DEFINITIONS Whenever the following terms are used in this Agreement, they shall have the meaning specified below unless the context clearly indicates to the contrary. The masculine pronoun shall include the feminine and neuter, and the singular the plural, where the context so indicates. 1.1. Administrator - ---- ------------- "Administrator, shall mean: (a) prior to the Initial Public Offering, the Board, or, in the sole and absolute discretion of the Board, the Committee; and (b) after the Initial Public Offering, the Committee. 1.2. Board - ---- ----- "Board" shall mean the Board of Directors of the Company. 1.3. Code - ---- ---- "Code" shall mean the Internal Revenue Code of 1986, as amended. 1.4. Committee - ---- --------- "Committee" shall mean the Stock Option Committee of the Board, appointed as provided in the Plan. 1.5. Common Stock - ---- ------------ "Common Stock" shall mean the Company's non-voting Class B Common Stock, par value $.0l per share. 1.6. Company - ---- ------- "Company" shall mean COMPS InfoSystems, Inc. 1.7. Director - ---- -------- "Director" shall mean a member of the Board. 1.8. Exchange Act - ---- ------------ "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. 1.9. Initial Public Offering - ---- ----------------------- "Initial Public Offering" shall mean the closing of the sale of the Company's securities pursuant to an underwritten public offering. 1.10. Officer - ----- ------- "Officer" shall mean an officer of the Company, as defined in Rule 16a- 1(f) under the Exchange Act, as such Rule may be amended in the future. 1.11. Option - ----- ------ "Option" shall mean the incentive stock option to purchase Common Stock of the Company granted under this Agreement. 1.12. Parent Corporation - ----- ------------------- "Parent Corporation" shall mean any corporation in an unbroken chain of corporations ending with the Company if each of the corporations other than the Company then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one (1) of the other corporations in such chain. 1.13. Plan - ----- ---- "Plan" shall mean the 1998 Equity Participation Plan of COMPS InfoSystems, Inc. 2 1.14. Rule 16b-3 - ----- ---------- "Rule 16b-3" shall mean that certain Rule 16b-3 under the Exchange Act, as such Rule may be amended in the future. 1.15 Secretary - ---- --------- Secretary" shall mean the Secretary of the Company. 1.16. Securities Act - ----- -------------- "Securities Act" shall mean the Securities Act of 1933, as amended. 1.17. Subsidiary - ----- ---------- "Subsidiary" shall mean any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one (1) of the other corporations in such chain. 1.18. Termination of Employment - ----- ------------------------- "Termination of Employment" shall mean the time when the employee- employer relationship between the Optionee and the Company, a Parent Corporation or a Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, a termination by resignation, discharge, death or retirement, but excluding any termination where there is a simultaneous reemployment by the Company, a Parent Corporation or a Subsidiary. The Administrator, in its absolute discretion, shall determine the effect of all other matters and questions relating to Termination of Employment, including, but not by way of limitation, the question of whether a Termination of Employment resulted from a discharge for good cause, and all questions of whether particular leaves of absence constitute Terminations of Employment; provided, however, that a leave of absence shall constitute a Termination of Employment if, and to the extent that, such leave of absence interrupts employment for purposes of Section 422(a)(2) of the Code and the then applicable regulations and revenue rulings under said Section. ARTICLE II GRANT OF OPTION 2.1. Grant of Option - ---- --------------- In consideration of the Employee's agreement to remain in the employ of the Company, its Parent Corporations or its Subsidiaries and for other good and valuable consideration, including the Company's desire to reward future services and contributions of the Employee, on the date hereof the Company irrevocably grants to the Employee the option to purchase any part or all of an aggregate of ________ shares of its $.01 par value non-voting Class B Common Stock upon the terms and conditions set forth in this Agreement. 3 2.2. Purchase Price - ---- -------------- The purchase price of the shares of stock covered by the Option shall be $.__ per share without commission or other charge. 2.3. Consideration to Company - ---- ------------------------ In consideration of the granting of this Option by the Company, the Employee agrees to render faithful and efficient services to the Company, a Parent Corporation or a Subsidiary, with such duties and responsibilities as the Company shall from time to time prescribe, for a period of at least one (1) year from the date this Option is granted. Nothing in this Agreement or in the Plan shall confer upon the Employee any right to continue in the employ of the Company, any Parent Corporation or any Subsidiary or shall interfere with or restrict in any way the rights of the Company, its Parent Corporations and its Subsidiaries, which are hereby expressly reserved, to discharge the Employee at any time for any reason whatsoever, with or without cause. 2.4. Adjustment in Option - ---- -------------------- In the event that the outstanding shares of the stock subject to the Option are changed into or exchanged for a different number or kind of shares of the Company or other securities of the Company by reason of merger, consolidation, recapitalization, reclassification, stock split up, stock dividend or combination of shares, the Administrator shall make an appropriate and equitable adjustment in the number and kind of shares as to which the Option, or portions thereof then unexercised, shall be exercisable, to the end that after such event the Employee's proportionate interest shall be maintained as before the occurrence of such event. Such adjustment in the Option shall be made without change in the total price applicable to the unexercised portion of the Option (except for any change in the aggregate price resulting from rounding-off of share quantities or prices) and with any necessary corresponding adjustment in the Option price per share; provided, however, that each such adjustment shall be made in such manner as not to constitute a "modification" within the meaning of Section 424(h)(3) of the Code. Any such adjustment made by the Administrator shall be final and binding upon the Employee, the Company and all other interested persons. ARTICLE III PERIOD OF EXERCISABILITY 3.1. Commencement of Exercisability - ---- ------------------------------ (a) Subject to Sections 3.5 and 5.6, the Option shall become exercisable in five (5) cumulative installments as follows: (i) The first installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the first anniversary of the date the Option is granted. 4 (ii) The second installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the second anniversary of the date the Option is granted. (iii) The third installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the third anniversary of the date the Option is granted. (iv) The fourth installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the fourth anniversary of the date the Option is granted. (v) The fifth installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the fifth anniversary of the date the Option is granted. (b) No portion of the Option which is unexercisable at Termination of Employment shall thereafter become exercisable. 3.2. Duration of Exercisability - ---- -------------------------- The installments provided for in Section 3.1 are cumulative. Each such installment which becomes exercisable pursuant to Section 3.1 shall remain exercisable until it becomes unexercisable under Section 3.3. 3.3. Expiration of Option - ---- -------------------- The Option may not be exercised to any extent by anyone after the first to occur of the following events: (a) The expiration of ten (10) years from the date the Option was granted; or (b) If the Employee owned (within the meaning of Section 424(d) of the Code), at the time the Option was granted, more than ten percent (10%) of the total combined voting power of all classes of stock of the Company, any Subsidiary or any Parent Corporation, the expiration of five (5) years from the date the Option was granted; or (c) The time of the Employee's Termination of Employment unless such Termination of Employment results from his death, his retirement, his disability (within the meaning of Section 22(e)(3) of the Code) or his being discharged not for good cause; or (d) The expiration of three (3) months from the date of the Employee's Termination of Employment by reason of his retirement or his being discharged not for good cause, unless the Employee dies within said three-month period; or 5 (e) The expiration of one (1) year from the date of the Employee's Termination of Employment by reason of his disability (within the meaning of Section 22(e)(3) of the Code); or (f) The expiration of one (1) year from the date of the Employee's death; or (g) The effective date of either the merger or consolidation of the Company with or into another corporation, or the acquisition by another corporation or person of all or substantially all of the Company's assets or eighty percent (80%) or more of the Company's then outstanding voting stock, or the liquidation or dissolution of the Company, unless the. Administrator waives this provision in connection with such transaction. At least ten (10) days. prior to the effective date of such merger, consolidation, acquisition, liquidation or dissolution, the Administrator shall give the Employee notice of such event if the Option has then neither been fully exercised nor become unexercisable under this Section 3.3. 3.4. Acceleration of Exercisability - ---- ------------------------------ In the event of the merger or consolidation of the Company with or into another corporation, or the acquisition by another corporation or person of all or substantially all of the Company's assets or eighty percent (80%) or more of the Company's then outstanding voting stock, or the liquidation or dissolution of the Company, the Administrator may, in its absolute discretion and upon such terms and conditions as it deems appropriate, provide by resolution, adopted prior to such event and incorporated in the notice referred to in Section 3.3(g), that at some time prior to the effective date of such event this Option shall be exercisable as to all the shares covered hereby, notwithstanding that this Option may not yet have become fully exercisable under Section 3.1(a); provided, however, that this acceleration of exercisability shall not take place if: (a) This Option becomes unexercisable under Section 3.3 prior to said effective date; or (b) In connection with such an event, provision is made for an assumption of this Option or a substitution therefor of a new option by an employer corporation, or a parent or subsidiary of such corporation, so that such assumption or substitution complies with the provisions of Section 424(a) of the Code; and provided, further, that nothing in this Section 3.4 shall make this Option exercisable if it is otherwise unexercisable by reason of Section 3.5 or Section 5.6. The Administrator may make such determinations and adopt such rules and conditions as it, in its absolute discretion, deems appropriate in connection with such acceleration of exercisability, including, but not by way of limitation, provisions to ensure that any such acceleration and resulting exercise shall be conditioned upon the consummation of the contemplated corporate transaction, and determinations regarding whether provisions for assumption or substitution have been made as defined in subsection (b) above. 6 3.5. Limitation on Exercisability - ---- ---------------------------- Notwithstanding any other provision of this Agreement, the aggregate fair market value (determined at the time the Option is granted) of the shares of the Company's stock with respect to which "incentive stock options" (within the meaning of Section 422 of the Code) are exercisable for the first time by the Employee during any calendar year (under the Plan and all other incentive stock option plans of the Company, any Subsidiary and any Parent Corporation) shall not exceed $100,000. ARTICLE IV EXERCISE OF OPTION 4.1. Person Eligible to Exercise - ---- --------------------------- During the lifetime of the Employee, only he may exercise the Option or any portion thereof. After the death of the Employee, any exercisable portion of the Option may, prior to the time when the Option becomes unexercisable under Section 3.3, be exercised by his personal representative or by any person empowered to do so under the Employee's will or under the then applicable laws of descent and distribution. 4.2. Partial Exercise - ---- ---------------- Any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time prior to the time when the Option or portion thereof becomes unexercisable under Section 3.3; provided, however, that each partial exercise shall be for not less than One Thousand (1000) shares (or the minimum installment set forth in Section 3. 1, if a smaller number of shares) and shall be for whole shares only. 4.3. Manner of Exercise - ---- ------------------ The Option, or any exercisable portion thereof, may be exercised solely by delivery to the Secretary or his office of all of the following prior to the time when the Option or such portion becomes unexercisable under Section 3.3: (a) Notice in writing signed by the Employee or the other person then entitled to exercise the Option or portion, stating that the Option or portion is thereby exercised, such notice complying with all applicable rules established by the Administrator; and (i) Full payment (by cashiers check or wire transfer) for the shares with respect to which such Option or portion is exercised; or (ii) With the consent of the Administrator, (A) shares of the Company's Common Stock owned by the Employee duly endorsed for transfer to the Company or (B) subject to the timing requirements of Section 4.4, shares of the Company's Common Stock issuable to the Employee upon exercise of the Option, with a fair market value (as determined under Section 1.18 of the Plan) on the date of Option 7 exercise equal to the aggregate purchase price of the shares with respect to which such Option or portion is exercised; or (iii) With the consent of the Administrator, a promissory note bearing interest (at no less than such rate as shall then preclude the imputation of interest under the Code or successor provision) and payable upon such terms as may be prescribed by the Administrator. The Administrator may also prescribe the form of such note and the security to be given for such note. That Option may not be exercised, however, by delivery of a promissory note or by a loan from the Company when or where such loan or other extension of credit is prohibited by law; or (iv) With the consent of the Administrator, any combination of the consideration provided in the foregoing subparagraphs (i) - (iii); and (b) A bona fide written representation and agreement, in a: form satisfactory to the Administrator, signed by the Employee or other person then entitled to exercise such Option or portion, stating that the shares of stock are being acquired for his own account, for investment and without any present intention of distributing or reselling said shares or any of them except as may be permitted under the Securities Act and then applicable rules and regulations thereunder, and that the Employee or other person then entitled to exercise such Option or portion will indemnify the Company against and hold it free and harmless from any loss, damage, expense or liability resulting to the Company if any sale or distribution of the shares by such person is contrary to the representation and agreement referred to above. The Administrator may, in its absolute discretion, take whatever additional actions it deems appropriate to insure the observance and performance of such representation and agreement and to effect compliance with the Securities Act and any other federal or state securities laws or regulations. Without limiting the generality of the foregoing, the Administrator may require an opinion of counsel acceptable to it to the effect that any subsequent transfer of shares acquired on an Option exercise does not violate the Securities Act, and may issue stop-transfer orders covering such shares. Share certificates evidencing stock issued on exercise of this Option shall bear an appropriate legend referring to the provisions of this subsection (c) and the agreements herein. The written representation and agreement referred to in the first sentence of this subsection (c) shall, however, not be required if the shares to be issued pursuant to such exercise have been registered under the Securities Act, and such registration is then effective in respect of such shares; (c) Full payment to the Company (or other employer corporation) of all amounts which, under federal, state or local tax law, it is required to withhold upon exercise of the Option; with the consent of the Administrator, (i) shares of the Company's Common Stock owned by the Employee duly endorsed for transfer or (ii) subject to the timing requirements of Section 4.4, shares of the Company's Common Stock issuable to the Employee upon exercise of the Option, valued in accordance with Section 1.18 of the Plan at the date of Option exercise, may be used to make all or part of such payment; and 8 (d) In the event the Option or portion shall be exercised pursuant to Section 4.1 by any person or persons other than the Employee, appropriate proof of the right of such person or persons to exercise the Option. 4.4. Certain Timing Requirements - ---- --------------------------- Shares of the Company's Common Stock issuable to the Employee upon exercise of the Option may be used to satisfy the Option price or the tax withholding consequences of such exercise only (i) during the period beginning on the third (3rd) business day following the date of release of the quarterly or annual summary statement of sales and earnings of the Company and ending on the twelfth (12th) business day following such date or (ii) pursuant to an irrevocable written election by the Employee to use shares of the Company's Common Stock issuable to the Employee upon exercise of the Option to pay all or part of the Option price or the withholding taxes (subject to the approval of the Administrator) made at least six (6) months prior to the payment of such Option price or withholding taxes. 4.5. Conditions to Issuance of Stock Certificates - ---- -------------------------------------------- The shares of stock deliverable upon the exercise of the Option, or any portion thereof, may be either previously authorized but unissued shares or issued shares which have then been reacquired by the Company. Such shares shall be fully paid and nonassessable. The Company shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of the Option or portion thereof prior to fulfillment of all of the following conditions: (a) The obtaining of any approval or other clearance from any state or federal governmental agency which the Administrator shall, in its absolute discretion, determine to be necessary or advisable; and (b) The payment to the Company (or other employer corporation) of all amounts which, under federal, state or local tax law, it is required to withhold upon exercise of the Option; and (c) The lapse of such reasonable period of time following the exercise of the Option as the Administrator may from time to time establish for reasons of administrative convenience. 4.6. Rights as Shareholder - ---- --------------------- The holder of the Option shall not be, nor have any of the rights or privileges of, a shareholder of the Company in respect of any shares purchasable upon the exercise of any part of the Option unless and until certificates representing such shares shall have been issued by the Company to such holder. 9 ARTICLE V OTHER PROVISIONS 5.1. Administration - ---- -------------- The Administrator shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such rules. All actions taken and all interpretations and determinations made by the Administrator in good faith shall be final and binding upon the Employee, the Company and all other interested persons. No member of the Administrator shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or the Option. In the event the Administrator is the Committee, the Board shall have no right to exercise any of the rights or duties of the Committee under the Plan and this Agreement. 5.2. Option Not Transferable - ---- ----------------------- Neither the Option nor any interest or right therein or part thereof shall be liable for the debts, contracts or engagements of the Employee or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect; provided, however, that this Section 5.2 shall not prevent transfers by will or by the applicable laws of descent and distribution. 5.3. Shares to Be Reserved - ---- --------------------- The Company shall at all times during the term of the Option reserve and keep available such number of shares of stock as will be sufficient to satisfy the requirements of this Agreement. 5.4. Notices - ---- ------- Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary, and any notice to be given to the Employee shall be addressed to him at the address given beneath his signature hereto. By a notice given pursuant to this Section 5.4, either party may hereafter designate a different address for notices to be given to him. Any notice which is required to be given to the Employee shall, if the Employee is then deceased, be given to the Employee's personal representative if such representative has previously informed the Company of his status and address by written notice under this Section 5.4. Any notice shall be deemed duly given when enclosed in a properly sealed envelope or wrapper addressed as aforesaid, deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service. 10 5.5. Titles - ---- ------ Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement. 5.6. Shareholder Approval - ---- -------------------- The Plan will be submitted for approval by the Company's shareholders within twelve (12) months after the date the Plan was initially adopted by the Board. This Option may not be exercised to any extent by anyone prior to the time when the Plan is approved by the shareholders, and if such approval has not been obtained by the end of said twelve-month period, this Option shall thereupon be canceled and become null and void. The Company shall take such actions as may be necessary to satisfy the requirements of Rule 16b-3(b). 5.7. Notification of Disposition - ---- --------------------------- The Employee shall give prompt notice to the Company of any disposition or other transfer of any shares of stock acquired under this Agreement if such disposition or transfer is made (a) within two (2) years from the date of granting the Option with respect to such shares or (b) within one (1) year after the transfer of such shares to him. Such notice shall specify the date of such disposition or other transfer and the amount realized, in cash, other property, assumption of indebtedness or other consideration, by the Employee in such disposition or other transfer. 5.8. Construction - ---- ------------ This Agreement shall be administered, interpreted and enforced under the laws of the State of Delaware. 5.9. Conformity to Securities Laws - ---- ----------------------------- The Employee acknowledges that the Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, including without limitation Rule 16b-3. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Option is granted and may be exercised, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations. 5.10. Company's Right to Repurchase Shares - ----- ------------------------------------ Upon Termination of Employment, the Company shall have the option to repurchase all (but not less than all) of the shares of stock which have been purchased by the Employee pursuant to exercise of the Option and which the Employee then holds. The repurchase price payable by the Company if it exercises its repurchase option shall be the greater of the purchase price of the shares pursuant to Section 2.2 or the fair market value of the shares 11 of stock on the date of repurchase, determined in accordance with Section 1.18 of the Plan, except that if at the date of such repurchase, the Company's common stock is not publicly traded, the fair market value of the shares of stock shall be determined for purposes of this Section 5.10 on the basis of the following formula: eight (8) times the Company's pre-tax earnings for the Company's most recently audited fiscal year divided by the number of outstanding shares of the Company's common stock (including shares issuable upon the conversion of outstanding shares of preferred stock) on the date of repurchase. The Company's repurchase option shall be exercisable by giving written notice to the Employee within thirty (30) calendar days after the Termination of Employment provided, however, that in the event that the Optionee exercises the Option after the Optionee's Termination of Employment but prior to the expiration of the Option pursuant to the provisions of Section 3.3, the Company's repurchase option shall be exercisable by giving written notice within thirty (30) calendar days after the exercise of the Option by the Optionee. In the event that the Company exercises its option to repurchase shares of stock from the Optionee pursuant to this Section 5.10, Optionee's shares of stock shall automatically be canceled, and Optionee shall have no further right, claim or title to such shares, other than the right to receive the repurchase price provided for in this Section 5.10. Upon receipt of a general release and the stock certificates representing the shares, the Company shall forward payment for such shares. 5.11. Restrictions on Transfer of Shares - ----- ---------------------------------- (a) There can be no valid transfer (as hereinafter defined) of any shares of stock purchased on exercise of the Option, or any interest in such shares, by any holder of such shares or interests unless such transfer is solely for cash consideration and is made in compliance with the following provisions: (i) Before there can be a valid transfer of any shares or -any interest therein, the record holder of the shares to be transferred (the "Offered Shares") shall give written notice (by registered or certified mail) to the Company. Such notice shall specify the identity of the proposed transferee, the cash price offered for the Offered Shares by the proposed transferee and the other terms and conditions of the proposed transfer. The date such notice is mailed shall be hereinafter referred to as the "notice date" and the record holder of the Offered Shares shall be hereinafter referred to as the "Offeror." (ii) For a period of thirty (30) calendar days after the notice date, the Company shall have the option to purchase all (but not less than all) of the Offered Shares at the purchase price and on the terms set forth in subsection (a)(iii) of this Section 5.11. This option shall be exercisable by the Company by mailing (by registered or certified mail) written notice of exercise to the Offeror prior to the end of said thirty (30) days. (iii) The price at which the Company may purchase the Offered Shares pursuant to the exercise of such option shall be the lower of (a) the cash price offered for the Offered Shares by the proposed transferee (as set forth in the notice required under subsection (a)(i) of this Section 5.11) or (b) the greater of the purchase price of the shares 12 pursuant to Section 2.2 or the fair market value of the shares of stock on the notice date, determined in accordance with Section 1.18 of the Plan. The Company's notice of exercise of such option shall be accompanied by full payment for the Offered Shares and, upon such payment by the Company, the Company shall acquire full right, title and interest to all of the Offered Shares. (iv) If, and only if, the option given pursuant to subsection (a)(ii) of this Section 5.11 is not exercised, the transfer proposed in the notice given pursuant to subsection (a)(i) of this Section 5.11 may take place; provided, however, that such transfer must, in all respects, be exactly as proposed in said notice except that such transfer may not take place either before the tenth (10th) calendar day after the expiration of said thirty-day option exercise period or after the ninetieth (90th) calendar day after the expiration of said thirty-day option to exercise period, and if such transfer has not taken place prior to said ninetieth (90th) day, such transfer may not take place without once again complying with subsection (a) of this Section 5.11. (b) As used in this Section 5.11, the term "transfer" means any sale, encumbrance, pledge, gift or other form of disposition or transfer of shares of the Company's stock or any legal or equitable interest therein; provided, however, that the term "transfer" does not include a transfer of such shares or interests by will or by the applicable laws of descent and distribution or a gift of such shares if the transferee or donee agrees to be bound by the provisions of this Section 5.11. (c) None of the shares of the Company's stock purchased on exercise of the Option shall be transferred on the Company's books nor shall the Company recognize any such transfer of any such shares or any interest therein unless and until all applicable provisions of this Section 5.11 have been complied with in all respects. The certificates of stock evidencing shares of stock purchased on exercise of the Option shall bear an appropriate legend referring to the transfer restrictions imposed by this Section 5.11 and to the repurchase option provided for in Section 5.10. 5.12. Company's Right to Non-Disclosure of Financial Information - ----- ---------------------------------------------------------- The Company shall have the right not to disclose the Company's financial information as long as the Company's common stock is not publicly traded. Whether an optionee or shareholder, the Employee agrees that Employee's access to the Company's financial information and financial records will be strictly prohibited as long as the Company's common stock is not publicly traded. Access to such financial information may only be granted by the Company's President or Chairman, in his or her sole discretion. 5.13. Lock-up in Event of Initial Public Offering - ----- ------------------------------------------- The Optionee agrees that, during a period of 180 days from the date of the Initial Public Offering, Optionee will not, without the prior written consent of the underwriter(s) of the Initial Public Offering, directly or indirectly, sell, offer to sell, grant any option for the sale of, or 13 otherwise dispose of or transfer, any shares of Common Stock issuable upon exercise of the Option. 5.14. Dispute Resolution - ----- ------------------ Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be resolved by binding arbitration before a single neutral arbitrator. The arbitrator shall be selected from the American Arbitration Association through its procedures. All rules governing the arbitration shall be the rules as set forth by the American Arbitration Association. The arbitrator is bound to rule only on whether or not there has been a violation of the terms of this Agreement and to render an award, if any, that is consistent with the terms of this Agreement. Neither party to this Agreement is entitled to any legal recourse or rights or remedies other than those provided within this Agreement. The arbitrator may apportion the costs of the arbitration, including arbitrator's fees, among the parties, but shall have no power to award attorneys' fees. Each party shall be responsible for its own attorneys' fees. IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties hereto. By: ______________________________ President By: ______________________________ Secretary _________________________ Employee _________________________ _________________________ Address _________________________ Employee's Taxpayer Identification Number: _________________________ 14 EX-10.32 37 FORM OF 1998 EQUITY PARTICIPATION PLAN EXHIBIT 10.32 1998 EQUITY PARTICIPATION PLAN FORM OF NON-QUALIFIED STOCK OPTION AGREEMENT THIS AGREEMENT, dated ___________, 199_ is made by and between COMPS InfoSystems, Inc., a Delaware corporation hereinafter referred to as "Company," and _____________, hereinafter referred to as "Optionee": WHEREAS, the Company wishes to afford the Optionee the opportunity to purchase shares of its $.0l par value non-voting Class B Common Stock; and WHEREAS, the Company wishes to carry out the Plan (the terms of which are hereby incorporated by reference and made a part of this Agreement); and WHEREAS, the Administrator appointed to administer the Plan, has determined that it would be to the advantage and best interest of the Company and its shareholders to grant the Non-Qualified Option provided for herein to the Optionee as an inducement to enter into or remain in a business relationship with the Company, its Parent Corporations or its Subsidiaries and as an incentive for increased efforts during such service, and has advised the Company thereof and instructed the undersigned officers to issue said Option; NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows: ARTICLE I DEFINITIONS Whenever the following terms are used in this Agreement, they shall have the meaning specified below unless the context clearly indicates to the contrary. The masculine pronoun shall include the feminine and neuter, and the singular the plural, where the context so indicates. 1.1. Administrator - ---- ------------- "Administrator" shall mean: (a) prior to the Initial Public Offering, the Board, or, in the sole and absolute discretion of the Board, the Committee; and (b) after the Initial Public Offering, the Committee. 1.2. Board - ---- ----- "Board" shall mean the Board of Directors of the Company. 1.3. Code - ---- ---- "Code" shall mean the Internal Revenue Code of 1986, as amended. 1.4. Committee - ---- --------- "Committee" shall mean the Stock Option Committee of the Board, appointed as provided in the Plan. 1.5. Common Stock - ---- ------------ "Common Stock" shall mean the Company's non-voting Class B Common Stock, par value $.0l per share. 1.6. Company - ---- ------- "Company" shall mean COMPS InfoSystems, Inc. 1.7. Director - ---- -------- "Director" shall mean a member of the Board. 1.8. Exchange Act - ---- ------------ "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. 1.9. Initial Public Offering - ---- ----------------------- "Initial Public Offering" shall mean the closing of the sale of the Company's securities pursuant to an underwritten public offering. 1.10. Officer - ----- ------- "Officer" shall mean an officer of the Company, as defined in Rule 16a-1(f) under the Exchange Act, as such Rule may be amended in the future. 1.11. Option - ----- ------ "Option" shall mean the non-qualified option to purchase Common Stock of the Company granted under this Agreement. 1.12. Parent Corporation - ----- ------------------ "Parent Corporation" shall mean any corporation in an unbroken chain of corporations ending with the Company if each of the corporations other than the Company then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one (1) of the other corporations in such chain. 1.13. Plan - ----- ---- "Plan" shall mean the 1998 Equity Participation Plan of COMPS InfoSystems, Inc. 2 1.14. Rule 16b-3 - ----- ---------- "Rule 16b-3" shall mean that certain Rule 16b-3 under the Exchange Act, as such Rule may be amended in the future. 1.15. Secretary - ----- --------- "Secretary" shall mean the Secretary of the Company. 1.16. Securities Act - ----- -------------- "Securities Act" shall mean the Securities Act of 1933, as amended. 1.17. Subsidiary - ----- ---------- "Subsidiary" shall mean any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one (1) of the other corporations in such chain. 1.18. Termination of Business Relationship - ----- ------------------------------------ "Termination of Business Relationship" shall mean the time when the business relationship between the Optionee and the Company, a Parent Corporation or a Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, a termination by cessation of business, bankruptcy, contract termination, resignation, discharge or death. The Administrator, in its absolute discretion, shall determine the effect of all other matters and questions relating to Termination of Business Relationship, including, but not by way of limitation, the question of whether a Termination of Business Relationship resulted from a discharge for good cause. ARTICLE II. GRANT OF OPTION 2.1. Grant of Option - ---- --------------- In consideration of the Optionee's agreement to remain in the business relationship with the Company, its Parent Corporations or its Subsidiaries and for other good and valuable consideration, on the date hereof the Company irrevocably grants to the Optionee the option to purchase any part or all of an aggregate of __________ shares of its $.0l par value non-voting Class B Common Stock upon the terms and conditions set forth in this Agreement. 2.2. Purchase Price - ---- -------------- The purchase price of the shares of stock covered by the Option shall be $.__ per share without commission or other charge. 3 2.3. Consideration to Company - ---- ------------------------ In consideration of the granting of this Option by the Company, the Optionee agrees to remain in the business relationship with the Company, a Parent Corporation or a Subsidiary, with such duties and responsibilities as the Company shall from time to time prescribe, for a period of at least one (1) year from the date this Option is granted. Nothing in this Agreement or in the Plan shall confer upon the Optionee any right to continue in a business relationship with the Company, any Parent Corporation or any Subsidiary or shall interfere with of restrict in any way the rights of the Company, its Parent Corporations and its Subsidiaries, which are hereby expressly reserved, to terminate such business relationship at any time for any reason whatsoever, with or without cause. 2.4. Adjustments in Option - ---- --------------------- In the event that the outstanding shares of the stock subject to the Option are changed into or exchanged for a different number or kind of shares of the Company or other securities of the Company by reason of merger, consolidation, recapitalization, reclassification, stock split up, stock dividend or combination of shares, the Administrator shall make an appropriate and equitable adjustment in the number and kind of shares as to which the Option, or portions thereof then unexercised, shall be exercisable, to the end that after such event the Optionee's proportionate interest shall be maintained as before the occurrence of such event. Such adjustment in the Option shall be made without change in the total price applicable to the unexercised portion of the Option (except for any change in the aggregate price resulting from rounding-off of share quantities or prices) and with any necessary corresponding adjustment in the Option price per share. Any such adjustment made by the Administrator shall be final and binding upon the Optionee, the Company and all other interested persons. ARTICLE III. PERIOD OF EXERCISABILITY 3.1. Commencement of Exercisability - ---- ------------------------------ (a) Subject to Section 5.6, the Option shall become exercisable in five (5) cumulative installments as follows: (i) The first installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the first anniversary of the date the Option is granted. (ii) The second installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the second anniversary of the date the Option is granted. (iii) The third installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the third anniversary of the date the Option is granted. 4 (iv) The fourth installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the fourth anniversary of the date the Option is granted. (v) The fifth installment shall consist of twenty percent (20%) of the shares covered by the Option and shall become exercisable upon the fifth anniversary of the date the Option is granted. (b) No portion of the Option which is unexercisable at Termination of Business Relationship shall thereafter become exercisable. 3.2. Duration of Exercisability - ---- -------------------------- The installments provided for in Section 3.1 are cumulative. Each such installment which becomes exercisable pursuant to Section 3.1 shall remain exercisable until it becomes unexercisable under Section 3.3. 3.3. Expiration of Option - ---- -------------------- The Option may not be exercised to any extent by anyone after the first to occur of the following events: (a) The expiration of ten (10) years from the date the Option was granted; or (b) The time of the Optionee's Termination of Business Relationship unless such Termination of Business Relationship results from his death, his retirement, his disability or his being discharged not for good cause; or (c) The expiration of three (3) months from the date of the Optionee's Termination of Business Relationship by reason of his retirement or his being discharged not for good cause, unless the Optionee dies within said three-month period; or (d) The expiration of one (1) year from the date of the Optionee's Termination of Business Relationship by reason of his disability; or (e) The expiration of one (1) year from the date of the Optionee's death; or (f) The effective date of either the merger or consolidation of the Company with or into another corporation, or the acquisition by another corporation or person of all or substantially all of the Company's assets or eighty percent (80%) or more of the Company's then outstanding voting stock, or the liquidation or dissolution of the Company, unless the Administrator waives this provision in connection with such transaction. At least ten (10) days prior to the effective date of such merger, consolidation, acquisition, liquidation or dissolution, the Administrator shall give the Optionee notice of such event if the Option has then neither been fully exercised nor become unexercisable under this Section 3.3. 5 3.4. Acceleration of Exercisability - ---- ------------------------------ In the event of the merger or consolidation of the Company with or into another corporation, or the acquisition by another corporation or person of all or substantially all of the Company's assets or eighty percent (80%) or more of the Company's then outstanding voting stock, or the liquidation or dissolution of the Company, the Administrator may, in its absolute discretion and upon such terms and conditions as it deems appropriate, provide by resolution, adopted prior to such event and incorporated in the notice referred to in Section 3.3(f), that at some time prior to the effective date of such event this Option shall be exercisable as to all the shares covered hereby, notwithstanding that this Option may not yet have become fully exercisable under Section 3.1(a); provided, however, that this acceleration of exercisability shall not take place if: (a) This Option becomes unexercisable under Section 3.3 prior to said effective date; or (b) In connection with such an event, provision is made for an assumption of this Option or a substitution therefor of a new option by an employer corporation or a parent or subsidiary of such corporation; and provided, further, that nothing in this Section 3.4 shall make this Option exercisable if it is otherwise unexercisable by reason of Section 5.6. The Administrator may make such determinations and adopt such rules and conditions as it, in its absolute discretion, deems appropriate in connection with such acceleration of exercisability, including, but not by way of limitation, provisions to ensure that any such acceleration and resulting exercise shall be conditioned upon the consummation of the contemplated corporate transaction. ARTICLE IV. EXERCISE OF OPTION 4.1. Person Eligible to Exercise - ---- --------------------------- During the lifetime of the Optionee, only he may exercise the Option or any portion thereof. After the death of the Optionee, any exercisable portion of the Option may, prior to the time when the Option becomes unexercisable under Section 3.3, be exercised by his personal representative or by any person empowered to do so under the Optionee's will or under the then applicable laws of descent and distribution. 4.2. Partial Exercise - ---- ---------------- Any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time prior to the time when the Option or portion thereof becomes unexercisable under Section 3.3; provided, however, that each partial exercise shall be for not less than One Thousand (1000) shares (or the minimum installment set forth in Section 3.1, if a smaller number of shares) and shall be for whole shares only. 6 4.3. Manner of Exercise - ---- ------------------ The Option, or any exercisable portion thereof, may be exercised solely by delivery to the Secretary or his office of all of the following prior to the time when the Option or such portion becomes unexercisable under Section 3.3: (a) Notice in writing signed by the Optionee or the other person then entitled to exercise the Option or portion, stating that the Option or portion is thereby exercised, such notice complying with all applicable rules established by the Committee; and (i) Full payment (by cashiers check or wire transfer) for the shares with respect to which such Option or portion is exercised; or (ii) With the consent of the Administrator, (A) shares of the Company's Common Stock owned by the Optionee duly endorsed for transfer to the Company or (B) subject to the timing requirements of Section 4.4, shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option, with a fair market value (as determined under Section 1.18 of the Plan) on the date of Option exercise equal to the aggregate purchase price of the shares with respect to which such Option or portion is exercised; or (iii) With the consent of the Administrator, a promissory note bearing interest (at no less than such rate as shall then preclude the imputation of interest under the Code or successor provision) and payable upon such terms as may be prescribed by the Administrator. The Administrator may also prescribe the form of such note and the security to be given for such note. That Option may not be exercised, however, by delivery of a promissory note or by a loan from the Company when or where such loan or other extension of credit is prohibited by law; or (iv) With the consent of the Administrator, any combination of the consideration provided in the foregoing subparagraphs (i) - (iii); and (b) A bona fide written representation and agreement, in a form satisfactory to the Administrator, signed by the Optionee or other person then entitled to exercise such Option or portion, stating that the shares of stock are being acquired for his own account, for investment and without any present intention of distributing or reselling said shares or any of them except as may be permitted under the Securities Act and then applicable rules and regulations thereunder, and that the Optionee or other person then entitled to exercise such Option or portion will indemnify the Company against and hold it free and harmless from any loss, damage, expense or liability resulting to the Company if any sale or distribution of the shares by such person is contrary to the representation and agreement referred to above. The Administrator may, in its absolute discretion, take whatever additional actions it deems appropriate to insure the observance and performance of such representation and agreement and to effect compliance with the Securities Act and any other federal or state securities laws or regulations. Without limiting the generality of the foregoing, the Administrator may require an opinion of counsel acceptable to it to the effect that any subsequent transfer of shares acquired on an Option exercise does not violate the Securities Act, and may issue stop-transfer orders covering such shares. Share 7 certificates evidencing stock issued on exercise of this Option shall bear an appropriate legend referring to the provisions of this subsection (c) and the agreements herein. The written representation and agreement referred to in the first sentence of this subsection (c) shall, however, not be required if the shares to be issued pursuant to such exercise have been registered under the Securities Act, and such registration is then effective in respect of such shares; and (c) Full payment to the Company (or other employer corporation) of all amounts which, under federal, state or local tax law, it is required to withhold upon exercise of the Option; with the consent of the Administrator, (i) shares of the Company's Common Stock owned by the Optionee duly endorsed for transfer, or (ii) subject to the timing requirements of Section 4.4, shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option, valued in accordance with Section 1.18 of the Plan at the date of Option exercise, may be used to make all or part of such payment; and (d) In the event the Option or portion shall be exercised pursuant to Section 4.1 by any person or persons other than the Optionee, appropriate proof of the right of such person or persons to exercise the Option. 4.4. Certain Timing Requirements - ---- --------------------------- Shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option may be used to satisfy the Option price or the tax withholding consequences of such exercise only (i) during the period beginning on the third (3rd) business day following the date of release of the quarterly or annual summary statement of sales and earnings of the Company and ending on the twelfth (12th) business day following such date or (ii) pursuant to an irrevocable written election by the Optionee to use shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option to pay all or part of the Option price or the withholding taxes (subject to the approval of the Administrator) made at least six (6) months prior to the payment of such Option price or withholding taxes. 4.5. Conditions to Issuance of Stock Certificates - ---- -------------------------------------------- The shares of stock deliverable upon the exercise of the Option, or any portion thereof, may be either previously authorized but unissued shares or issued shares which have then been reacquired by the Company. Such shares shall be fully paid and nonassessable. The Company shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of the Option or portion thereof prior to fulfillment of all of the following conditions: (a) The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; and (b) The completion of any registration or other qualification of such shares under any state or federal law or under rulings or regulations of the Securities and Exchange Commission or of any other governmental regulatory body, which the Administrator shall, in its absolute discretion, deem necessary or advisable; and 8 (c) The obtaining of any approval or other clearance from any state or federal governmental agency which the Administrator shall, in its absolute discretion, determine to be necessary or advisable; and (d) The payment to the Company (or other employer corporation) of all amounts which, under federal, state or local tax law, it is required to withhold upon exercise of the Option; and (e) The lapse of such reasonable period of time following the exercise of the Option as the Administrator may from time to time establish for reasons of administrative convenience. 4.6. Rights as Shareholder - ---- --------------------- The holder of the Option shall not be, nor have any of the rights or privileges of, a shareholder of the Company in respect of any shares purchasable upon the exercise of any part of the Option unless and until certificates representing such shares shall have been issued by the Company to such holder. ARTICLE V. OTHER PROVISIONS 5.1. Administration - ---- -------------- The Administrator shall have the power to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret or revoke any such rules. All actions taken and all interpretations and determinations made by the Administrator in good faith shall be final and binding upon the Optionee, the Company and all other interested persons. No member of the Administrator shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or the Option. In the event that the Administrator is the Committee, the Board shall have no right to exercise any of the rights or duties of the Committee under the Plan and this Agreement. 5.2. Option Not Transferable - ---- ----------------------- Neither the Option nor any interest or right therein or part thereof shall be liable for the debts, contracts or engagements of the Optionee or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect; provided, however, that this Section 5.2 shall not prevent transfers by will or by the applicable laws of descent and distribution. 9 5.3. Shares to Be Reserved - ---- --------------------- The Company shall at all times during the term of the Option reserve and keep available such number of shares of stock as will be sufficient to satisfy the requirements of this Agreement. 5.4. Notices - ---- ------- Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary, and any notice to be given to the Optionee shall be addressed to him at the address given beneath his signature hereto. By a notice given pursuant to this Section 5.4, either party may hereafter designate a different address for notices to be given to him. Any notice which is required to be given to the Optionee shall, if the Optionee is then deceased, be given to the Optionee's personal representative if such representative has previously informed the Company of his status and address by written notice under this Section 5.4. Any notice shall be deemed duly given when enclosed in a properly sealed envelope or wrapper addressed as aforesaid, deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service. 5.5. Titles - ---- ------ Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement. 5.6. Shareholder Approval - ---- -------------------- The Plan will be submitted for approval by the Company's shareholders within twelve (12) months after the date the Plan was initially adopted by the Board. This Option may not be exercised to any extent by anyone prior to the time when the Plan is approved by the shareholders, and if such approval has not been obtained by the end of said twelve-month period, this Option shall thereupon be canceled and become null and void. The Company shall take such actions as may be necessary to satisfy the requirements of Rule 16b-3(b). 5.7. Construction - ---- ------------ This Agreement shall be administered, interpreted and enforced under the laws of the State of Delaware. 5.8. Conformity to Securities Laws - ---- ----------------------------- The Optionee acknowledges that the Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, including without limitation Rule 16b-3. Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Option is granted and may be exercised, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, the Plan and this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations. 10 5.9. Company's Right to Repurchase Shares - ---- ------------------------------------ Upon Termination of Business Relationship, the Company shall have the option to repurchase all (but not less than all) of the shares of stock which have been purchased by the Optionee pursuant to exercise of the Option and which the Optionee then holds. The repurchase price payable by the Company if it exercises its repurchase option shall be the fair market value of the shares of stock on the date of repurchase, determined in accordance with Section 1.18 of the Plan, except that if at the date of such repurchase, the Company's common stock is not publicly traded, the fair market value of the shares of stock shall be determined for purposes of this Section 5.9 on the basis of the following formula: eight (8) times the Company's pre-tax earnings for the Company's most recently audited fiscal year divided by the number of outstanding shares of the Company's common stock (including shares issuable upon the conversion of outstanding shares of preferred stock) on the date of repurchase. The Company's repurchase option shall be exercisable by giving written notice to the Optionee within thirty (30) calendar days after the Termination of Business Relationship provided, however, that in the event that the Optionee exercises the Option after the Optionee's Termination of Business Relationship but prior to the expiration of the Option pursuant to the provisions of Section 3.3, the Company's repurchase option shall be exercisable by giving written notice within thirty (30) calendar days after the exercise of the Option by the Optionee. In the event that the Company exercises its option to repurchase shares of stock from the Optionee pursuant to this Section 5.9, the Optionee shall sign a general release acknowledging that the Optionee has no further right, claim or title to such shares. Upon receipt of such general release and the stock certificates representing the shares, the Company shall forward payment for such shares. 5.10. Restrictions on Transfer of Shares - ----- ---------------------------------- (a) There can be no valid transfer (as hereinafter defined) of any shares of stock purchased on exercise of the Option, or any interest in such shares, by any holder of such shares or interests unless such transfer is solely for cash consideration and is made in compliance with the following provisions: (i) Before there can be a valid transfer of any shares or any interest therein, the record holder of the shares to be transferred (the "Offered Shares') shall give written notice (by registered or certified mail) to the Company. Such notice shall specify the identity of the proposed transferee, the cash price offered for the Offered Shares by the proposed transferee and the other terms and conditions of the proposed transfer. The date such notice is mailed shall be hereinafter referred to as the "notice date" and the record holder of the Offered Shares shall be hereinafter referred to as the "Offeror." (ii) For a period of thirty (30) calendar days after the notice date, the Company shall have the option to purchase all (but not less than all) of the Offered Shares at the purchase price and on the terms set forth in subsection (a)(3) of this Section 5.10. This option shall be exercisable by the Company by mailing (by registered or certified mail) written notice of exercise to the Offeror prior to the end of said thirty (30) days. 11 (iii) The price at which the Company may purchase the Offered Shares pursuant to the exercise of such option shall be the lower of (a) the cash price offered for the Offered Shares by the proposed transferee (as set forth in the notice required under subsection (a)(i) of this Section 5.10) or (b) the greater of the purchase price of the shares pursuant to Section 2.2 or the fair market value of the shares of stock on the notice date, determined in accordance with Section 1.18 of the Plan. The Company's notice of exercise of such option shall be accompanied by full payment for the Offered Shares and, upon such payment by the Company, the Company shall acquire full right, title and interest to all of the Offered Shares. (iv) If, and only if, the option given pursuant to subsection (a)(ii) of this Section 5.10 is not exercised, the transfer proposed in the notice given pursuant to subsection (a)(i) of this Section 5.10 may take place; provided, however, that such transfer must, in all respects, be exactly as proposed in said notice except that such transfer may not take place either before the tenth (10th) calendar day after the expiration of said thirty-day option exercise period or after the ninetieth (90th) calendar day after the expiration of said thirty-day option exercise period, and if such transfer has not taken place prior to said ninetieth (90th) day, such transfer may not take place without once again complying with subsection (a) of this Section 5.10. (b) As used in this Section 5.10, the term "transfer" means any sale, encumbrance, pledge, gift or other form of disposition or transfer of shares of the Company's stock or any legal or equitable interest therein; provided, however, that the term "transfer" does not include a transfer of such shares or interests by will or by the applicable laws of descent and distribution or a gift of such shares if the transferee or donee agrees to be bound by the provisions of this Section 5.10. (c) None of the shares of the Company's stock purchased on exercise of the Option shall be transferred on the Company's books nor shall the Company recognize any such transfer of any such shares or any interest therein unless and until all applicable provisions of this Section 5.10 have been compiled with in all respects. The certificates of stock evidencing shares of stock purchased on exercise of the Option shall bear an appropriate legend referring to the transfer restrictions imposed by this Section 5.10 and to the repurchase option provided for in Section 5.9. 5.11. Lock-up in Event of Initial Public Offering - ----- ------------------------------------------- The Optionee agrees that, during a period of 180 days from the date of the Initial Public Offering, Optionee will not, without the prior written consent of the underwriter(s) of the Initial Public Offering, directly or indirectly, sell, offer to sell, grant any option for the sale of, or otherwise dispose of or transfer, any shares of Common Stock issuable upon exercise of the Option. 5.12. Dispute Resolution - ----- ------------------ Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be resolved 12 by binding arbitration before a single neutral arbitrator. The arbitrator shall be selected from the American Arbitration Association through its procedures. All rules governing the arbitration shall be the rules as set forth by the American Arbitration Association. The arbitrator is bound to rule only on whether or not there has been a violation of the terms of this Agreement and to render an award, if any, that is consistent with the terms of this Agreement. Neither party to this Agreement is entitled to any legal recourse or rights or remedies other than those provided within this Agreement. The arbitrator may apportion the costs of the arbitration, including arbitrator's fees, among the parties, but shall have no power to award attorneys' fees. Each party shall be responsible for its own attorneys' fees. IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties hereto. By: -------------------------------- President By: -------------------------------- Secretary - -------------------------------- Optionee - -------------------------------- - -------------------------------- Address Optionee's Taxpayer Identification Number: - -------------------------------- 13 EX-10.33 38 1998 SUPPLEMENTAL OPTION PLAN EXHIBIT 10.33 THE 1998 SUPPLEMENTAL OPTION PLAN OF COMPS INFOSYSTEMS, INC. COMPS InfoSystems, Inc., a Delaware corporation, has adopted The 1998 Supplemental Option Plan of COMPS InfoSystems, Inc. (the "Plan"), effective November 6, 1998, for the benefit of its eligible employees, consultants and directors. The purposes of the Plan are as follows: (1) To provide an additional incentive for directors, key Employees and Consultants (as such terms are defined below) to further the growth, development and financial success of the Company by personally benefiting through the ownership of Company stock and/or rights which recognize such growth, development and financial success. (2) To enable the Company to obtain and retain the services of directors, key Employees and Consultants considered essential to the long range success of the Company by offering them an opportunity to own stock in the Company and/or rights which will reflect the growth, development and financial success of the Company. ARTICLE I. DEFINITIONS 1.1. General. Wherever the following terms are used in the Plan they ------- shall have the meanings specified below, unless the context clearly indicates otherwise. 1.2. Administrator. "Administrator" shall mean the entity that ------------- conducts the general administration of the Plan as provided herein. The term "Administrator" shall refer to the Committee unless the Board has assumed the authority for administration of the Plan generally as provided in Section 10.1. 1.3. Award. "Award" shall mean an Option, a Restricted Stock award, ----- a Performance Award, a Dividend Equivalents award, a Deferred Stock award, a Stock Payment award or a Stock Appreciation Right which may be awarded or granted under the Plan (collectively, "Awards"). 1.4. Award Agreement. "Award Agreement" shall mean a written --------------- agreement executed by an authorized officer of the Company and the Holder which shall contain such terms and conditions with respect to an Award as the Administrator shall determine, consistent with the Plan. 1.5. Award Limit. "Award Limit" shall mean 423,537 shares of Common ----------- Stock, as adjusted pursuant to Section 11.3 of the Plan. 1.6. Board. "Board" shall mean the Board of Directors of the ----- Company. 1.7. Code. "Code" shall mean the Internal Revenue Code of 1986, as ---- amended. 1.8. Committee. "Committee" shall mean the Compensation Committee --------- of the Board, or another committee or subcommittee of the Board, appointed as provided in Section 10.1. 1.9. Common Stock. "Common Stock" shall mean the non-voting Class B ------------ common stock of the Company, par value $.01 per share, and any equity security of the Company issued or authorized to be issued in the future, but excluding any preferred stock and any warrants, options or other rights to purchase Common Stock. 1.10. Company. "Company" shall mean COMPS InfoSystems, Inc., a ------- Delaware corporation. 1.11. Consultant. "Consultant" shall mean any consultant or adviser ---------- if: (a) the consultant or adviser renders bona fide services to the Company; (b) the services rendered by the consultant or adviser are not in connection with the offer or sale of securities in a capital-raising transaction and do not directly or indirectly promote or maintain a market for the Company's securities; and (c) the consultant or adviser is a natural person who has contracted directly with the Company to render such services. 1.12. Deferred Stock. "Deferred Stock" shall mean Common Stock -------------- awarded under Article VIII of the Plan. 1.13. Director. "Director" shall mean a member of the Board. -------- 1.14. Dividend Equivalent. "Dividend Equivalent" shall mean a right ------------------- to receive the equivalent value (in cash or Common Stock) of dividends paid on Common Stock, awarded under Article VIII of the Plan. 1.15. DRO. "DRO" shall mean a domestic relations order as defined by --- the Code or Title I of the Employee Retirement Income Security Act of 1974, as amended, or the rules thereunder. 1.16. Employee. "Employee" shall mean any officer or other employee -------- (as defined in accordance with Section 3401(c) of the Code) of the Company, or of any corporation which is a Subsidiary. 2 1.17. Exchange Act. "Exchange Act" shall mean the Securities ------------ Exchange Act of 1934, as amended. 1.18. Fair Market Value. "Fair Market Value" of a share of Common ----------------- Stock as of a given date shall be (a) the closing price of a share of Common Stock on the principal exchange on which shares of Common Stock are then trading, if any (or as reported on any composite index which includes such principal exchange), on the trading day previous to such date, or if shares were not traded on the trading day previous to such date, then on the next preceding date on which a trade occurred, or (b) if Common Stock is not traded on an exchange but is quoted on NASDAQ or a successor quotation system, the mean between the closing representative bid and asked prices for the Common Stock on the trading day previous to such date as reported by NASDAQ or such successor quotation system; or (c) if Common Stock is not publicly traded on an exchange and not quoted on NASDAQ or a successor quotation system, the Fair Market Value of a share of Common Stock as established by the Administrator acting in good faith. 1.19. Holder. "Holder" shall mean a person who has been granted or ------ awarded an Award. 1.20. Incentive Stock Option. "Incentive Stock Option" shall mean an ---------------------- option which conforms to the applicable provisions of Section 422 of the Code and which is designated as an Incentive Stock Option by the Administrator. 1.21. Independent Director. "Independent Director" shall mean a -------------------- member of the Board who is not an Employee of the Company. 1.22. Non-Qualified Stock Option. "Non-Qualified Stock Option" shall -------------------------- mean an Option which is not designated as an Incentive Stock Option by the Administrator. 1.23. Option. "Option" shall mean a stock option granted under ------ Article IV of the Plan. An Option granted under the Plan shall, as determined by the Administrator, be either a Non-Qualified Stock Option or an Incentive Stock Option; provided, however, that Options granted to Consultants shall be -------- ------- Non-Qualified Stock Options. 1.24. Performance Award. "Performance Award" shall mean a cash ----------------- bonus, stock bonus or other performance or incentive award that is paid in cash, Common Stock or a combination of both, awarded under Article VIII of the Plan. 1.25. Performance Criteria. "Performance Criteria" shall mean the -------------------- following business criteria with respect to the Company, any Subsidiary or any division or operating unit: (a) net income, (b) pre-tax income, (c) operating income, (d) cash flow, (e) earnings per share, (f) return on equity, (g) return on invested capital or assets, (h) cost reductions or savings, (i) funds from operations, (j) appreciation in the fair market value of Common Stock and (k) earnings before any one or more of the following items: interest, taxes, depreciation or amortization. 1.26. Plan. "Plan" shall mean The 1998 Supplemental Option Plan of ---- COMPS InfoSystems, Inc. 3 1.27. Restricted Stock. "Restricted Stock" shall mean Common Stock ---------------- awarded under Article VII of the Plan. 1.28. Rule 16b-3. "Rule 16b-3" shall mean that certain Rule 16b-3 ---------- under the Exchange Act, as such Rule may be amended from time to time. 1.29. Section 162(m) Participant. "Section 162(m) Participant" shall -------------------------- mean any key Employee designated by the Administrator as a key Employee whose compensation for the fiscal year in which the key Employee is so designated or a future fiscal year may be subject to the limit on deductible compensation imposed by Section 162(m) of the Code. 1.30. Securities Act. "Securities Act" shall mean the Securities Act -------------- of 1933, as amended. 1.31. Stock Appreciation Right. "Stock Appreciation Right" shall ------------------------ mean a stock appreciation right granted under Article IX of the Plan. 1.32. Stock Payment. "Stock Payment" shall mean (a) a payment in the ------------- form of shares of Common Stock, or (b) an option or other right to purchase shares of Common Stock, as part of a deferred compensation arrangement, made in lieu of all or any portion of the compensation, including without limitation, salary, bonuses and commissions, that would otherwise become payable to a key Employee or Consultant in cash, awarded under Article VIII of the Plan. 1.33. Subsidiary. "Subsidiary" shall mean any corporation in an ---------- unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 1.34. Substitute Award. "Substitute Award" shall mean an Option ---------------- granted under this Plan upon the assumption of, or in substitution for, outstanding equity awards previously granted by a company or other entity in connection with a corporate transaction, such as a merger, combination, consolidation or acquisition of property or stock; provided, however, that in no -------- ------- event shall the term "Substitute Award" be construed to refer to an award made in connection with the cancellation and repricing of an Option. 1.35. Termination of Consultancy. "Termination of Consultancy" shall -------------------------- mean the time when the engagement of a Holder as a Consultant to the Company or a Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, by resignation, discharge, death or retirement; but excluding terminations where there is a simultaneous commencement of employment with the Company or any Subsidiary. The Administrator, in its absolute discretion, shall determine the effect of all matters and questions relating to Termination of Consultancy, including but not by way of limitation, the question of whether a Termination of Consultancy resulted from a discharge for good cause, and all questions of whether a particular leave of absence constitutes a Termination of Consultancy. Notwithstanding any other provision of the Plan, the Company or any Subsidiary has an absolute and unrestricted right to terminate a Consultant's service at any time for any reason whatsoever, with or without cause, except to the extent expressly provided otherwise in writing. 4 1.36. Termination of Employment. "Termination of Employment" shall ------------------------- mean the time when the employee-employer relationship between a Holder and the Company or any Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, a termination by resignation, discharge, death, disability or retirement; but excluding (a) terminations where there is a simultaneous reemployment or continuing employment of a Holder by the Company or any Subsidiary, (b) at the discretion of the Administrator, terminations which result in a temporary severance of the employee-employer relationship, and (c) at the discretion of the Administrator, terminations which are followed by the simultaneous establishment of a consulting relationship by the Company or a Subsidiary with the former employee. The Administrator, in its absolute discretion, shall determine the effect of all matters and questions relating to Termination of Employment, including, but not by way of limitation, the question of whether a Termination of Employment resulted from a discharge for good cause, and all questions of whether a particular leave of absence constitutes a Termination of Employment; provided, however, that, with respect -------- ------- to Incentive Stock Options, unless otherwise determined by the Administrator in its discretion, a leave of absence, change in status from an employee to an independent contractor or other change in the employee-employer relationship shall constitute a Termination of Employment if, and to the extent that, such leave of absence, change in status or other change interrupts employment for the purposes of Section 422(a)(2) of the Code and the then applicable regulations and revenue rulings under said Section. ARTICLE II. SHARES SUBJECT TO PLAN 2.1. Shares Subject to Plan. ---------------------- (a) The shares of stock subject to Awards shall be Common Stock, initially shares of the Company's Common Stock, par value $.01 per share. The aggregate number of such shares which may be issued upon exercise of such Options or rights or upon any such awards under the Plan shall not exceed 847,174. The shares of Common Stock issuable upon exercise of such Options or rights or upon any such awards may be either previously authorized but unissued shares or treasury shares. (b) The maximum number of shares which may be subject to Awards, granted under the Plan to any individual in any fiscal year shall not exceed the Award Limit. To the extent required by Section 162(m) of the Code, shares subject to Options which are canceled continue to be counted against the Award Limit. 2.2. Add-back of Options and Other Rights. If any Option, or other ------------------------------------ right to acquire shares of Common Stock under any other Award under the Plan, expires or is canceled without having been fully exercised, or is exercised in whole or in part for cash as permitted by the Plan, the number of shares subject to such Option or other right but as to which such Option or other right was not exercised prior to its expiration, cancellation or exercise may again be optioned, granted or awarded hereunder, subject to the limitations of Section 2.1. Furthermore, any shares subject to Awards which are adjusted pursuant to Section 11.3 and become exercisable with respect to shares of stock of another corporation shall be considered canceled and may again be optioned, granted or awarded hereunder, subject to the limitations of 5 Section 2.1. Shares of Common Stock which are delivered by the Holder or withheld by the Company upon the exercise of any Award under the Plan, in payment of the exercise price thereof or tax withholding thereon, may again be optioned, granted or awarded hereunder, subject to the limitations of Section 2.1. If any shares of Restricted Stock are surrendered by the Holder or repurchased by the Company pursuant to Section 7.4 or 7.5 hereof, such shares may again be optioned, granted or awarded hereunder, subject to the limitations of Section 2.1. Notwithstanding the provisions of this Section 2.2, no shares of Common Stock may again be optioned, granted or awarded if such action would cause an Incentive Stock Option to fail to qualify as an incentive stock option under Section 422 of the Code. ARTICLE III. GRANTING OF AWARDS 3.1. Award Agreement. Each Award shall be evidenced by an Award --------------- Agreement. Award Agreements evidencing Awards intended to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code shall contain such terms and conditions as may be necessary to meet the applicable provisions of Section 162(m) of the Code. Award Agreements evidencing Incentive Stock Options shall contain such terms and conditions as may be necessary to meet the applicable provisions of Section 422 of the Code. 3.2. Provisions Applicable to Section 162(m) Participants. ---------------------------------------------------- (a) The Committee, in its discretion, may determine whether an Award is to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code. (b) Notwithstanding anything in the Plan to the contrary, the Committee may grant any Award to a Section 162(m) Participant, including Restricted Stock, the restrictions with respect to which lapse upon the attainment of performance goals which are related to one or more of the Performance Criteria and any performance or incentive award described in Article VIII that vests or becomes exercisable or payable upon the attainment of performance goals which are related to one or more of the Performance Criteria. (c) To the extent necessary to comply with the performance-based compensation requirements of Section 162(m)(4)(C) of the Code, with respect to any Award granted under Articles VII and VIII which may be granted to one or more Section 162(m) Participants, no later than ninety (90) days following the commencement of any fiscal year in question or any other designated fiscal period or period of service (or such other time as may be required or permitted by Section 162(m) of the Code), the Committee shall, in writing, (i) designate one or more Section 162(m) Participants, (ii) select the Performance Criteria applicable to the fiscal year or other designated fiscal period or period of service, (iii) establish the various performance targets, in terms of an objective formula or standard, and amounts of such Awards, as applicable, which may be earned for such fiscal year or other designated fiscal period or period of service and (iv) specify the relationship between Performance Criteria and the performance targets and the amounts of such Awards, as applicable, to be earned by each Section 162(m) Participant for such fiscal year or other designated fiscal period or period of service. Following the completion of each fiscal year or other designated fiscal period or period of 6 service, the Committee shall certify in writing whether the applicable performance targets have been achieved for such fiscal year or other designated fiscal period or period of service. In determining the amount earned by a Section 162(m) Participant, the Committee shall have the right to reduce (but not to increase) the amount payable at a given level of performance to take into account additional factors that the Committee may deem relevant to the assessment of individual or corporate performance for the fiscal year or other designated fiscal period or period of service. (d) Furthermore, notwithstanding any other provision of the Plan or any Award which is granted to a Section 162(m) Participant and is intended to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code shall be subject to any additional limitations set forth in Section 162(m) of the Code (including any amendment to Section 162(m) of the Code) or any regulations or rulings issued thereunder that are requirements for qualification as performance-based compensation as described in Section 162(m)(4)(C) of the Code, and the Plan shall be deemed amended to the extent necessary to conform to such requirements. 3.3. Limitations Applicable to Section 16 Persons. Notwithstanding -------------------------------------------- any other provision of the Plan, the Plan, and any Award granted or awarded to any individual who is then subject to Section 16 of the Exchange Act, shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by applicable law, the Plan and Awards granted or awarded hereunder shall be deemed amended to the extent necessary to conform to such applicable exemptive rule. 3.4. Consideration. In consideration of the granting of an Award ------------- under the Plan, the Holder shall agree, in the Award Agreement, to remain in the employ of (or to consult for, as applicable) the Company or any Subsidiary for a period of at least one year (or such shorter period as may be fixed in the Award Agreement or by action of the Administrator following grant of the Award) after the Award is granted. 3.5. At-Will Employment. Nothing in the Plan or in any Award ------------------ Agreement hereunder shall confer upon any Holder any right to continue in the employ of, or as a Consultant for, the Company or any Subsidiary, or as a director of the Company, or shall interfere with or restrict in any way the rights of the Company and any Subsidiary, which are hereby expressly reserved, to discharge any Holder at any time for any reason whatsoever, with or without cause, except to the extent expressly provided otherwise in a written employment agreement between the Holder and the Company and any Subsidiary. ARTICLE IV. GRANTING OF OPTIONS TO EMPLOYEES AND CONSULTANTS 4.1. Eligibility. Any Employee or Consultant selected by the ----------- Committee pursuant to Section 4.4(a)(i) shall be eligible to be granted an Option. 7 4.2. Disqualification for Stock Ownership. No person may be granted ------------------------------------ an Incentive Stock Option under the Plan if such person, at the time the Incentive Stock Option is granted, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any then existing Subsidiary or parent corporation (within the meaning of Section 422 of the Code) unless such Incentive Stock Option conforms to the applicable provisions of Section 422 of the Code. 4.3. Qualification of Incentive Stock Options. No Incentive Stock ---------------------------------------- Option shall be granted to any person who is not an Employee. 4.4. Granting of Options to Employees and Consultants. ------------------------------------------------ (a) The Committee shall from time to time, in its absolute discretion, and subject to applicable limitations of the Plan: (i) Determine which Employees are key Employees and select from among the key Employees or Consultants (including Employees or Consultants who have previously received Awards under the Plan) such of them as in its opinion should be granted Options; (ii) Subject to the Award Limit, determine the number of shares to be subject to such Options granted to the selected key Employees or Consultants; (iii) Subject to Section 4.3, determine whether such Options are to be Incentive Stock Options or Non-Qualified Stock Options and whether such Options are to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code; and (iv) Determine the terms and conditions of such Options, consistent with the Plan; provided, however, that the terms and conditions -------- ------- of Options intended to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code shall include, but not be limited to, such terms and conditions as may be necessary to meet the applicable provisions of Section 162(m) of the Code. (b) Upon the selection of a key Employee or Consultant to be granted an Option, the Committee shall instruct the Secretary of the Company to issue the Option and may impose such conditions on the grant of the Option as it deems appropriate. (c) Any Incentive Stock Option granted under the Plan may be modified by the Committee, with the consent of the Holder, to disqualify such Option from treatment as an "incentive stock option" under Section 422 of the Code. ARTICLE V. TERMS OF OPTIONS 5.1. Option Price. The price per share of the shares subject to ------------ each Option granted to Employees and Consultants shall be set by the Committee; provided, however, that - -------- ------- 8 such price shall be no less than 85% of the Fair Market Value of a share of Common Stock on the date the Option is granted and; (a) in the case of Incentive Stock Options, such price shall not be less than 100% of the Fair Market Value of a share of Common Stock on the date the Option is granted (or the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code); and (b) in the case of Options granted to an individual then owning (within the meanings of Section 424(d) of the Code) more than 10% of the total combined voting power of all classes of stock of the Company or any Subsidiary or parent corporation thereof (within the meaning of Section 422 of the Code), such price shall not be less than 110% of the Fair Market Value of a share of Common Stock on the date the Option is granted (or the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code). 5.2. Option Term. The term of an Option granted to an Employee or ----------- consultant shall be set by the Committee in its discretion; provided, however, -------- ------- that the term of any Option shall not be more than ten (10) years from the date the Option is granted or, in the case of any Incentive Stock Option, five (5) years from the date the Incentive Stock Option is granted if the Incentive Stock Option is granted to an individual then owning (within the meaning of Section 424(d) of the Code) more than 10% of the total combined voting power of all classes of stock of the Company or any Subsidiary or parent corporation thereof (within the meaning of Section 422 of the Code). Except as limited by applicable state law or the requirements of Section 422 of the Code and regulations and rulings thereunder applicable to Incentive Stock Options, the Committee may extend the term of any outstanding Option in connection with any Termination of Employment or Termination of Consultancy of the Holder, or amend any other term or condition of such Option relating to such a termination. 5.3. Option Vesting -------------- (a) The period during which the right to exercise, in whole or in part, an Option granted to an Employee or a Consultant vests in the Holder shall be set by the Committee and the Committee may determine that an Option may not be exercised in whole or in part for a specified period after it is granted; provided, however, that, unless the Committee otherwise provides in the terms of - -------- ------- the Award Agreement or otherwise, no Option shall be exercisable by any Holder who is then subject to Section 16 of the Exchange Act within the period ending six months and one day after the date the Option is granted. At any time after grant of an Option, the Committee may, in its sole and absolute discretion and subject to whatever terms and conditions it selects, accelerate the period during which an Option granted to an Employee or Consultant vests. (b) No portion of an Option granted to an Employee or Consultant which is unexercisable at Termination of Employment or Termination of Consultancy, as applicable, shall thereafter become exercisable, except as may be otherwise provided by the Committee either in the Award Agreement or by action of the Committee following the grant of the Option. 9 (c) To the extent that the aggregate Fair Market Value of stock with respect to which "incentive stock options" (within the meaning of Section 422 of the Code, but without regard to Section 422(d) of the Code) are exercisable for the first time by a Holder during any calendar year (under the Plan and all other incentive stock option plans of the Company and any parent or subsidiary corporation, within the meaning of Section 422 of the Code) of the Company exceeds $ 100,000, such Options shall be treated as Non-Qualified Options to the extent required by Section 422 of the Code. The rule set forth in the preceding sentence shall be applied by taking Options into account in the order in which they were granted. For purposes of this Section 5.3(c), the Fair Market Value of stock shall be determined as of the time the Option with respect to such stock is granted. 5.5. Substitute Awards. ----------------- Notwithstanding the foregoing provisions of this Article V to the contrary, in the case of an Option that is a Substitute Award, the price per share of the shares subject to such Option may be less than the Fair Market Value per share on the date of grant, provided, that the excess of: -------- (a) the aggregate Fair Market Value (as of the date such Substitute Award is granted) of the shares subject to the Substitute Award; over (b) the aggregate exercise price thereof; does not exceed the excess of; (c) the aggregate fair market value (as of the time immediately preceding the transaction giving rise to the Substitute Award, such fair market value to be determined by the Committee) of the shares of the predecessor entity that were subject to the grant assumed or substituted for by the Company; over (d) the aggregate exercise price of such shares. ARTICLE VI. EXERCISE OF OPTIONS 6.1. Partial Exercise. An exercisable Option may be exercised in ---------------- whole or in part. However, an Option shall not be exercisable with respect to fractional shares and the Administrator may require that, by the terms of the Option, a partial exercise be with respect to a minimum number of shares. 6.2. Manner of Exercise. All or a portion of an exercisable Option ------------------ shall be deemed exercised upon delivery of all of the following to the Secretary of the Company or his Office: (a) A written notice complying with the applicable rules established by the Administrator stating that the Option, or a portion thereof, is exercised. The notice shall be signed by the Holder or other person then entitled to exercise the Option or such portion of the Option; 10 (b) Such representations and documents as the Administrator, in its absolute discretion, deems necessary or advisable to effect compliance with all applicable provisions of the Securities Act and any other federal or state securities laws or relations. The Administrator may, in its absolute discretion, also take whatever additional actions it deems appropriate to effect such compliance including, without limitation, placing legends on share certificates and issuing stop-transfer notices to agents and registrars; (c) In the event that the Option shall be exercised pursuant to Section 11.1 by any person or persons other than the Holder, appropriate proof of the right of such person or persons to exercise the Option; and (d) Full cash payment to the Secretary of the Company for the shares with respect to which the Option, or portion thereof, is exercised. However, the Administrator, may in its discretion (i) allow a delay in payment up to thirty (30) days from the date the Option, or portion thereof, is exercised; (ii) allow payment, in whole or in part, through the delivery of shares of Common Stock which have been owned by the Holder for at least six months, duly endorsed for transfer to the Company with a Fair Market Value on the date of delivery equal to the aggregate exercise price of the Option or exercised portion thereof; (iii) allow payment, in whole or in part, through the surrender of shares of Common Stock then issuable upon exercise of the Option having a Fair Market Value on the date of Option exercise equal to the aggregate exercise price of the Option or exercised portion thereof; (iv) allow payment, in whole or in part, through the delivery of property of any kind which constitutes good and valuable consideration; (v) allow payment, in whole or in part, through the delivery of a full recourse promissory note bearing interest (at no less than such rate as shall then preclude the imputation of interest under the Code) and payable upon such terms as may be prescribed by the Administrator; (vi) allow payment, in whole or in part, through the delivery of a notice that the Holder has placed a market sell order with a broker with respect to shares of Common Stock then issuable upon exercise of the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Company in satisfaction of the Option exercise price, provided that payment of such proceeds is then made to the Company -------- upon settlement of such sale; or (vii) allow payment through any combination of the consideration provided in the foregoing subparagraphs (ii), (iii), (iv), (v) and (vi). In the case of a promissory note, the Administrator may also prescribe the form of such note and the security to be given for such note. The Option may not be exercised, however, by delivery of a promissory note or by a loan from the Company when or where such loan or other extension of credit is prohibited by law. 6.3. Conditions to Issuance of Stock Certificates. The Company -------------------------------------------- shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of any Option or portion thereof prior to fulfillment of all of the following conditions: (a) The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; (b) The completion of any registration or other qualification of such shares under any state or federal law, or under the rulings or regulations of the Securities 11 and Exchange Commission or any other governmental regulatory body which the Administrator shall, in its absolute discretion, deem necessary or advisable; (c) The obtaining of any approval or other clearance from any state or federal governmental agency which the Administrator shall, in its absolute discretion, determine to be necessary or advisable; (d) The lapse of such reasonable period of time following the exercise of the Option as the Administrator may establish from time to time for reasons of administrative convenience; and (e) The receipt by the Company of full payment for such shares, including payment of any applicable withholding tax, which in the discretion of the Administrator may be in the form of consideration used by the Holder to pay for such shares under Section 6.2(d). 6.4. Rights as Stockholders. Holders shall not be, nor have any of ---------------------- the rights or privileges of, stockholders of the Company in respect of any shares purchasable upon the exercise of any part of an Option unless and until certificates representing such shares have been issued by the Company to such Holders. 6.5. Ownership and Transfer Restrictions. The Administrator, in its ----------------------------------- absolute discretion, may impose such restrictions on the ownership and transferability of the shares purchasable upon the exercise of an Option as it deems appropriate. Any such restriction shall be set forth in the respective Award Agreement and may be referred to on the certificates evidencing such shares. The Holder shall give the Company prompt notice of any disposition of shares of Common Stock acquired by exercise of an Incentive Stock Option within (a) two years from the date of granting (including the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code) such Option to such Holder or (b) one year after the transfer of such shares to such Holder. 6.6. Limitations on Exercise of Options Granted to Employees or ---------------------------------------------------------- Consultants. Notwithstanding anything herein to the contrary, except in the - ----------- case of Termination of Employment for cause or Termination of Consultancy for cause (as determined by the Administrator), to the extent that any portion of an Option granted to an Employee or Consultant is exercisable at Termination of Employment or Termination of Consultancy, as applicable, such portion shall be exercisable following Termination of Employment or Termination of Consultancy for a period which shall be determined by the Administrator in its sole discretion; provided, however, that such period shall end no sooner than -------- ------- (a) The earlier of (x) the expiration of the Option's term or (y) the expiration of six (6) months from the date of Termination of Employment or Termination of Consultancy, as applicable, if the Holder's termination is caused by the Holder's death or Disability; or (b) The earlier of (x) the expiration of the Option's term, or (y) the expiration of at least thirty (30) days from the date of Termination of Employment or 12 Termination of Consultancy, as applicable, if the Holder's termination is caused by other than the Holder's death or Disability. In the case of Termination of Employment or Termination of Consultancy for cause (as determined by the Administrator), the period within which any portion of an Option which is exercisable at the date of the Holder's termination may be exercised following such termination shall be determined by the Administrator in its sole discretion, but in no event shall extend beyond the expiration of the Option's term. 6.7. Additional Limitations on Exercise of Options. Holders may be --------------------------------------------- required to comply with any timing or other restrictions with respect to the settlement or exercise of an Option, including a window-period limitation, as may be imposed in the discretion of the Administrator. ARTICLE VII. AWARD OF RESTRICTED STOCK 7.1. Eligibility. Subject to the Award Limit, Restricted Stock may ----------- be awarded to any Employee who the Committee determines is a key Employee or any Consultant who the Committee determines should receive such an Award. 7.2. Award of Restricted Stock ------------------------- (a) The Committee may from time to time, in its absolute discretion: (i) Determine which Employees are key Employees and select from among the key Employees or Consultants (including Employees or Consultants who have previously received other awards under the Plan) such of them as in its opinion should be awarded Restricted Stock; and (ii) Determine the purchase price, if any, and other terms and conditions applicable to such Restricted Stock, consistent with the Plan. (b) The Committee shall establish the purchase price, if any, and form of payment for Restricted Stock; provided, however, that such -------- ------- purchase price shall be no less than 85% of the Fair Market Value of a share of Common Stock on the date the award of Restricted Stock is made or at the time the purchase of Restricted Stock is consummated, unless otherwise permitted by applicable state law, and provided, further, that, -------- ------- in the case of the award of Restricted Stock to an individual then owning more than 10% of the total combined voting power of all classes of stock of the Company or any Subsidiary or parent corporation thereof, such purchase price shall be no less than 100% of the Fair Market Value of a share of Common Stock on the date the award of Restricted Stock is made or at the time the purchase of Restricted Stock is consummated, unless otherwise permitted by applicable state law. In all cases, legal consideration shall be required for each issuance of Restricted Stock. 13 (c) Upon the selection of a key Employee or Consultant to be awarded Restricted Stock, the Committee shall instruct the Secretary of the Company to issue such Restricted Stock and may impose such conditions on the issuance of such Restricted Stock as it deems appropriate. 7.3. Rights as Stockholders. Subject to Section 7.4, upon delivery ---------------------- of the shares of Restricted Stock to the escrow holder pursuant to Section 7.6, the Holder shall have, unless otherwise provided by the Committee, all the rights of a stockholder with respect to said shares, subject to the restrictions in his Award Agreement, including the right to receive all dividends and other distributions paid or made with respect to the shares; provided, however, that -------- ------- in the discretion of the Committee, any extraordinary distributions with respect to the Common Stock shall be subject to the restrictions set forth in Section 7.4. 7.4. Restriction. All shares of Restricted Stock issued under the ----------- Plan (including any shares received by holders thereof with respect to shares of Restricted Stock as a result of stock dividends, stock splits or any other form of recapitalization) shall, in the terms of each individual Award Agreement, be subject to such restrictions as the Committee shall provide, which restrictions may include, without limitation, restrictions concerning voting rights and transferability and restrictions based on duration of employment with the Company, Company performance and individual performance; provided, however, -------- ------- that, unless the Committee otherwise provides in the terms of the Award Agreement or otherwise, no share of Restricted Stock granted to a person subject to Section 16 of the Exchange Act shall be sold, assigned or otherwise transferred until at least six months and one day have elapsed from the date on which the Restricted Stock was issued, and provided, further, that, except with -------- ------- respect to shares of Restricted Stock granted to Section 162(m) Participants, by action taken after the Restricted Stock is issued, the Committee may, on such terms and conditions as it may determine to be appropriate, remove any or all of the restrictions imposed by the terms of the Award Agreement. Restricted Stock may not be sold or encumbered until all restrictions are terminated or expire. If no consideration was paid by the Holder upon issuance, a Holder's rights in unvested Restricted Stock shall lapse, and such Restricted Stock shall be surrendered to the Company without consideration, upon Termination of Employment or, if applicable, upon Termination of Consultancy with the Company; provided, -------- however, that the Committee in its sole and absolute discretion may provide that - ------- such rights shall not lapse in the event of a Termination of Employment following a "change of ownership or control" (within the meaning of Treasury Regulation Section 1.162-27(e)(2)(v) or any successor regulation thereto) of the Company or because of the Holder's death or disability; provided, further, -------- ------- except with respect to shares of Restricted Stock granted to Section 162(m) Participants, the Committee in its sole and absolute discretion may provide that no such lapse or surrender shall occur in the event of a Termination of Employment, or a Termination of Consultancy, without cause or following any change in control of the Company or because of the Holder's retirement, or otherwise. 7.5. Repurchase of Restricted Stock. The Committee shall provide in ------------------------------ the terms of each individual Award Agreement that the Company shall have the right to repurchase from the Holder the Restricted Stock then subject to restrictions under the Award Agreement within ninety (90) days after a Termination of Employment or, if applicable, after a Termination of Consultancy between the Holder and the Company, at a cash price per share equal to the price paid by the Holder for such Restricted Stock; provided, however, that such right -------- ------- of repurchase 14 shall lapse at a rate of at least 20% of the shares of Restricted Stock per year over five (5) years from the date the Restricted Stock is awarded, and provided, -------- further, that the Committee in its sole and absolute discretion may provide that - ------- no such right of repurchase shall exist in the event of a Termination of Employment following a "change of ownership or control" (within the meaning of Treasury Regulation Section 1.162-27(e)(2)(v) or any successor regulation thereto) of the Company or because of the Holder's death or disability; provided, further, that, except with respect to shares of Restricted Stock - -------- ------- granted to Section 162(m) Participants, the Committee in its sole and absolute discretion may provide that no such right of repurchase shall exist in the event of a Termination of Employment or a Termination of Consultancy without cause or following any change in control of the Company or because of the Holder's retirement, or otherwise. 7.6. Escrow. The Secretary of the Company or such other escrow ------ holder as the Committee may appoint shall retain physical custody of each certificate representing Restricted Stock until all of the restrictions imposed under the Award Agreement with respect to the shares evidenced by such certificate expire or shall have been removed. 7.7. Legend. In order to enforce the restrictions imposed upon ------ shares of Restricted Stock hereunder, the Committee shall cause a legend or legends to be placed on certificates representing all shares of Restricted Stock that are still subject to restrictions under Award Agreements, which legend or legends shall make appropriate reference to the conditions imposed thereby. 7.8. Section 83(b) Election. If a Holder makes an election under ---------------------- Section 83(b) of the Code, or any successor section thereto, to be taxed with respect to the Restricted Stock as of the date of transfer of the Restricted Stock rather than as of the date or dates upon which the Holder would otherwise be taxable under Section 83(a) of the Code, the Holder shall deliver a copy of such election to the Company immediately after filing such election with the Internal Revenue Service. ARTICLE VIII. PERFORMANCE AWARDS, DIVIDEND EQUIVALENTS, DEFERRED STOCK AND STOCK PAYMENTS 8.1. Eligibility. Subject to the Award Limit, one or more ----------- Performance Awards, Dividend Equivalents, awards of Deferred Stock, and/or Stock Pavements may be granted to any Employee whom the Committee determines is a key Employee or any Consultant whom the Committee determines should receive such an Award. 8.2. Performance Awards. Any key Employee or Consultant selected by ------------------ the Committee may be granted one or more Performance Awards. The value of such Performance Awards may be linked to any one or more of the Performance Criteria or other specific performance criteria determined appropriate by the Committee, in each case on a specified date or dates or over any period or periods determined by the Committee. In making such determinations, the Committee shall consider (among such other factors as it deems relevant in 15 light of the specific type of award) the contributions, responsibilities and other compensation of the particular key Employee or Consultant. 8.3. Dividend Equivalents. -------------------- (a) Any key Employee or Consultant selected by the Committee may be granted Dividend Equivalents based on the dividends declared on Common Stock, to be credited as of dividend payment dates, during the period between the date a Stock Appreciation Right, Deferred Stock or Performance Award is granted, and the date such Stock Appreciation Right, Deferred Stock or Performance Award is exercised, vests or expires, as determined by the Committee. Such Dividend Equivalents shall be converted to cash or additional shares of Common Stock by such formula and at such time and subject to such limitations as may be determined by the Committee. (b) Any Holder of an Option who is an Employee or Consultant selected by the Committee may be granted Dividend Equivalents based on the dividends declared on Common Stock, to be credited as of dividend payment dates, during the period between the date an Option is granted, and the date such Option is exercised, vests or expires, as determined by the Committee. Such Dividend Equivalents shall be converted to cash or additional shares of Common Stock by such formula and at such time and subject to such limitations as may be determined by the Committee. (d) Dividend Equivalents granted with respect to Options intended to be qualified performance-based compensation for purposes of Section 162(m) of the Code shall be payable, with respect to pre-exercise periods, regardless of whether such Option is subsequently exercised. 8.4. Stock Payments. Any key Employee or Consultant selected by the -------------- Committee may receive Stock Payments in the manner determined from time to time by the Committee. The number of shares shall be determined by the Committee and may be based upon the Performance Criteria or other specific performance criteria determined appropriate by the Committee, determined on the date such Stock Payment is made or on any date thereafter. 8.5. Deferred Stock. Any key Employee or Consultant selected by the -------------- Committee may be granted an award of Deferred Stock in the manner determined from time to time by the Committee. The number of shares of Deferred Stock shall be determined by the Committee and may be linked to the Performance Criteria or other specific performance criteria determined to be appropriate by the Committee, in each case on a specified date or dates or over any period or periods determined by the Committee. Common Stock underlying a Deferred Stock award will not be issued until the Deferred Stock award has vested, pursuant to a vesting schedule or performance criteria set by the Committee. Unless otherwise provided by the Committee, a Holder of Deferred Stock shall have no rights as a Company stockholder with respect to such Deferred Stock until such time as the Award has vested and the Common Stock underlying the Award has been issued. 8.6. Term. The term of a Performance Award, Dividend Equivalent, ---- award of Deferred Stock and/or Stock Payment shall be set by the Committee in its discretion. 16 8.7. Exercise or Purchase Price. The Committee may establish the -------------------------- exercise or purchase price of a Performance Award, shares of Deferred Stock, or shares received as a Stock Payment; provided, however, that such price shall not -------- ------- be less than the par value for a share of Common Stock, unless otherwise permitted by applicable state law. 8.8. Exercise Upon Termination of Employment or Termination of --------------------------------------------------------- Consultancy. A Performance Award, Dividend Equivalent, award of Deferred Stock - ----------- and/or Stock Payment is exercisable or payable only while the Holder is an Employee or Consultant, as applicable; provided, however, that the Administrator -------- ------- in its sole and absolute discretion may provide that the Performance Award, Dividend Equivalent, award of Deferred Stock and/or Stock Payment may be exercised or paid subsequent to a Termination of Employment following a "change of control or ownership" (within the meaning of Section 1.162-27(e)(2)(v) or any successor regulation thereto) of the Company; provided, further, that except -------- ------- with respect to Performance Awards granted to Section 162(m) Participants, the Administrator in its sole and absolute discretion may provide that Performance Awards may be exercised or paid following a Termination of Employment or a Termination of Consultancy without cause, or following a change in control of the Company, or because of the Holder's retirement, death or disability, or otherwise. 8.9. Form of Payment. Payment of the amount determined under --------------- Section 8.2 or 8.3 above shall be in cash, in Common Stock or a combination of both, as determined by the Committee. To the extent any payment under this Article VIII is effected in Common Stock, it shall be made subject to satisfaction of all provisions of Section 6.3. ARTICLE IX. STOCK APPRECIATION RIGHTS 9.1. Grant of Stock Appreciation Rights. A Stock Appreciation Right ---------------------------------- may be granted to any key Employee or Consultant selected by the Committee. A Stock Appreciation Right may be granted (a) in connection and simultaneously with the grant of an Option, (b) with respect to a previously granted Option, or (c) independent of an Option. A Stock Appreciation Right shall be subject to such terms and conditions not inconsistent with the Plan as the Committee shall impose and shall be evidenced by an Award Agreement. 9.2. Coupled Stock Appreciation Rights. --------------------------------- (a) A Coupled Stock Appreciation Right ("CSAR") shall be related to a particular Option and shall be exercisable only when and to the extent the related Option is exercisable. (b) A CSAR may be granted to the Holder for no more than the number of shares subject to the simultaneously or previously granted Option to which it is coupled. (c) A CSAR shall entitle the Holder (or other person entitled to exercise the Option pursuant to the Plan) to surrender to the Company unexercised a portion of the Option to which the CSAR relates (to the extent then exercisable pursuant to its terms) and to receive from the Company in exchange therefor an amount determined by 17 multiplying the difference obtained by subtracting the Option exercise price from the Fair Market Value of a share of Common Stock on the date of exercise of the CSAR by the number of shares of Common Stock with respect to which the CSAR shall have been exercised, subject to any limitations the Committee may impose. 9.3. Independent Stock Appreciation Rights. ------------------------------------- (a) An Independent Stock Appreciation Right ("ISAR') shall be unrelated to any Option and shall have a term set by the Committee. An ISAR shall be exercisable in such installments as the Committee may determine. An ISAR shall cover such number of shares of Common Stock as the Committee may determine; provided, however, that unless the Committee otherwise provides in -------- ------- the terms of the ISAR or otherwise, no ISAR granted to a person subject to Section 16 of the Exchange Act shall be exercisable until at least six months have elapsed from (but excluding) the date on which the Option was granted. The exercise price per share of Common Stock subject to each ISAR shall be set by the Committee. An ISAR is exercisable only while the Holder is an Employee or Consultant; provided that the Committee may determine that the ISAR may be exercised subsequent to Termination of Employment or Termination of Consultancy without cause, or following a Change in Control of the Company, or because of the Holder's retirement, death or disability, or otherwise. (b) An ISAR shall entitle the Holder (or other person entitled to exercise the ISAR pursuant to the Plan) to exercise all or a specified portion of the ISAR (to the extent then exercisable pursuant to its terms) and to receive from the Company an amount determined by multiplying the difference obtained by subtracting the exercise price per share of the ISAR from the Fair Market Value of a share of Common Stock on the date of exercise of the ISAR by the number of shares of Common Stock with respect to which the ISAR shall have been exercised, subject to any limitations the Committee may impose. 9.4. Payment and Limitations on Exercise. ----------------------------------- (a) Payment of the amounts determined under Section 9.2(c) and 9.3(b) above shall be in cash, in Common Stock (based on its Fair Market Value as of the date the Stock Appreciation Right is exercised) or a combination of both, as determined by the Committee. To the extent such payment is effected in Common Stock it shall be made subject to satisfaction of all provisions of Section 6.3 above pertaining to Options. (b) Holders of Stock Appreciation Rights may be required to comply with any timing or other restrictions with respect to the settlement or exercise of a Stock Appreciation Right, including a window-period limitation, as may be imposed in the discretion of the Committee. 18 ARTICLE X. ADMINISTRATION 10.1. Compensation Committee. Prior to the Company's initial ---------------------- registration of Common Stock under Section 12 of the Exchange Act, the Compensation Committee shall consist of the entire Board. Following such registration, The Compensation Committee (or another committee or a subcommittee of the Board assigning the functions of the Committee under the Plan) shall consist solely of two or more Independent Directors appointed by and holding office at the pleasure of the Board, each of whom is both a "non-employee director" as defined by Rule 16b-3 and an "outside director" for purposes of Section 162(m) of the Code. Appointment of Committee members shall be effective upon acceptance of appointment. Committee members may resign at any time by delivering written notice to the Board. Vacancies in the Committee may be filled by the Board. 10.2. Duties and Powers of Committee. It shall be the duty of the ------------------------------ Committee to conduct the general administration of the Plan in accordance with its provisions. The Committee shall have the power to interpret the Plan and the Award Agreements, and to adopt such rules for the administration, interpretation, and application of the Plan as are consistent therewith, to interpret, amend or revoke any such rules and to amend any Award Agreement provided that the rights or obligations of the Holder of the Award that is the subject of any such Award Agreement are not affected adversely. Any such grant or award under the Plan need not be the same with respect to each Holder. Any such interpretations and rules with respect to Incentive Stock Options shall be consistent with the provisions of Section 422 of the Code. In its absolute discretion, the Board may at any time and from time to time exercise any and all rights and duties of the Committee under the Plan except with respect to matters which under Rule 16b-3 or Section 162(m) of the Code, or any regulations or rules issued thereunder, are required to be determined in the sole discretion of the Committee. 10.3. Majority Rule; Unanimous Written Consent. The Committee shall ---------------------------------------- act by a majority of its members in attendance at a meeting at which a quorum is present or by a memorandum or other written instrument signed by all members of the Committee. 10.4. Compensation; Professional Assistance; Good Faith Actions. --------------------------------------------------------- Members of the Committee shall receive such compensation, if any, for their services as members as may be determined by the Board. All expenses and liabilities which members of the Committee incur in connection with the administration of the Plan shall be borne by the Company. The Committee may, with the approval of the Board, employ attorneys, consultants, accountants, appraisers, brokers, or other persons. The Committee, the Company and the Company's officers and Directors shall be entitled to rely upon the advice, opinions or valuations of any such persons. All actions taken and all interpretations and determinations made by the Committee or the Board in good faith shall be final and binding upon all Holders, the Company and all other interested persons. No members of the Committee or Board shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or Awards, and all members of the Committee and the Board shall be fully protected by the Company in respect of any such action, determination or interpretation. 19 10.5. Delegation of Authority to Grant Awards. The Committee may, --------------------------------------- but need not, delegate from time to time some or all of its authority to grant Awards under the Plan to a committee consisting of one or more members of the Committee or of one or more officers of the Company; provided, however, that the Committee may not delegate its authority to grant Awards to individuals (i) who are subject on the date of the grant to the reporting rules under Section 16(a) of the Exchange Act, (ii) who are Section 162(m) Participants or (iii) who are officers of the Company who are delegated authority by the Committee hereunder. Any delegation hereunder shall be subject to the restrictions and limits that the Committee specifies at the time of such delegation of authority and may be rescinded at any time by the Committee. At all times, any committee appointed under this Section 10.5 shall serve in such capacity at the pleasure of the Committee. ARTICLE XI. MISCELLANEOUS PROVISIONS 11.1. Not Transferable. No Award under the Plan may be sold, ---------------- pledged, assigned or transferred in any manner other than by will or the laws of descent and distribution or, subject to the consent of the Administrator pursuant to a DRO, unless and until such Award has been exercised, or the shares underlying such Award have been issued, and all restrictions applicable to such shares have lapsed. No Award or interest or right therein shall be liable for the debts, contracts or engagements of the Holder or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence. During the lifetime of the Holder, only he may exercise an Option or other Award (or any portion thereof) granted to him under the Plan, unless it has been disposed of with the consent of the Administrator pursuant to a DRO. After the death of the Holder, any exercisable portion of an Option or other Award may, prior to the time when such portion becomes unexercisable under the Plan or the applicable Award Agreement, be exercised by his personal representative or by any person empowered to do so under the deceased Holder's will or under the then applicable laws of descent and distribution. 11.2. Amendment, Suspension or Termination of the Plan. Except as ------------------------------------------------ otherwise provided in this Section 11.2, the Plan may be wholly or partially amended or otherwise modified, suspended or terminated at any time or from time to time by the Administrator. However, without approval of the Company's stockholders given within twelve months before or after the action by the Administrator, no action of the Administrator may, except as provided in Section 11.3, increase the limits imposed in Section 2.1 on the maximum number of shares which may be issued under the Plan. No amendment, suspension or termination of the Plan shall, without the consent of the Holder alter or impair any rights or obligations under any Award theretofore granted or awarded, unless the Award itself otherwise expressly so provides. No Awards may be granted or awarded during any period of suspension or after termination of the 20 Plan, and in no event may any Incentive Stock Option be granted under the Plan after the first to occur of the following events: (a) The expiration of ten years from the date the Plan is adopted by the Board; or (b) The expiration of ten years from the date the Plan is approved by the Company's stockholders under Section 11.4. 11.3. Changes in Common Stock or Assets of the Company, Acquisition ------------------------------------------------------------- or Liquidation of the Company and Other Corporate Events. - -------------------------------------------------------- (a) Subject to Section 11.3 (d), in the event that the Administrator determines that any dividend or other distribution (whether in the form of cash, Common Stock, other securities, or other property), recapitalization, reclassification, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, liquidation, dissolution, or sale, transfer, exchange or other disposition of all or substantially all of the assets of the Company, or exchange of Common Stock or other securities of the Company, issuance of warrants or other rights to purchase Common Stock or other securities of the Company, or other similar corporate transaction or event, in the Administrator's sole discretion, affects the Common Stock such that an adjustment is determined by the Administrator to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to an Award, then the Administrator shall, in such manner as it may deem equitable, adjust any or all of (i) the number and kind of shares of Common Stock (or other securities or property) with respect to which Awards may be granted or awarded (including, but not limited to, adjustments of the limitations in Section 2.1 on the maximum number and kind of shares which may be issued and adjustments of the Award Limit), (ii) the number and kind of shares of Common Stock (or other securities or property) subject to outstanding Awards, and (iii) the grant or exercise price with respect to any Award. (b) Subject to Section 11.3(d), in the event of any transaction or event described in Section 11.3(a) or any unusual or nonrecurring transactions or events affecting the Company, any affiliate of the Company, or the financial statements of the Company or any affiliate, or of changes in applicable laws, regulations, or accounting principles, the Administrator, in its sole and absolute discretion, and on such terms and conditions as it deems appropriate, either by the terms of the Award or by action taken prior to the occurrence of such transaction or event and either automatically or upon the Holder's request, is hereby authorized to take any one or more of the following actions whenever the Administrator determines that such action is appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available 21 under the Plan or with respect to any Award under the Plan, to facilitate such transactions or events or to give effect to such changes in laws, regulations or principles: (i) To provide for either the purchase of any such Award for an amount of cash equal to the amount that could have been attained upon the exercise of such Award or realization of the Holder's rights had such Award been currently exercisable or payable or fully vested or the replacement of such Award with other rights or property selected by the Administrator in its sole discretion; (ii) To provide that the Award cannot vest, be exercised or become payable after such event; (iii) To provide that such Award shall be exercisable as to all shares covered thereby, notwithstanding anything to the contrary in Section 5.3 or the provisions of such Award; (iv) To provide that such Award be assumed by the successor or survivor corporation, or a parent or subsidiary thereof, or shall be substituted for by similar options, rights or awards covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices; and (v) To make adjustments in the number and type of shares of Common Stock (or other securities or property) subject to outstanding Awards, and in the number and kind of outstanding Restricted Stock or Deferred Stock and/or in the terms and conditions of (including the grant or exercise price), and the criteria included in, outstanding options, rights and awards and options, rights and awards which may be granted in the future. (vi) To provide that, for a specified period of time prior to such event, the restrictions imposed under an Award Agreement upon some or all shares of Restricted Stock or Deferred Stock may be terminated, and, in the case of Restricted Stock, some or all shares of such Restricted Stock may cease to be subject to repurchase under Section 7.5 or forfeiture under Section 7.4 after such event. (c) Subject to Sections 11.3(d), 3.2 and 3.3, the Administrator may, in its discretion, include such further provisions and limitations in any Award, agreement or certificate, as it may deem equitable and in the best interests of the Company. (d) With respect to Awards which are granted to Section 162(m) Participants and are intended to qualify as performance-based compensation under Section 162(m)(4)(C), no adjustment or action described in this Section 11.3 or in any other provision of the Plan shall be authorized to the extent that such adjustment or action would cause such Award to fail to so qualify under Section 162(m)(4)(C), or any successor provisions thereto. No adjustment or action described in this Section 11.3 or in any other provision of the Plan shall be authorized to the extent that such adjustment or action would cause the Plan to violate Section 422(b)(1) of the Code. Furthermore, no 22 such adjustment or action shall be authorized to the extent such adjustment or action would result in short-swing profits liability under Section 16 or violate the exemptive conditions of Rule 16b-3 unless the Administrator determines that the Award is not to comply with such exemptive conditions. The number of shares of Common Stock subject to any Award shall always be rounded to the next whole number. (e) Notwithstanding the foregoing, in the event that the Company becomes a party to a transaction that is intended to qualify for "pooling of interests" accounting treatment and, but for one or more of the provisions of this Plan or any Award Agreement would so qualify, then this Plan and any Award Agreement shall be interpreted so as to preserve such accounting treatment, and to the extent that any provision of the Plan or any Award Agreement would disqualify the transaction from pooling of interests accounting treatment (including, if applicable, an entire Award Agreement), then such provision shall be null and void. All determinations to be made in connection with the preceding sentence shall be made by the independent accounting firm whose opinion with respect to "pooling of interests" treatment is required as a condition to the Company's consummation of such transaction. (f) The existence of the Plan, the Award Agreement and the Awards granted hereunder shall not affect or restrict in any way the right or power of the Company or the shareholders of the Company to make or authorize any adjustment, recapitalization, reorganization or other change in the Company's capital structure or its business, any merger or consolidation of the Company, any issue of stock or of options, warrants or rights to purchase stock or of bonds, debentures, preferred or prior preference stocks whose rights are superior to or affect the Common Stock or the rights thereof or which are convertible into or exchangeable for Common Stock, 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, whether of a similar character or otherwise. 11.4. Approval of Plan by Stockholders. The Plan will be submitted -------------------------------- for the approval of the Company's stockholders within twelve months after the date of the Board's initial adoption of the Plan. Awards may be granted or awarded prior to such stockholder approval, provided that such Awards shall not be exercisable nor shall such Awards vest prior to the time when the Plan is approved by the stockholders, and provided further that if such approval has not been obtained at the end of said twelve-month period, all Awards previously granted or awarded under the Plan shall thereupon be canceled and become null and void. In addition, if the Board determines that Awards other than Options or Stock Appreciation Rights which may be granted to Section 162(m) Participants should continue to be eligible to qualify as performance-based compensation under Section 162(m)(4)(C) of the Code, the Performance Criteria must be disclosed to and approved by the Company's stockholders no later than the first stockholder meeting that occurs in the fifth year following the year in which the Company's stockholders previously approved the Performance Criteria. 11.5. Tax Withholding. The Company shall be entitled to require --------------- payment in cash or deduction from other compensation payable to each Holder of any sums required by federal, state or local tax law to be withheld with respect to the issuance, vesting, exercise or 23 payment of any Award. The Administrator may in its discretion and in satisfaction of the foregoing requirement allow such Holder to elect to have the Company withhold shares of Common Stock otherwise issuable under such Award (or allow the return of shares of Common Stock) having a Fair Market Value equal to the sums required to be withheld. 11.6. Loans. The Committee may, in its discretion, extend one or ----- more loans to key Employees in connection with the exercise or receipt of an Award granted or awarded under the Plan, or the issuance of Restricted Stock or Deferred Stock awarded under the Plan. The terms and conditions of any such loan shall be set by the Committee. 11.7. Forfeiture Provisions. Pursuant to its general authority to --------------------- determine the terms and conditions applicable to Awards under the Plan, the Administrator shall have the right to provide, in the terms of Awards made under the Plan, or to require a Holder to agree by separate written instrument, that (a) (i) any proceeds, gains or other economic benefit actually or constructively received by the Holder upon any receipt or exercise of the Award, or upon the receipt or resale of any Common Stock underlying the Award, must be paid to the Company, and (ii) the Award shall terminate and any unexercised portion of the Award (whether or not vested) shall be forfeited, if (b)(i) a Termination of Employment, Termination of Consultancy or Termination of Directorship occurs prior to a specified date, or within a specified time period following receipt or exercise of the Award, or (ii) the Holder at any time, or during a specified time period, engages in any activity in competition with the Company, or which is inimical, contrary or harmful to the interests of the Company, as further defined by the Administrator or (iii) the Holder incurs a Termination of Employment, Termination of Consultancy or Termination of Directorship for cause. 11.8. Effect of Plan Upon Options and Compensation Plans. The -------------------------------------------------- adoption of the Plan shall not affect any other compensation or incentive plans in effect for the Company or any Subsidiary. Nothing in the Plan shall be construed to limit the right of the Company (a) to establish any other forms of incentives or compensation for Employees, Directors or Consultants of the Company or any Subsidiary or (b) to grant or assume options or other rights or awards otherwise than under the Plan in connection with any proper corporate purpose including but not by way of limitation, the grant or assumption of options in connection with the acquisition by purchase, lease, merger, consolidation or otherwise, of the business, stock or assets of any corporation, partnership, limited liability company, firm or association. 11.9. Compliance with Laws. The Plan, the granting and vesting of -------------------- Awards under the Plan and the issuance and delivery of shares of Common Stock and the payment of money under the Plan or under Awards granted or awarded hereunder are subject to compliance with all applicable federal and state laws, rules and regulations (including but not limited to state and federal securities law and federal margin requirements) and to such approvals by any listing, regulatory or governmental authority as may, in the opinion of counsel for the Company, be necessary or advisable in connection therewith. Any securities delivered under the Plan shall be subject to such restrictions, and the person acquiring such securities shall, if requested by the Company, provide such assurances and representations to the Company as the Company may deem necessary or desirable to assure compliance with all applicable legal requirements. To the extent permitted by applicable law, the Plan and Awards granted or awarded hereunder shall be deemed amended to the extent necessary to conform to such laws, rules and regulations. 24 11.10 Titles. Titles are provided herein for convenience only and ------ are not to serve as a basis for interpretation or construction of the Plan. 11.11 Governing Law. The Plan and any agreements hereunder shall be ------------- administered, interpreted and enforced under the internal laws of the State of Delaware without regard to conflicts of laws thereof. I hereby certify that the foregoing Plan was duly adopted by the Board of Directors of COMPS InfoSystems, Inc. on November 6, 1998. Executed on this 6 day of November, 1998. /s/ Robert C. Beasley ------------------------------- Secretary 25 EX-10.34 39 1998 SUPPLEMENTAL OPTION PLAN EXHIBIT 10.34 COMPS INFOSYSTEMS, INC. 1998 SUPPLEMENTAL STOCK OPTION PLAN FORM OF NOTICE OF GRANT OF STOCK OPTION --------------------------------------- Notice is hereby given of the following option grant (the "Option") to purchase shares of the Class B Common Stock of COMPS InfoSystems, Inc. (the "Corporation"): Optionee: _________________ - -------- Grant Date: _______________ - ---------- Vesting Commencement Date: __________________ - ------------------------- Exercise Price: $____ per share - -------------- Number of Option Shares: _________ shares of Class B Common Stock as Incentive - ----------------------- Stock Option Shares; and _________ shares of Class B Common Stock as Non- Statutory Stock Option Shares Expiration Date: ____________ - --------------- Type of Option: - -------------- _____ Incentive Stock Option _____ Non-Statutory Stock Option Date Exercisable: ________________ - ---------------- Vesting Schedule: The shares of the Corporation's Class B Common Stock subject - ---------------- to this option (the "Option Shares") shall initially be unvested and subject to repurchase by the Corporation at the Exercise Price paid per share. Optionee shall acquire a vested interest in, and the Corporation's repurchase right shall accordingly lapse, with respect to (i) 20% of the Incentive Stock Option Shares on the Vesting Commencement Date, (ii) 100% of the Non-Statutory Stock Option Shares on the Vesting Commencement Date and (ii) the remaining 80% of the Incentive Stock Option Shares shall vest in successive equal monthly installments over a forty-eight (48) month period commencing on January 1, 1999. Optionee understands and agrees that the Option is granted subject to and in accordance with the terms of the Corporation's 1998 Supplemental Option Plan (the "Plan"). Optionee understands that any Option Shares purchased under the Option will be subject to the terms set forth in the Purchase Agreements attached hereto as Exhibit C. Optionee hereby acknowledges receipt of a copy of the Plan in the form attached hereto as Exhibit D. REPURCHASE RIGHTS. OPTIONEE HEREBY AGREES THAT ALL OPTION SHARES ACQUIRED UPON THE EXERCISE OF THE OPTION SHALL BE SUBJECT TO CERTAIN RIGHTS OF FIRST REFUSAL EXERCISABLE BY THE CORPORATION AND ITS ASSIGNS. THE TERMS OF SUCH RIGHTS ARE SPECIFIED IN THE ATTACHED STOCK PURCHASE AGREEMENT. No Employment or Service Contract. Nothing in this Notice or in the --------------------------------- attached Incentive Stock Option Agreement, Non-Statutory Option Agreement or Plan shall confer upon Optionee any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation (or any Parent or Subsidiary employing or retaining Optionee) or of Optionee, which rights are hereby expressly reserved by each, to terminate Optionee's Service at any time for any reason, with or without cause. Definitions. All capitalized terms in this Notice shall have the ----------- meaning assigned to them in this Notice or in the attached Incentive Stock Option Agreement or Non-Statutory Option Agreement. DATED: ___________, 1998 COMPS INFOSYSTEMS, INC. --------------------------------------- Christopher A. Crane, President OPTIONEE: --------------------------------------- Attachments (Not Included): - --------------------------- EXHIBIT A - INCENTIVE STOCK OPTION AGREEMENT (NOT INCLUDED) EXHIBIT B - NON-STATUTORY OPTION AGREEMENT EXHIBIT C - STOCK PURCHASE AGREEMENT (NOT INCLUDED) EXHIBIT D - 1998 SUPPLEMENTAL OPTION PLAN (NOT INCLUDED) 2 Exhibit B NON-QUALIFIED STOCK OPTION AGREEMENT THIS AGREEMENT, dated ___________, 199_ is made by and between COMPS InfoSystems, Inc., a Delaware corporation hereinafter referred to as "Company," and _____________, hereinafter referred to as "Optionee": WHEREAS, the Company wishes to afford the Optionee the opportunity to purchase shares of its $.0l par value non-voting Class B Common Stock; and WHEREAS, the Board of Directors of the Company has determined that it would be to the advantage and best interest of the Company and its shareholders to grant the Non-Qualified Option provided for herein to the Optionee, and has advised the Company thereof and instructed the undersigned officers to issue said Option; NOW, THEREFORE, in consideration of the mutual covenants herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto do hereby agree as follows: ARTICLE I DEFINITIONS Whenever the following terms are used in this Agreement, they shall have the meaning specified below unless the context clearly indicates to the contrary. The masculine pronoun shall include the feminine and neuter, and the singular the plural, where the context so indicates. 1.1. Administrator - ---- ------------- "Administrator" shall mean: the Board. 1.2. Board - ---- ----- "Board" shall mean the Board of Directors of the Company. 1.3. Code - ---- ---- "Code" shall mean the Internal Revenue Code of 1986, as amended. 1.4. Committee - ---- --------- "Committee" shall mean the Stock Option Committee of the Board. 1.5. Common Stock - ---- ------------ "Common Stock" shall mean the Company's non-voting Class B Common Stock, par value $.0l per share. 1.6. Company - ---- ------- "Company" shall mean COMPS InfoSystems, Inc. 1.7. Exchange Act - ---- ------------ "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. 1.8. Initial Public Offering - ---- ----------------------- "Initial Public Offering" shall mean the closing of the sale of the Company's securities pursuant to an underwritten public offering. 1.9. Option - ---- ------ "Option" shall mean the non-qualified option to purchase Common Stock of the Company granted under this Agreement. 1.10. Rule 16b-3 - ----- ---------- "Rule 16b-3" shall mean that certain Rule 16b-3 under the Exchange Act, as such Rule may be amended in the future. 1.11. Secretary - ----- --------- "Secretary" shall mean the Secretary of the Company. 1.12. Securities Act - ----- -------------- "Securities Act" shall mean the Securities Act of 1933, as amended. ARTICLE II. GRANT OF OPTION 2.1. Grant of Option - ---- --------------- On the date hereof the Company irrevocably grants to the Optionee the option to purchase any part or all of an aggregate of __________ shares of its $.0l par value non-voting Class B Common Stock upon the terms and conditions set forth in this Agreement. 2.2. Purchase Price - ---- -------------- The purchase price of the shares of stock covered by the Option shall be $.__ per share without commission or other charge. 2.3. Adjustments in Option - ---- --------------------- In the event that the outstanding shares of the stock subject to the Option are changed into or exchanged for a different number or kind of shares of the Company or other securities of the Company by reason of merger, consolidation, recapitalization, reclassification, stock split up, stock dividend or combination of shares, the Administrator shall make an appropriate and equitable adjustment in the number and kind of shares as to which the Option, or portions thereof then unexercised, shall be exercisable, to the end that after such event the Optionee's proportionate interest shall be maintained as before the occurrence of such event. Such adjustment in the Option shall be made without change in the total price applicable to the unexercised portion of the Option (except for any change in the aggregate price resulting from rounding-off of share quantities or prices) and with any necessary corresponding adjustment in the Option price per share. Any such adjustment made by the Administrator shall be final and binding upon the Optionee, the Company and all other interested persons. ARTICLE III. PERIOD OF EXERCISABILITY 3.1. Commencement of Exercisability - ---- ------------------------------ The Option shall become exercisable immediately upon execution and delivery of this Agreement. 3.2. Duration of Exercisability - ---- -------------------------- The Option shall remain exercisable until it becomes unexercisable under Section 3.3. 3.3. Expiration of Option - ---- -------------------- The Option may not be exercised to any extent by anyone after the first to occur of the following events: (a) The expiration of ten (10) years from the date the Option was granted; or (b) The expiration of one (1) year from the date of the Optionee's death; or (c) The effective date of either the merger or consolidation of the Company with or into another corporation, or the acquisition by another corporation or person of all or substantially all of the Company's assets or eighty percent (80%) or more of the Company's then outstanding voting stock, or the liquidation or dissolution of the Company, unless the Administrator waives this provision in connection with such transaction. At least ten (10) days prior to the effective date of such merger, consolidation, acquisition, liquidation or dissolution, the Administrator shall give the Optionee notice of such event if the Option has then neither been fully exercised nor become unexercisable under this Section 3.3. ARTICLE IV. EXERCISE OF OPTION 4.1. Person Eligible to Exercise - ---- --------------------------- During the lifetime of the Optionee, only he may exercise the Option or any portion thereof. After the death or incapacity of the Optionee, any exercisable portion of the Option may, prior to the time when the Option becomes unexercisable under Section 3.3, be exercised by his personal representative or by any person empowered to do so under the Optionee's will or under the then applicable laws of descent and distribution. 4.2. Partial Exercise - ---- ---------------- Any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time prior to the time when the Option or portion thereof becomes unexercisable under Section 3.3; provided, however, that each partial exercise shall be for not less than One Thousand (1000) shares (or the minimum installment set forth in Section 3.1, if a smaller number of shares) and shall be for whole shares only. 4.3. Manner of Exercise - ---- ------------------ The Option, or any exercisable portion thereof, may be exercised solely by delivery to the Secretary or his office of all of the following prior to the time when the Option or such portion becomes unexercisable under Section 3.3: (a) Notice in writing signed by the Optionee or the other person then entitled to exercise the Option or portion, stating that the Option or portion is thereby exercised, such notice complying with all applicable rules established by the Committee; and (i) Full payment (by cashiers check or wire transfer) for the shares with respect to which such Option or portion is exercised; or (ii) With the consent of the Administrator, (A) shares of the Company's Common Stock owned by the Optionee duly endorsed for transfer to the Company or (B) subject to the timing requirements of Section 4.4, shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option, with a fair market value on the date of Option exercise equal to the aggregate purchase price of the shares with respect to which such Option or portion is exercised; or (iii) With the consent of the Administrator, a promissory note bearing interest (at no less than such rate as shall then preclude the imputation of interest under the Code or successor provision) and payable upon such terms as may be prescribed by the Administrator. The Administrator may also prescribe the form of such note and the security to be given for such note. That Option may not be exercised, however, by delivery of a promissory note or by a loan from the Company when or where such loan or other extension of credit is prohibited by law; or (iv) With the consent of the Administrator, any combination of the consideration provided in the foregoing subparagraphs (i) - (iii); and (b) A bona fide written representation and agreement, in a form satisfactory to the Administrator, signed by the Optionee or other person then entitled to exercise such Option or portion, stating that the shares of stock are being acquired for his own account, for investment and without any present intention of distributing or reselling said shares or any of them except as may be permitted under the Securities Act and then applicable rules and regulations thereunder, and that the Optionee or other person then entitled to exercise such Option or portion will indemnify the Company against and hold it free and harmless from any loss, damage, expense or liability resulting to the Company if any sale or distribution of the shares by such person is contrary to the representation and agreement referred to above. The Administrator may, in its absolute discretion, take whatever additional actions it deems appropriate to insure the observance and performance of such representation and agreement and to effect compliance with the Securities Act and any other federal or state securities laws or regulations. Without limiting the generality of the foregoing, the Administrator may require an opinion of counsel acceptable to it to the effect that any subsequent transfer of shares acquired on an Option exercise does not violate the Securities Act, and may issue stop-transfer orders covering such shares. Share certificates evidencing stock issued on exercise of this Option shall bear an appropriate legend referring to the provisions of this subsection (c) and the agreements herein. The written representation and agreement referred to in the first sentence of this subsection (c) shall, however, not be required if the shares to be issued pursuant to such exercise have been registered under the Securities Act, and such registration is then effective in respect of such shares; and (c) Full payment to the Company (or other employer corporation) of all amounts which, under federal, state or local tax law, it is required to withhold upon exercise of the Option; with the consent of the Administrator, (i) shares of the Company's Common Stock owned by the Optionee duly endorsed for transfer, or (ii) subject to the timing requirements of Section 4.4, shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option, valued at fair market value at the date of Option exercise, may be used to make all or part of such payment; and (d) In the event the Option or portion shall be exercised pursuant to Section 4.1 by any person or persons other than the Optionee, appropriate proof of the right of such person or persons to exercise the Option. 4.4. Certain Timing Requirements - ---- --------------------------- Shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option may be used to satisfy the Option price or the tax withholding consequences of such exercise only (i) during the period beginning on the third (3rd) business day following the date of release of the quarterly or annual summary statement of sales and earnings of the Company and ending on the twelfth (12th) business day following such date or (ii) pursuant to an irrevocable written election by the Optionee to use shares of the Company's Common Stock issuable to the Optionee upon exercise of the Option to pay all or part of the Option price or the withholding taxes (subject to the approval of the Administrator) made at least six (6) months prior to the payment of such Option price or withholding taxes. 4.5. Conditions to Issuance of Stock Certificates - ---- -------------------------------------------- The shares of stock deliverable upon the exercise of the Option, or any portion thereof, may be either previously authorized but unissued shares or issued shares which have then been reacquired by the Company. Such shares shall be fully paid and nonassessable. The Company shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of the Option or portion thereof prior to fulfillment of all of the following conditions: (a) The admission of such shares to listing on all stock exchanges on which such class of stock is then listed; and (b) The completion of any registration or other qualification of such shares under any state or federal law or under rulings or regulations of the Securities and Exchange Commission or of any other governmental regulatory body, which the Administrator shall, in its absolute discretion, deem necessary or advisable; and (c) The obtaining of any approval or other clearance from any state or federal governmental agency which the Administrator shall, in its absolute discretion, determine to be necessary or advisable; and (d) The payment to the Company (or other employer corporation) of all amounts which, under federal, state or local tax law, it is required to withhold upon exercise of the Option; and (e) The lapse of such reasonable period of time following the exercise of the Option as the Administrator may from time to time establish for reasons of administrative convenience. 4.6. Rights as Shareholder - ---- --------------------- The holder of the Option shall not be, nor have any of the rights or privileges of, a shareholder of the Company in respect of any shares purchasable upon the exercise of any part of the Option unless and until certificates representing such shares shall have been issued by the Company to such holder. ARTICLE V. OTHER PROVISIONS 5.1. Administration - ---- -------------- The Administrator shall have the power to interpret this Agreement and to adopt such rules for the administration, interpretation and application of this Agreement as are consistent therewith and to interpret or revoke any such rules. All actions taken and all interpretations and determinations made by the Administrator in good faith shall be final and binding upon the Optionee, the Company and all other interested persons. No member of the Administrator shall be personally liable for any action, determination or interpretation made in good faith with respect to this Agreement or the Option. In the event that the Administrator is the Committee, the Board shall have no right to exercise any of the rights or duties of the Committee under this Agreement. 5.2. Option Not Transferable - ---- ----------------------- Neither the Option nor any interest or right therein or part thereof shall be liable for the debts, contracts or engagements of the Optionee or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect; provided, however, that this Section 5.2 shall not prevent transfers by will or by the applicable laws of descent and distribution. 5.3. Shares to Be Reserved - ---- --------------------- The Company shall at all times during the term of the Option reserve and keep available such number of shares of stock as will be sufficient to satisfy the requirements of this Agreement. 5.4. Notices - ---- ------- Any notice to be given under the terms of this Agreement to the Company shall be addressed to the Company in care of its Secretary, and any notice to be given to the Optionee shall be addressed to him at the address given beneath his signature hereto. By a notice given pursuant to this Section 5.4, either party may hereafter designate a different address for notices to be given to him. Any notice which is required to be given to the Optionee shall, if the Optionee is then deceased, be given to the Optionee's personal representative if such representative has previously informed the Company of his status and address by written notice under this Section 5.4. Any notice shall be deemed duly given when enclosed in a properly sealed envelope or wrapper addressed as aforesaid, deposited (with postage prepaid) in a post office or branch post office regularly maintained by the United States Postal Service. 5.5. Titles - ---- ------ Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement. 5.6. Construction - ---- ------------ This Agreement shall be administered, interpreted and enforced under the laws of the State of Delaware. 5.7. Conformity to Securities Laws - ---- ----------------------------- The Optionee acknowledges that this Agreement is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the Securities and Exchange Commission thereunder, including without limitation Rule 16b-3. Notwithstanding anything herein to the contrary, this Agreement shall be administered, and the Option is granted and may be exercised, only in such a manner as to conform to such laws, rules and regulations. To the extent permitted by applicable law, this Agreement shall be deemed amended to the extent necessary to conform to such laws, rules and regulations. 5.8. Restrictions on Transfer of Shares - ---- ---------------------------------- (a) There can be no valid transfer (as hereinafter defined) of any shares of stock purchased on exercise of the Option, or any interest in such shares, by any holder of such shares or interests unless such transfer is solely for cash consideration and is made in compliance with the following provisions: (i) Before there can be a valid transfer of any shares or any interest therein, the record holder of the shares to be transferred (the "Offered Shares') shall give written notice (by registered or certified mail) to the Company. Such notice shall specify (i) the bona fide intent of the record holder of the Offered Shares (hereinafter referred to as the "Offeror") to sell or otherwise transfer the Offered Shares to a bona fide third-party transferee (ii) the identity of the proposed transferee, (iii) the number of Offered Shares to be transferred to the proposed transferee, (iv) the cash price offered for the Offered Shares by the proposed transferee (the "Offered Price") and (v) the other terms and conditions of the proposed transfer. The date such notice is mailed shall be hereinafter referred to as the "notice date" and the record holder of the Offered Shares shall be hereinafter referred to as the "Offeror." (ii) For a period of thirty (30) calendar days after the notice date, the Company shall have the option to purchase all (but not less than all) of the Offered Shares at the purchase price and on the terms set forth in subsection (a)(iii) of this Section 5.8. This option shall be exercisable by the Company by mailing (by registered or certified mail) written notice of exercise to the Offeror prior to the end of said thirty (30) days. (iii) The price at which the Company may purchase the Offered Shares pursuant to the exercise of such option shall be (A) if the notice date is prior to the date of the Initial Public Offering, the Offered Price (as set forth in the notice required under subsection (a)(i) of this Section 5.8), and (B) if the notice date is after the date of the Initial Public Offering, the fair market value of the Offered Shares on the notice date. The Company's notice of exercise of such option shall be accompanied by full payment for the Offered Shares and, upon such payment by the Company, the Company shall acquire full right, title and interest to all of the Offered Shares. (iv) If, and only if, the option given pursuant to subsection (a)(ii) of this Section 5.8 is not exercised, the transfer proposed in the notice given pursuant to subsection (a)(i) of this Section 5.8 may take place; provided, however, that such transfer must, in all respects, be exactly as proposed in said notice except that such transfer may not take place either before the tenth (10th) calendar day after the expiration of said thirty-day option exercise period or after the ninetieth (90th) calendar day after the expiration of said thirty-day option exercise period, and if such transfer has not taken place prior to said ninetieth (90th) day, such transfer may not take place without once again complying with subsection (a) of this Section 5.8. (b) As used in this Section 5.8, the term "transfer" means any sale, encumbrance, pledge, gift or other form of disposition or transfer of shares of the Company's stock or any legal or equitable interest therein; provided, however, that the term "transfer" does not include a transfer of such shares or interests by will or by the applicable laws of descent and distribution or a gift of such shares if the transferee or donee agrees to be bound by the provisions of this Section 5.8. (c) None of the shares of the Company's stock purchased on exercise of the Option shall be transferred on the Company's books nor shall the Company recognize any such transfer of any such shares or any interest therein unless and until all applicable provisions of this Section 5.8 have been compiled with in all respects. The certificates of stock evidencing shares of stock purchased on exercise of the Option shall bear an appropriate legend referring to the transfer restrictions imposed by this Section 5.8. 5.9. Lock-up in Event of Initial Public Offering - ---- ------------------------------------------- The Optionee agrees that, during a period of 180 days from the date of the Initial Public Offering, Optionee will not, without the prior written consent of the underwriter(s) of the Initial Public Offering, directly or indirectly, sell, offer to sell, grant any option for the sale of, or otherwise dispose of or transfer, any shares of Common Stock issuable upon exercise of the Option. 5.10 Dispute Resolution - ---- ------------------ Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved between the parties in a timely manner shall be resolved by binding arbitration before a single neutral arbitrator in San Diego, California. The arbitrator shall be selected from the American Arbitration Association through its procedures. All rules governing the arbitration shall be the rules as set forth by the American Arbitration Association. The arbitrator is bound to rule only on whether or not there has been a violation of the terms of this Agreement and to render an award, if any, that is consistent with the terms of this Agreement. Neither party to this Agreement is entitled to any legal recourse or rights or remedies other than those provided within this Agreement. Each party will bear one-half of the cost of the arbitration filing and hearing fees, and the cost of the arbitrator. Each party shall be responsible for its own attorneys' fees, unless otherwise decided by the arbitrator. IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties hereto. By: ______________________________ President By: ______________________________ Secretary _______________________________ Optionee _______________________________ _______________________________ Address Optionee's Taxpayer Identification Number: _______________________________ EX-10.35 40 1999 STOCK INCENTIVE PLAN EXHIBIT 10.35 COMPS.COM, INC. 1999 STOCK INCENTIVE PLAN ------------------------- ARTICLE ONE GENERAL PROVISIONS ------------------ I. PURPOSE OF THE PLAN This 1999 Stock Incentive Plan is intended to promote the interests of COMPS.COM, INC., a Delaware corporation, by providing eligible persons in the Corporation's service with the opportunity to acquire a proprietary interest, or otherwise increase their proprietary interest, in the Corporation as an incentive for them to remain in such service. Capitalized terms shall have the meanings assigned to such terms in the attached Appendix. II. STRUCTURE OF THE PLAN A. The Plan shall be divided into five separate equity programs: - the Discretionary Option Grant Program under which eligible persons may, at the discretion of the Plan Administrator, be granted options to purchase shares of Common Stock, - the Salary Investment Option Grant Program under which eligible employees may elect to have a portion of their base salary invested each year in special option grants, - the Stock Issuance Program under which eligible persons may, at the discretion of the Plan Administrator, be issued shares of Common Stock directly, either through the immediate purchase of such shares or as a bonus for services rendered the Corporation (or any Parent or Subsidiary), - the Automatic Option Grant Program under which eligible non- employee Board members shall automatically receive option grants at designated intervals over their period of continued Board service, and - the Director Fee Option Grant Program under which non- employee Board members may elect to have all or any portion of their annual retainer fee otherwise payable in cash applied to a special stock option grant. B. The provisions of Articles One and Seven shall apply to all equity programs under the Plan and shall govern the interests of all persons under the Plan. III. ADMINISTRATION OF THE PLAN A. The Primary Committee shall have sole and exclusive authority to administer the Discretionary Option Grant and Stock Issuance Programs with respect to Section 16 Insiders. Administration of the Discretionary Option Grant and Stock Issuance Programs with respect to all other persons eligible to participate in those programs may, at the Board's discretion, be vested in the Primary Committee or a Secondary Committee, or the Board may retain the power to administer those programs with respect to all such persons. However, any discretionary option grants or stock issuances for members of the Primary Committee shall be made by a disinterested majority of the Board. B. Members of the Primary Committee or any Secondary Committee shall serve for such period of time as the Board may determine and may be removed by the Board at any time. The Board may also at any time terminate the functions of any Secondary Committee and reassume all powers and authority previously delegated to such committee. C. Each Plan Administrator shall, within the scope of its administrative functions under the Plan, have full power and authority (subject to the provisions of the Plan) to establish such rules and regulations as it may deem appropriate for proper administration of the Discretionary Option Grant and Stock Issuance Programs and to make such determinations under, and issue such interpretations of, the provisions of those programs and any outstanding options or stock issuances thereunder as it may deem necessary or advisable. Decisions of the Plan Administrator within the scope of its administrative functions under the Plan shall be final and binding on all parties who have an interest in the Discretionary Option Grant and Stock Issuance Programs under its jurisdiction or any option or stock issuance thereunder. D. The Primary Committee shall have the sole and exclusive authority to determine which Section 16 Insiders and other highly compensated Employees shall be eligible for participation in the Salary Investment Option Grant Program for one or more calendar years. However, all option grants under the Salary Investment Option Grant Program shall be made in accordance with the express terms of that program, and the Primary Committee shall not exercise any discretionary functions with respect to the option grants made under that program. E. Service on the Primary Committee or the Secondary Committee shall constitute service as a Board member, and members of each such committee shall accordingly be entitled to full indemnification and reimbursement as Board members for their service on such committee. No member of the Primary Committee or the Secondary Committee shall be liable for any act or omission made in good faith with respect to the Plan or any option grants or stock issuances under the Plan. 2 F. Administration of the Automatic Option Grant and Director Fee Option Grant Programs shall be self-executing in accordance with the terms of those programs, and no Plan Administrator shall exercise any discretionary functions with respect to any option grants or stock issuances made under those programs. IV. ELIGIBILITY A. The persons eligible to participate in the Discretionary Option Grant and Stock Issuance Programs are as follows: (i) Employees, (ii) non-employee members of the Board or the board of directors of any Parent or Subsidiary, and (iii) consultants and other independent advisors who provide services to the Corporation (or any Parent or Subsidiary). B. Only Employees who are Section 16 Insiders or other highly compensated individuals shall be eligible to participate in the Salary Investment Option Grant Program. C. Each Plan Administrator shall, within the scope of its administrative jurisdiction under the Plan, have full authority to determine, (i) with respect to the option grants under the Discretionary Option Grant Program, which eligible persons are to receive such grants, the time or times when those grants are to be made, the number of shares to be covered by each such grant, the status of the granted option as either an Incentive Option or a Non-Statutory Option, the time or times when each option is to become exercisable, the vesting schedule (if any) applicable to the option shares and the maximum term for which the option is to remain outstanding and (ii) with respect to stock issuances under the Stock Issuance Program, which eligible persons are to receive such issuances, the time or times when the issuances are to be made, the number of shares to be issued to each Participant, the vesting schedule (if any) applicable to the issued shares and the consideration for such shares. D. The Plan Administrator shall have the absolute discretion either to grant options in accordance with the Discretionary Option Grant Program or to effect stock issuances in accordance with the Stock Issuance Program. E. The individuals who shall be eligible to participate in the Automatic Option Grant Program shall be limited to (i) those individuals who first become non-employee Board members on or after the Underwriting Date, whether through appointment by the Board or election by the Corporation's stockholders, and (ii) those individuals who continue to serve as non-employee Board members at one or more Annual Stockholders Meetings held after the Underwriting Date. A non-employee Board member who has previously been in the employ of the Corporation (or any Parent or Subsidiary) shall not be eligible to receive an option grant under the Automatic Option Grant Program at the time he or she first becomes a non-employee Board member, but shall be eligible to receive periodic option grants under the Automatic Option Grant Program while he or she continues to serve as a non-employee Board member. 3 F. All non-employee Board members shall be eligible to participate in the Director Fee Option Grant Program. V. STOCK SUBJECT TO THE PLAN A. The stock issuable under the Plan shall be shares of authorized but unissued or reacquired Common Stock, including shares repurchased by the Corporation on the open market. The number of shares of Common Stock initially reserved for issuance over the term of the Plan shall not exceed two million eight hundred thousand (2,800,000) shares. Such reserve shall consist of (i) the number of shares estimated to remain available for issuance, as of the Plan Effective Date, under the Predecessor Plans as last approved by the Corporation's stockholders, including the shares subject to outstanding options under those Predecessor Plans, (ii) plus an additional increase of approximately fifty one thousand four hundred seventeen (51,417) shares to be approved by the Corporation's stockholders prior to the Underwriting Date. B. The number of shares of Common Stock available for issuance under the Plan shall automatically increase on the first trading day in January each calendar year during the term of the Plan, beginning with calendar year 2000, by an amount equal to two and one half percent (2.5%) of the total number of shares of Common Stock outstanding on the last trading day in December of the immediately preceding calendar year, but in no event shall any such annual increase exceed five hundred thousand (500,000) shares. C. No one person participating in the Plan may receive options, separately exercisable stock appreciation rights and direct stock issuances for more than seven hundred thousand (700,000) shares of Common Stock in the aggregate per calendar year. D. Shares of Common Stock subject to outstanding options (including options incorporated into this Plan from the Predecessor Plans) shall be available for subsequent issuance under the Plan to the extent (i) those options expire or terminate for any reason prior to exercise in full or (ii) the options are cancelled in accordance with the cancellation-regrant provisions of Article Two. Unvested shares issued under the Plan and subsequently cancelled or repurchased by the Corporation at the original issue price paid per share, pursuant to the Corporation's repurchase rights under the Plan shall be added back to the number of shares of Common Stock reserved for issuance under the Plan and shall accordingly be available for reissuance through one or more subsequent option grants or direct stock issuances under the Plan. However, should the exercise price of an option under the Plan be paid with shares of Common Stock or should shares of Common Stock otherwise issuable under the Plan be withheld by the Corporation in satisfaction of the withholding taxes incurred in connection with the exercise of an option or the vesting of a stock issuance under the Plan, then the number of shares of Common Stock available for issuance under the Plan shall be reduced by the gross number of shares for which the option is exercised or which vest under the stock issuance, and not by the net number of shares of Common Stock issued to the holder of such option or stock issuance. Shares of Common Stock underlying one or more stock appreciation rights exercised under Section V of Article Two, Section III of Article Three, Section II of Article Five or Section III of Article Six of the Plan shall NOT be available for subsequent issuance under the Plan. 4 E. If any change is made to the Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without the Corporation's receipt of consideration, appropriate adjustments shall be made by the Plan Administrator to (i) the maximum number and/or class of securities issuable under the Plan, (ii) the number and/or class of securities for which any one person may be granted stock options, separately exercisable stock appreciation rights and direct stock issuances under the Plan per calendar year, (iii) the number and/or class of securities for which grants are subsequently to be made under the Automatic Option Grant Program to new and continuing non-employee Board members, (iv) the number and/or class of securities and the exercise price per share in effect under each outstanding option under the Plan, (v) the number and/or class of securities and price per share in effect under each outstanding option incorporated into this Plan from the Predecessor Plans and (vi) the maximum number and/or class of securities by which the share reserve is to increase automatically each calendar year pursuant to the provisions of Section V.B of this Article One. Such adjustments to the outstanding options are to be effected in a manner which shall preclude the enlargement or dilution of rights and benefits under such options. The adjustments determined by the Plan Administrator shall be final, binding and conclusive. 5 ARTICLE TWO DISCRETIONARY OPTION GRANT PROGRAM ---------------------------------- I. OPTION TERMS Each option shall be evidenced by one or more documents in the form approved by the Plan Administrator; provided, however, that each such document -------- shall comply with the terms specified below. Each document evidencing an Incentive Option shall, in addition, be subject to the provisions of the Plan applicable to such options. A. EXERCISE PRICE. --------------- 1. The exercise price per share shall be fixed by the Plan Administrator but shall not be less than one hundred percent (100%) of the Fair Market Value per share of Common Stock on the option grant date. (i) The exercise price shall become immediately due upon exercise of the option and shall, subject to the provisions of Section I of Article Seven and the documents evidencing the option, be payable in one or more of the forms specified below: (ii) cash or check made payable to the Corporation, (iii) shares of Common Stock held for the requisite period necessary to avoid a charge to the Corporation's earnings for financial reporting purposes and valued at Fair Market Value on the Exercise Date, or (iv) to the extent the option is exercised for vested shares, through a special sale and remittance procedure pursuant to which the Optionee shall concurrently provide irrevocable instructions to (a) a Corporation-designated brokerage firm to effect the immediate sale of the purchased shares and remit to the Corporation, out of the sale proceeds available on the settlement date, sufficient funds to cover the aggregate exercise price payable for the purchased shares plus all applicable Federal, state and local income and employment taxes required to be withheld by the Corporation by reason of such exercise and (b) the Corporation to deliver the certificates for the purchased shares directly to such brokerage firm in order to complete the sale. Except to the extent such sale and remittance procedure is utilized, payment of the exercise price for the purchased shares must be made on the Exercise Date. B. EXERCISE AND TERM OF OPTIONS. Each option shall be exercisable ---------------------------- at such time or times, during such period and for such number of shares as shall be determined by the Plan Administrator and set forth in the documents evidencing the option. However, no option shall have a term in excess of ten (10) years measured from the option grant date. 6 C. EFFECT OF TERMINATION OF SERVICE. --------------------------------- 1. The following provisions shall govern the exercise of any options held by the Optionee at the time of cessation of Service or death: (i) Any option outstanding at the time of the Optionee's cessation of Service for any reason shall remain exercisable for such period of time thereafter as shall be determined by the Plan Administrator and set forth in the documents evidencing the option, but no such option shall be exercisable after the expiration of the option term. (ii) Any option held by the Optionee at the time of death and exercisable in whole or in part at that time may be subsequently exercised by the personal representative of the Optionee's estate or by the person or persons to whom the option is transferred pursuant to the Optionee's will or in accordance with the laws of descent and distribution or by the Optionee's designated beneficiary or beneficiaries of that option. (iii) Should the Optionee's Service be terminated for Misconduct, then all outstanding options held by the Optionee shall terminate immediately and cease to be outstanding. (iv) During the applicable post-Service exercise period, the option may not be exercised in the aggregate for more than the number of vested shares for which the option is exercisable on the date of the Optionee's cessation of Service. Upon the expiration of the applicable exercise period or (if earlier) upon the expiration of the option term, the option shall terminate and cease to be outstanding for any vested shares for which the option has not been exercised. However, the option shall, immediately upon the Optionee's cessation of Service, terminate and cease to be outstanding to the extent the option is not otherwise at that time exercisable for vested shares. 2. The Plan Administrator shall have complete discretion, exercisable either at the time an option is granted or at any time while the option remains outstanding, to: (i) extend the period of time for which the option is to remain exercisable following the Optionee's cessation of Service from the limited exercise period otherwise in effect for that option to such greater period of time as the Plan Administrator shall deem appropriate, but in no event beyond the expiration of the option term, and/or (ii) permit the option to be exercised, during the applicable post-Service exercise period, no only with respect to the number of vested shares of Common Stock for which such option is exercisable at the time of the Optionee's cessation of Service but also with respect to one or more additional installments in which the Optionee would have vested had the Optionee continued in Service. 7 D. STOCKHOLDER RIGHTS. The holder of an option shall have no ------------------ stockholder rights with respect to the shares subject to the option until such person shall have exercised the option, paid the exercise price and become a holder of record of the purchased shares. E. REPURCHASE RIGHTS. The Plan Administrator shall have the ----------------- discretion to grant options which are exercisable for unvested shares of Common Stock. Should the Optionee cease Service while holding such unvested shares, the Corporation shall have the right to repurchase, at the exercise price paid per share, any or all of those unvested shares. The terms upon which such repurchase right shall be exercisable (including the period and procedure for exercise and the appropriate vesting schedule for the purchased shares) shall be established by the Plan Administrator and set forth in the document evidencing such repurchase right. F. LIMITED TRANSFERABILITY OF OPTIONS. During the lifetime of the ---------------------------------- Optionee, Incentive Options shall be exercisable only by the Optionee and shall not be assignable or transferable other than by will or by the laws of descent and distribution following the Optionee's death. However, a Non-Statutory Option may, in connection with the Optionee's estate plan, be assigned in whole or in part during the Optionee's lifetime to one or more members of the Optionee's immediate family or to a trust established exclusively for one or more such family members. The assigned portion may only be exercised by the person or persons who acquire a proprietary interest in the option pursuant to the assignment. The terms applicable to the assigned portion shall be the same as those in effect for the option immediately prior to such assignment and shall be set forth in such documents issued to the assignee as the Plan Administrator may deem appropriate. Notwithstanding the foregoing, the Optionee may also designate one or more persons as the beneficiary or beneficiaries of his or her outstanding options under this Article Two, and those options shall, in accordance with such designation, automatically be transferred to such beneficiary or beneficiaries upon the Optionee's death while holding those options. Such beneficiary or beneficiaries shall take the transferred options subject to all the terms and conditions of the applicable agreement evidencing each such transferred option, including (without limitation) the limited time period during which the option may be exercised following the Optionee's death. II. INCENTIVE OPTIONS The terms specified below shall be applicable to all Incentive Options. Except as modified by the provisions of this Section II, all the provisions of Articles One, Two and Seven shall be applicable to Incentive Options. Options which are specifically designated as Non-Statutory Options when issued under the Plan shall not be subject to the terms of this Section II. --- A. ELIGIBILITY. Incentive Options may only be granted to Employees. ----------- B. DOLLAR LIMITATION. The aggregate Fair Market Value of the shares ----------------- of Common Stock (determined as of the respective date or dates of grant) for which one or more options granted to any Employee under the Plan (or any other option plan of the Corporation or any Parent or Subsidiary) may for the first time become exercisable as Incentive Options during any one calendar year shall not exceed the sum of One Hundred Thousand Dollars ($100,000). 8 To the extent the Employee holds two (2) or more such options which become exercisable for the first time in the same calendar year, the foregoing limitation on the exercisability of such options as Incentive Options shall be applied on the basis of the order in which such options are granted. C. 10% STOCKHOLDER. If any Employee to whom an Incentive Option is --------------- granted is a 10% Stockholder, then the exercise price per share shall not be less than one hundred ten percent (110%) of the Fair Market Value per share of Common Stock on the option grant date, and the option term shall not exceed five (5) years measured from the option grant date. III. CORPORATE TRANSACTION/CHANGE IN CONTROL A. In the event of any Corporate Transaction, each outstanding option shall automatically accelerate so that each such option shall, immediately prior to the effective date of the Corporate Transaction, become fully exercisable for the total number of shares of Common Stock at the time subject to such option and may be exercised for any or all of those shares as fully vested shares of Common Stock. However, an outstanding option shall NOT become exercisable on such an accelerated basis if and to the extent: (i) such option is, in connection with the Corporate Transaction, to be assumed by the successor corporation (or parent thereof) or (ii) such option is to be replaced with a cash incentive program of the successor corporation which preserves the spread existing at the time of the Corporate Transaction on any shares for which the option is not otherwise at that time exercisable and provides for subsequent payout in accordance with the same exercise/vesting schedule applicable to those option shares or (iii) the acceleration of such option is subject to other limitations imposed by the Plan Administrator at the time of the option grant. B. All outstanding repurchase rights shall automatically terminate, and the shares of Common Stock subject to those terminated rights shall immediately vest in full, in the event of any Corporate Transaction, except to the extent: (i) those repurchase rights are to be assigned to the successor corporation (or parent thereof) in connection with such Corporate Transaction or (ii) such accelerated vesting is precluded by other limitations imposed by the Plan Administrator at the time the repurchase right is issued. C. Immediately following the consummation of the Corporate Transaction, all outstanding options shall terminate and cease to be outstanding, except to the extent assumed by the successor corporation (or parent thereof). D. Each option which is assumed in connection with a Corporate Transaction shall be appropriately adjusted, immediately after such Corporate Transaction, to apply to the number and class of securities which would have been issuable to the Optionee in consummation of such Corporate Transaction had the option been exercised immediately prior to such Corporate Transaction. Appropriate adjustments to reflect such Corporate Transaction shall also be made to (i) the exercise price payable per share under each outstanding option, provided the - -------- 9 aggregate exercise price payable for such securities shall remain the same, (ii) the maximum number and/or class of securities available for issuance over the remaining term of the Plan and (iii) the maximum number and/or class of securities for which any one person may be granted stock options, separately exercisable stock appreciation rights and direct stock issuances under the Plan per calendar year and (iv) the maximum number and/or class of securities by which the share reserve is to increase automatically each calendar year. E. The Plan Administrator shall have the discretionary authority to structure one or more outstanding options under the Discretionary Option Grant Program so that those options shall, immediately prior to the effect date of such Corporate Transaction, become fully exercisable for the total number of shares of Common Stock at the time subject to those options and may be exercised for any or all of those shares as fully vested shares of Common Stock, whether or not those options are to be assumed in the Corporate Transaction. In addition, the Plan Administrator shall have the discretionary authority to structure one or more of the Corporation's repurchase rights under the Discretionary Option Grant Program so that those rights shall not be assignable in connection with such Corporate Transaction and shall accordingly terminate upon the consummation of such Corporate Transaction, and the shares subject to those terminated rights shall thereupon vest in full. F. The Plan Administrator shall have full power and authority to structure one or more outstanding options under the Discretionary Option Grant Program so that those options shall become fully exercisable for the total number of shares of Common Stock at the time subject to those options in the event the Optionee's Service is subsequently terminated by reason of an Involuntary Termination within a designated period (not to exceed eighteen (18) months) following the effective date of any Corporate Transaction in which those options are assumed and do not otherwise accelerate. Any options so accelerated shall remain exercisable for fully vested shares until the earlier of (i) the ------- expiration of the option term or (ii) the expiration of the one (1) year period measured from the effective date of the Involuntary Termination. In addition, the Plan Administrator may structure one or more of the Corporation's repurchase rights so that those rights shall immediately terminate with respect to any shares held by the Optionee at the time of his or her Involuntary Termination, and the shares subject to those terminated repurchase rights shall accordingly vest in full at that time. G. The Plan Administrator shall have the discretionary authority to structure one or more outstanding options under the Discretionary Option Grant Program so that those options shall, immediately prior to the effect date of a Change in Control, become fully exercisable for the total number of shares of Common Stock at the time subject to those options and may be exercised for any or all of those shares as fully vested shares of Common Stock. In addition, the Plan Administrator shall have the discretionary authority to structure one or more of the Corporation's repurchase rights under the Discretionary Option Grant Program so that those rights shall terminate automatically upon the consummation of such Change in Control, and the shares subject to those terminated rights shall thereupon vest in full. Alternatively, the Plan Administrator may condition the automatic acceleration of one or more outstanding options under the Discretionary Option Grant Program and the termination of one or more of the Corporation's outstanding repurchase rights under such program upon the subsequent 10 termination of the Optionee's Service by reason of an Involuntary Termination within a designated period (not to exceed eighteen (18) months) following the effective date of such Change in Control. Each option so accelerated shall remain exercisable for fully vested shares until the earlier of (i) the ------- expiration of the option term or (ii) the expiration of the one (1) year period measured from the effective date of Optionee's cessation of Service. H. The portion of any Incentive Option accelerated in connection with a Corporate Transaction or Change in Control shall remain exercisable as an Incentive Option only to the extent the applicable One Hundred Thousand Dollar ($100,000) limitation is not exceeded. To the extent such dollar limitation is exceeded, the accelerated portion of such option shall be exercisable as a Nonstatutory Option under the Federal tax laws. I. The outstanding options shall in no way affect the right of the Corporation to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets. IV. CANCELLATION AND REGRANT OF OPTIONS The Plan Administrator shall have the authority to effect, at any time and from time to time, with the consent of the affected option holders, the cancellation of any or all outstanding options under the Discretionary Option Grant Program (including outstanding options incorporated from the Predecessor Plans) and to grant in substitution new options covering the same or different number of shares of Common Stock but with an exercise price per share based on the Fair Market Value per share of Common Stock on the new grant date. V. STOCK APPRECIATION RIGHTS A. The Plan Administrator shall have full power and authority to grant to selected Optionees tandem stock appreciation rights and/or limited stock appreciation rights. B. The following terms shall govern the grant and exercise of tandem stock appreciation rights: (i) One or more Optionees may be granted the right, exercisable upon such terms as the Plan Administrator may establish, to elect between the exercise of the underlying option for shares of Common Stock and the surrender of that option in exchange for a distribution from the Corporation in an amount equal to the excess of (a) the Fair Market Value (on the option surrender date) of the number of shares in which the Optionee is at the time vested under the surrendered option (or surrendered portion thereof) over (b) the aggregate exercise price payable for such shares. (ii) No such option surrender shall be effective unless it is approved by the Plan Administrator, either at the time of the actual option surrender or at any earlier time. If the surrender is so approved, then the distribution to which the Optionee shall be entitled may be made in shares of Common Stock valued at Fair Market Value on the option surrender date, in cash, or partly in shares and partly in cash, as the Plan Administrator shall in its sole discretion deem appropriate. 11 (iii) If the surrender of an option is not approved by the Plan Administrator, then the Optionee shall retain whatever rights the Optionee had under the surrendered option (or surrendered portion thereof) on the option surrender date and may exercise such rights at any time prior to the later of (a) five (5) business days after the receipt of the rejection ----- notice or (b) the last day on which the option is otherwise exercisable in accordance with the terms of the documents evidencing such option, but in no event may such rights be exercised more than ten (10) years after the option grant date. C. The following terms shall govern the grant and exercise of limited stock appreciation rights: (i) One or more Section 16 Insiders may be granted limited stock appreciation rights with respect to their outstanding options. (ii) Upon the occurrence of a Hostile Take-Over, each individual holding one or more options with such a limited stock appreciation right shall have the unconditional right (exercisable for a thirty (30)-day period following such Hostile Take-Over) to surrender each such option to the Corporation. In return for the surrendered option, the Optionee shall receive a cash distribution from the Corporation in an amount equal to the excess of (A) the Take-Over Price of the shares of Common Stock at the time subject to such option (whether or not the Optionee is otherwise vested in those shares) over (B) the aggregate exercise price payable for those shares. Such cash distribution shall be paid within five (5) days following the option surrender date. (iii) At the time such limited stock appreciation right is granted, the Plan Administrator shall pre-approve any subsequent exercise of that right in accordance with the terms of this Paragraph C. Accordingly, no further approval of the Plan Administrator or the Board shall be required at the time of the actual option surrender and cash distribution. 12 ARTICLE THREE SALARY INVESTMENT OPTION GRANT PROGRAM -------------------------------------- I. OPTION GRANTS The Primary Committee shall have the sole and exclusive authority to determine the calendar year or years (if any) for which the Salary Investment Option Grant Program is to be in effect and to select the Section 16 Insiders and other highly compensated Employees eligible to participate in the Salary Investment Option Grant Program for such calendar year or years. Each selected individual who elects to participate in the Salary Investment Option Grant Program must, prior to the start of each calendar year of participation, file with the Plan Administrator (or its designate) an irrevocable authorization directing the Corporation to reduce his or her base salary for that calendar year by an amount not less than Ten Thousand Dollars ($10,000.00) nor more than Fifty Thousand Dollars ($50,000.00). Each individual who files such a timely authorization shall automatically be granted an option under the Salary Investment Grant Program on the first trading day in January of the calendar year for which the salary reduction is to be in effect. II. OPTION TERMS Each option shall be a Non-Statutory Option evidenced by one or more documents in the form approved by the Plan Administrator; provided, however, -------- that each such document shall comply with the terms specified below. A. EXERCISE PRICE. --------------- 1. The exercise price per share shall be thirty-three and one- third percent (33-1/3%) of the Fair Market Value per share of Common Stock on the option grant date. 2. The exercise price shall become immediately due upon exercise of the option and shall be payable in one or more of the alternative forms authorized under the Discretionary Option Grant Program. Except to the extent the sale and remittance procedure specified thereunder is utilized, payment of the exercise price for the purchased shares must be made on the Exercise Date. B. NUMBER OF OPTION SHARES. The number of shares of Common Stock ----------------------- subject to the option shall be determined pursuant to the following formula (rounded down to the nearest whole number): X = A / (B x 66-2/3%), where X is the number of option shares, 13 A is the dollar amount of the reduction in the Optionee's base salary for the calendar year to be in effect pursuant to this program, and B is the Fair Market Value per share of Common Stock on the option grant date. C. EXERCISE AND TERM OF OPTIONS. The option shall become ---------------------------- exercisable in a series of twelve (12) successive equal monthly installments upon the Optionee's completion of each calendar month of Service in the calendar year for which the salary reduction is in effect. Each option shall have a maximum term of ten (10) years measured from the option grant date. D. EFFECT OF TERMINATION OF SERVICE. Should the Optionee cease -------------------------------- Service for any reason while holding one or more options under this Article Three, then each such option shall remain exercisable, for any or all of the shares for which the option is exercisable at the time of such cessation of Service, until the earlier of (i) the expiration of the ten (10)-year option ------- term or (ii) the expiration of the three (3)-year period measured from the date of such cessation of Service. Should the Optionee die while holding one or more options under this Article Three, then each such option may be exercised, for any or all of the shares for which the option is exercisable at the time of the Optionee's cessation of Service (less any shares subsequently purchased by Optionee prior to death), by the personal representative of the Optionee's estate or by the person or persons to whom the option is transferred pursuant to the Optionee's will or in accordance with the laws of descent and distribution or by the designated beneficiary or beneficiaries of such option. Such right of exercise shall lapse, and the option shall terminate, upon the earlier of (i) ------- the expiration of the ten (10)-year option term or (ii) the three (3)-year period measured from the date of the Optionee's cessation of Service. However, the option shall, immediately upon the Optionee's cessation of Service for any reason, terminate and cease to remain outstanding with respect to any and all shares of Common Stock for which the option is not otherwise at that time exercisable. III. CORPORATE TRANSACTION/ CHANGE IN CONTROL/ HOSTILE TAKE-OVER A. In the event of any Corporate Transaction while the Optionee remains in Service, each outstanding option held by such Optionee under this Salary Investment Option Grant Program shall automatically accelerate so that each such option shall, immediately prior to the effective date of the Corporate Transaction, become fully exercisable for the total number of shares of Common Stock at the time subject to such option and may be exercised for any or all of those shares as fully-vested shares of Common Stock. Each such outstanding option shall terminate immediately following the Corporate Transaction, except to the extent assumed by the successor corporation (or parent thereof) in such Corporate Transaction. Any option so assumed and shall remain exercisable for the fully-vested shares until the earlier of (i) the expiration of the ten (10)- ------- year option term or (ii) the expiration of the three (3)-year period measured from the date of the Optionee's cessation of Service. 14 B. In the event of a Change in Control while the Optionee remains in Service, each outstanding option held by such Optionee under this Salary Investment Option Grant Program shall automatically accelerate so that each such option shall immediately become fully exercisable for the total number of shares of Common Stock at the time subject to such option and may be exercised for any or all of those shares as fully-vested shares of Common Stock. The option shall remain so exercisable until the earliest to occur of (i) the expiration of the -------- ten (10)-year option term, (ii) the expiration of the three (3)-year period measured from the date of the Optionee's cessation of Service, (iii) the termination of the option in connection with a Corporate Transaction or (iv) the surrender of the option in connection with a Hostile Take-Over. C. Upon the occurrence of a Hostile Take-Over, the Optionee shall have a thirty (30)-day period in which to surrender to the Corporation each outstanding option granted him or her under the Salary Investment Option Grant Program. The Optionee shall in return be entitled to a cash distribution from the Corporation in an amount equal to the excess of (i) the Take-Over Price of the shares of Common Stock at the time subject to the surrendered option (whether or not the Optionee is otherwise at the time vested in those shares) over (ii) the aggregate exercise price payable for such shares. Such cash distribution shall be paid within five (5) days following the surrender of the option to the Corporation. The Primary Committee shall, at the time the option with such limited stock appreciation right is granted under the Salary Investment Option Grant Program, pre-approve any subsequent exercise of that right in accordance with the terms of this Paragraph C. Accordingly, no further approval of the Primary Committee or the Board shall be required at the time of the actual option surrender and cash distribution. D. Each option which is assumed in connection with a Corporate Transaction shall be appropriately adjusted, immediately after such Corporate Transaction, to apply to the number and class of securities which would have been issuable to the Optionee in consummation of such Corporate Transaction had the option been exercised immediately prior to such Corporate Transaction. Appropriate adjustments shall also be made to the exercise price payable per share under each outstanding option, provided the aggregate exercise price -------- payable for such securities shall remain the same. E. The grant of options under the Salary Investment Option Grant Program shall in no way affect the right of the Corporation to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets. IV. REMAINING TERMS The remaining terms of each option granted under the Salary Investment Option Grant Program shall be the same as the terms in effect for option grants made under the Discretionary Option Grant Program. 15 ARTICLE FOUR STOCK ISSUANCE PROGRAM ---------------------- I. STOCK ISSUANCE TERMS Shares of Common Stock may be issued under the Stock Issuance Program through direct and immediate issuances without any intervening option grants. Each such stock issuance shall be evidenced by a Stock Issuance Agreement which complies with the terms specified below. Shares of Common Stock may also be issued under the Stock Issuance Program pursuant to share right awards which entitle the recipients to receive those shares upon the attainment of designated performance goals. A. PURCHASE PRICE. --------------- 1. The purchase price per share shall be fixed by the Plan Administrator, but shall not be less than one hundred percent (100%) of the Fair Market Value per share of Common Stock on the issuance date. 2. Subject to the provisions of Section I of Article Seven, shares of Common Stock may be issued under the Stock Issuance Program for any of the following items of consideration which the Plan Administrator may deem appropriate in each individual instance: (i) cash or check made payable to the Corporation, or (ii) past services rendered to the Corporation (or any Parent or Subsidiary). B. VESTING PROVISIONS. ------------------- 1. Shares of Common Stock issued under the Stock Issuance Program may, in the discretion of the Plan Administrator, be fully and immediately vested upon issuance or may vest in one or more installments over the Participant's period of Service or upon attainment of specified performance objectives. The elements of the vesting schedule applicable to any unvested shares of Common Stock issued under the Stock Issuance Program shall be determined by the Plan Administrator and incorporated into the Stock Issuance Agreement. Shares of Common Stock may also be issued under the Stock Issuance Program pursuant to share right awards which entitle the recipients to receive those shares upon the attainment of designated performance goals. 2. Any new, substituted or additional securities or other property (including money paid other than as a regular cash dividend) which the Participant may have the right to receive with respect to the Participant's unvested shares of Common Stock by reason of any stock dividend, stock split, recapitalization, combination of shares, exchange of shares or 16 other change affecting the outstanding Common Stock as a class without the Corporation's receipt of consideration shall be issued subject to (i) the same vesting requirements applicable to the Participant's unvested shares of Common Stock and (ii) such escrow arrangements as the Plan Administrator shall deem appropriate. 3. The Participant shall have full stockholder rights with respect to any shares of Common Stock issued to the Participant under the Stock Issuance Program, whether or not the Participant's interest in those shares is vested. Accordingly, the Participant shall have the right to vote such shares and to receive any regular cash dividends paid on such shares. 4. Should the Participant cease to remain in Service while holding one or more unvested shares of Common Stock issued under the Stock Issuance Program or should the performance objectives not be attained with respect to one or more such unvested shares of Common Stock, then those shares shall be immediately surrendered to the Corporation for cancellation, and the Participant shall have no further stockholder rights with respect to those shares. To the extent the surrendered shares were previously issued to the Participant for consideration paid in cash or cash equivalent (including the Participant's purchase-money indebtedness), the Corporation shall repay to the Participant the cash consideration paid for the surrendered shares and shall cancel the unpaid principal balance of any outstanding purchase-money note of the Participant attributable to the surrendered shares. 5. The Plan Administrator may in its discretion waive the surrender and cancellation of one or more unvested shares of Common Stock which would otherwise occur upon the cessation of the Participant's Service or the non-attainment of the performance objectives applicable to those shares. Such waiver shall result in the immediate vesting of the Participant's interest in the shares of Common Stock as to which the waiver applies. Such waiver may be effected at any time, whether before or after the Participant's cessation of Service or the attainment or non-attainment of the applicable performance objectives. 6. Outstanding share right awards under the Stock Issuance Program shall automatically terminate, and no shares of Common Stock shall actually be issued in satisfaction of those awards, if the performance goals established for such awards are not attained. The Plan Administrator, however, shall have the discretionary authority to issue shares of Common Stock under one or more outstanding share right awards as to which the designated performance goals have not been attained. II. CORPORATE TRANSACTION/CHANGE IN CONTROL A. All of the Corporation's outstanding repurchase rights under the Stock Issuance Program shall terminate automatically, and all the shares of Common Stock subject to those terminated rights shall immediately vest in full, in the event of any Corporate Transaction, except to the extent (i) those repurchase rights are to be assigned to the successor corporation (or parent thereof) in connection with such Corporate Transaction or (ii) such accelerated vesting is precluded by other limitations imposed in the Stock Issuance Agreement. 17 B. The Plan Administrator shall have the discretionary authority to structure one or more of the Corporation's repurchase rights under the Stock Issuance Program so that those rights shall automatically terminate in whole or in part, and the shares of Common Stock subject to those terminated rights shall immediately vest, in the event the Participant's Service should subsequently terminate by reason of an Involuntary Termination within a designated period (not to exceed eighteen (18) months) following the effective date of any Corporate Transaction in which those repurchase rights are assigned to the successor corporation (or parent thereof). C. The Plan Administrator shall also have the discretionary authority to structure one or more of the Corporation's repurchase rights under the Stock Issuance Program so that those rights shall automatically terminate in whole or in part, and the shares of Common Stock subject to those terminated rights shall immediately vest, in the event the Participant's Service should subsequently terminate by reason of an Involuntary Termination within a designated period (not to exceed eighteen (18) months) following the effective date of any Change in Control. III. SHARE ESCROW/LEGENDS Unvested shares may, in the Plan Administrator's discretion, be held in escrow by the Corporation until the Participant's interest in such shares vests or may be issued directly to the Participant with restrictive legends on the certificates evidencing those unvested shares. 18 ARTICLE FIVE AUTOMATIC OPTION GRANT PROGRAM ------------------------------ I. OPTION TERMS A. GRANT DATES. Option grants shall be made on the dates specified ----------- below: 1. Each individual who is first elected or appointed as a non- employee Board member at any time on or after the Underwriting Date shall automatically be granted, on the date of such initial election or appointment, a Non-Statutory Option to purchase twelve thousand (12,000) shares of Common Stock, provided that individual has not previously been in the employ of the Corporation or any Parent or Subsidiary. 2. On the date of each Annual Stockholders Meeting held after the Underwriting Date, each individual who is to continue to serve as an Eligible Director, whether or not that individual is standing for re-election to the Board at that particular Annual Meeting, shall automatically be granted a Non-Statutory Option to purchase two thousand (2,000) shares of Common Stock, provided such individual has served as a non-employee Board member for at least six (6) months. There shall be no limit on the number of such two thousand (2,000) share option grants any one Eligible Director may receive over his or her period of Board service, and non-employee Board members who have previously been in the employ of the Corporation (or any Parent or Subsidiary) or who have otherwise received one or more stock option grants from the Corporation prior to the Underwriting Date shall be eligible to receive one or more such annual option grants over their period of continued Board service. B. EXERCISE PRICE. --------------- 1. The exercise price per share shall be equal to one hundred percent (100%) of the Fair Market Value per share of Common Stock on the option grant date. 2. The exercise price shall be payable in one or more of the alternative forms authorized under the Discretionary Option Grant Program. Except to the extent the sale and remittance procedure specified thereunder is utilized, payment of the exercise price for the purchased shares must be made on the Exercise Date. C. OPTION TERM. Each option shall have a term of ten (10) years ----------- measured from the option grant date. D. EXERCISE AND VESTING OF OPTIONS. Each option shall be ------------------------------- immediately exercisable for any or all of the option shares. However, any shares purchased under the option shall be subject to repurchase by the Corporation, at the exercise price paid per share, upon the Optionee's cessation of Board service prior to vesting in those shares. Each initial twelve thousand (12,000) share grant shall vest, and the Corporation's repurchase right shall lapse, in a series of eight (8) successive equal semi-annual installments upon the Optionee's completion of each six (6)-month period of service as a Board member over the forty-eight (48)-month period 19 measured from the option grant date. Each annual two thousand (2,000) share automatic option shall vest, and the Corporation's repurchase right shall lapse, in two (2) successive equal semi-annual installments upon the Optionee's completion of each six (6)-month period of Board service measured from the option grant date. E. LIMITED TRANSFERABILITY OF OPTIONS. Each option under this ---------------------------------- Article Five may, in connection with the Optionee's estate plan, be assigned in whole or in part during the Optionee's lifetime to one or more members of the Optionee's immediate family or to a trust established exclusively for one or more such family members. The assigned portion may only be exercised by the person or persons who acquire a proprietary interest in the option pursuant to the assignment. The terms applicable to the assigned portion shall be the same as those in effect for the option immediately prior to such assignment and shall be set forth in such documents issued to the assignee as the Plan Administrator may deem appropriate. The Optionee may also designate one or more persons as the beneficiary or beneficiaries of his or her outstanding options under this Article Three, and those options shall, in accordance with such designation, automatically be transferred to such beneficiary or beneficiaries upon the Optionee's death while holding those options. Such beneficiary or beneficiaries shall take the transferred options subject to all the terms and conditions of the applicable agreement evidencing each such transferred option, including (without limitation) the limited time period during which the option may be exercised following the Optionee's death. F. TERMINATION OF BOARD SERVICE. The following provisions shall ---------------------------- govern the exercise of any options held by the Optionee at the time the Optionee ceases to serve as a Board member: (i) The Optionee (or, in the event of Optionee's death, the personal representative of the Optionee's estate or the person or persons to whom the option is transferred pursuant to the Optionee's will or in accordance with the laws of descent and distribution or by the designated beneficiary or beneficiaries of such option) shall have a twelve (12)-month period following the date of such cessation of Board service in which to exercise each such option. (ii) During the twelve (12)-month exercise period, the option may not be exercised in the aggregate for more than the number of vested shares of Common Stock for which the option is exercisable at the time of the Optionee's cessation of Board service. (iii) Should the Optionee cease to serve as a Board member by reason of death or Permanent Disability, then all shares at the time subject to the option shall immediately vest so that such option may, during the twelve (12)-month exercise period following such cessation of Board service, be exercised for all or any portion of those shares as fully-vested shares of Common Stock. 20 (iv) In no event shall the option remain exercisable after the expiration of the option term. Upon the expiration of the twelve (12)- month exercise period or (if earlier) upon the expiration of the option term, the option shall terminate and cease to be outstanding for any vested shares for which the option has not been exercised. However, the option shall, immediately upon the Optionee's cessation of Board service for any reason other than death or Permanent Disability, terminate and cease to be outstanding to the extent the option is not otherwise at that time exercisable for vested shares. II. CORPORATE TRANSACTION/ CHANGE IN CONTROL/ HOSTILE TAKE-OVER A. In the event of any Corporate Transaction, the shares of Common Stock at the time subject to each outstanding option but not otherwise vested shall automatically vest in full so that each such option shall, immediately prior to the effective date of the Corporate Transaction, become fully exercisable for all of the shares of Common Stock at the time subject to such option and may be exercised for all or any portion of those shares as fully- vested shares of Common Stock. Immediately following the consummation of the Corporate Transaction, each automatic option grant shall terminate and cease to be outstanding, except to the extent assumed by the successor corporation (or parent thereof). B. In connection with any Change in Control, the shares of Common Stock at the time subject to each outstanding option but not otherwise vested shall automatically vest in full so that each such option shall, immediately prior to the effective date of the Change in Control, become fully exercisable for all of the shares of Common Stock at the time subject to such option and may be exercised for all or any portion of those shares as fully-vested shares of Common Stock. Each such option shall remain exercisable for such fully-vested option shares until the expiration or sooner termination of the option term or the surrender of the option in connection with a Hostile Take-Over. C. All outstanding repurchase rights shall automatically terminate, and the shares of Common Stock subject to those terminated rights shall immediately vest in full, in the event of any Corporate Transaction or Change in Control. D. Upon the occurrence of a Hostile Take-Over, the Optionee shall have a thirty (30)-day period in which to surrender to the Corporation each of his or her outstanding automatic option grants. The Optionee shall in return be entitled to a cash distribution from the Corporation in an amount equal to the excess of (i) the Take-Over Price of the shares of Common Stock at the time subject to each surrendered option (whether or not the Optionee is otherwise at the time vested in those shares) over (ii) the aggregate exercise price payable for such shares. Such cash distribution shall be paid within five (5) days following the surrender of the option to the Corporation. Stockholder approval of the Plan shall constitute pre-approval of the grant of each such limited cash-out right and the subsequent exercise of that right in accordance with the terms of this Paragraph D. Accordingly, no approval or consent of the Board or any Plan Administrator shall be required at the time of the actual option surrender and cash distribution. 21 E. Each option which is assumed in connection with a Corporate Transaction shall be appropriately adjusted, immediately after such Corporate Transaction, to apply to the number and class of securities which would have been issuable to the Optionee in consummation of such Corporate Transaction had the option been exercised immediately prior to such Corporate Transaction. Appropriate adjustments shall also be made to the exercise price payable per share under each outstanding option, provided the aggregate exercise price -------- payable for such securities shall remain the same. F. The grant of options under the Automatic Option Grant Program shall in no way affect the right of the Corporation to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets. III. REMAINING TERMS The remaining terms of each option granted under the Automatic Option Grant Program shall be the same as the terms in effect for option grants made under the Discretionary Option Grant Program. 22 ARTICLE SIX DIRECTOR FEE OPTION GRANT PROGRAM --------------------------------- I. OPTION GRANTS The Primary Committee shall have the sole and exclusive authority to determine the calendar year or years for which the Director Fee Option Grant Program is to be in effect. For each such calendar year the program is in effect, each non-employee Board member may elect to apply all or any portion of the annual retainer fee otherwise payable in cash for his or her service on the Board for that year to the acquisition of a special option grant under this Director Fee Option Grant Program. Such election must be filed with the Corporation's Chief Financial Officer prior to first day of the calendar year for which the annual retainer fee which is the subject of that election is otherwise payable. Each non-employee Board member who files such a timely election shall automatically be granted an option under this Director Fee Option Grant Program on the first trading day in January in the calendar year for which the annual retainer fee which is the subject of that election would otherwise be payable in cash. II. OPTION TERMS Each option shall be a Non-Statutory Option governed by the terms and conditions specified below. A. EXERCISE PRICE. --------------- 1. The exercise price per share shall be thirty-three and one- third percent (33-1/3%) of the Fair Market Value per share of Common Stock on the option grant date. 2. The exercise price shall become immediately due upon exercise of the option and shall be payable in one or more of the alternative forms authorized under the Discretionary Option Grant Program. Except to the extent the sale and remittance procedure specified thereunder is utilized, payment of the exercise price for the purchased shares must be made on the Exercise Date. B. NUMBER OF OPTION SHARES. The number of shares of Common Stock ----------------------- subject to the option shall be determined pursuant to the following formula (rounded down to the nearest whole number): X = A / (B x 66-2/3%), where X is the number of option shares, 23 A is the portion of the annual retainer fee subject to the non- employee Board member's election, and B is the Fair Market Value per share of Common Stock on the option grant date. C. EXERCISE AND TERM OF OPTIONS. The option shall become ---------------------------- exercisable in a series of twelve (12) equal monthly installments upon the Optionee's completion of each month of Board service over the twelve (12)-month period measured from the grant date. Each option shall have a maximum term of ten (10) years measured from the option grant date. D. LIMITED TRANSFERABILITY OF OPTIONS. Each option under this ---------------------------------- Article Six may, in connection with the Optionee's estate plan, be assigned in whole or in part during the Optionee's lifetime to one or more members of the Optionee's immediate family or to a trust established exclusively for one or more such family members. The assigned portion may only be exercised by the person or persons who acquire a proprietary interest in the option pursuant to the assignment. The terms applicable to the assigned portion shall be the same as those in effect for the option immediately prior to such assignment and shall be set forth in such documents issued to the assignee as the Plan Administrator may deem appropriate. The Optionee may also designate one or more persons as the beneficiary or beneficiaries of his or her outstanding options under this Article Three, and those options shall, in accordance with such designation, automatically be transferred to such beneficiary or beneficiaries upon the Optionee's death while holding those options. Such beneficiary or beneficiaries shall take the transferred options subject to all the terms and conditions of the applicable agreement evidencing each such transferred option, including (without limitation) the limited time period during which the option may be exercised following the Optionee's death. E. TERMINATION OF BOARD SERVICE. Should the Optionee cease Board ---------------------------- service for any reason (other than death or Permanent Disability) while holding one or more options under this Director Fee Option Grant Program, then each such option shall remain exercisable, for any or all of the shares for which the option is exercisable at the time of such cessation of Board service, until the earlier of (i) the expiration of the ten (10)-year option term or (ii) the - ------- expiration of the three (3)-year period measured from the date of such cessation of Board service. However, each option held by the Optionee under this Director Fee Option Grant Program at the time of his or her cessation of Board service shall immediately terminate and cease to remain outstanding with respect to any and all shares of Common Stock for which the option is not otherwise at that time exercisable. F. DEATH OR PERMANENT DISABILITY. Should the Optionee's service as ----------------------------- a Board member cease by reason of death or Permanent Disability, then each option held by such Optionee under this Director Fee Option Grant Program shall immediately become exercisable for all the shares of Common Stock at the time subject to that option, and the option may be exercised for any or all of those shares as fully-vested shares until the earlier of (i) the expiration of the ten ------- (10)-year option term or (ii) the expiration of the three (3)-year period measured from the date of such cessation of Board service. 24 Should the Optionee die after cessation of Board service but while holding one or more options under this Director Fee Option Grant Program, then each such option may be exercised, for any or all of the shares for which the option is exercisable at the time of the Optionee's cessation of Board service (less any shares subsequently purchased by Optionee prior to death), by the personal representative of the Optionee's estate or by the person or persons to whom the option is transferred pursuant to the Optionee's will or in accordance with the laws of descent and distribution or by the designated beneficiary or beneficiaries of such option. Such right of exercise shall lapse, and the option shall terminate, upon the earlier of (i) the expiration of the ten (10)- ------- year option term or (ii) the three (3)-year period measured from the date of the Optionee's cessation of Board service. III. CORPORATE TRANSACTION/CHANGE IN CONTROL/HOSTILE TAKE-OVER A. In the event of any Corporate Transaction while the Optionee remains a Board member, each outstanding option held by such Optionee under this Director Fee Option Grant Program shall automatically accelerate so that each such option shall, immediately prior to the effective date of the Corporate Transaction, become fully exercisable for the total number of shares of Common Stock at the time subject to such option and may be exercised for any or all of those shares as fully-vested shares of Common Stock. Each such outstanding option shall terminate immediately following the Corporate Transaction, except to the extent assumed by the successor corporation (or parent thereof) in such Corporate Transaction. Any option so assumed and shall remain exercisable for the fully-vested shares until the earlier of (i) the expiration of the ten (10)- ------- year option term or (ii) the expiration of the three (3)-year period measured from the date of the Optionee's cessation of Board service. B. In the event of a Change in Control while the Optionee remains in Service, each outstanding option held by such Optionee under this Director Fee Option Grant Program shall automatically accelerate so that each such option shall immediately become fully exercisable for the total number of shares of Common Stock at the time subject to such option and may be exercised for any or all of those shares as fully-vested shares of Common Stock. The option shall remain so exercisable until the earliest to occur of (i) the expiration of the -------- ten (10)-year option term, (ii) the expiration of the three (3)-year period measured from the date of the Optionee's cessation of Board service, (iii) the termination of the option in connection with a Corporate Transaction or (iv) the surrender of the option in connection with a Hostile Take-Over. C. Upon the occurrence of a Hostile Take-Over, the Optionee shall have a thirty (30)-day period in which to surrender to the Corporation each outstanding option granted him or her under the Director Fee Option Grant Program. The Optionee shall in return be entitled to a cash distribution from the Corporation in an amount equal to the excess of (i) the Take-Over Price of the shares of Common Stock at the time subject to each surrendered option (whether or not the Optionee is otherwise at the time vested in those shares) over (ii) the aggregate exercise price payable for such shares. Such cash distribution shall be paid within five 25 (5) days following the surrender of the option to the Corporation. Stockholder approval of the Plan shall constitute pre-approval of the grant of each such limited cash-out right and the subsequent exercise of that right in accordance with the terms of this Paragraph C. Accordingly, no approval or consent of the Board or any Plan Administrator shall be required at the time of the actual option surrender and cash distribution. D. The grant of options under the Director Fee Option Grant Program shall in no way affect the right of the Corporation to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets. IV. REMAINING TERMS The remaining terms of each option granted under this Director Fee Option Grant Program shall be the same as the terms in effect for option grants made under the Discretionary Option Grant Program. 26 ARTICLE SEVEN MISCELLANEOUS ------------- I. FINANCING The Plan Administrator may permit any Optionee or Participant to pay the option exercise price under the Discretionary Option Grant Program or the purchase price of shares issued under the Stock Issuance Program by delivering a full-recourse, interest bearing promissory note payable in one or more installments. The terms of any such promissory note (including the interest rate and the terms of repayment) shall be established by the Plan Administrator in its sole discretion. In no event may the maximum credit available to the Optionee or Participant exceed the sum of (i) the aggregate option exercise price or purchase price payable for the purchased shares plus (ii) any Federal, state and local income and employment tax liability incurred by the Optionee or the Participant in connection with the option exercise or share purchase. II. TAX WITHHOLDING A. The Corporation's obligation to deliver shares of Common Stock upon the exercise of options or the issuance or vesting of such shares under the Plan shall be subject to the satisfaction of all applicable Federal, state and local income and employment tax withholding requirements. B. The Plan Administrator may, in its discretion, provide any or all holders of Non-Statutory Options or unvested shares of Common Stock under the Plan (other than the options granted or the shares issued under the Automatic Option Grant or Director Fee Option Grant Program) with the right to use shares of Common Stock in satisfaction of all or part of the Taxes incurred by such holders in connection with the exercise of their options or the vesting of their shares. Such right may be provided to any such holder in either or both of the following formats: Stock Withholding: The election to have the Corporation ----------------- withhold, from the shares of Common Stock otherwise issuable upon the exercise of such Non-Statutory Option or the vesting of such shares, a portion of those shares with an aggregate Fair Market Value equal to the percentage of the Taxes (not to exceed one hundred percent (100%)) designated by the holder. Stock Delivery: The election to deliver to the Corporation, at -------------- the time the Non-Statutory Option is exercised or the shares vest, one or more shares of Common Stock previously acquired by such holder (other than in connection with the option exercise or share vesting triggering the Taxes) with an aggregate Fair Market Value equal to the percentage of the Taxes (not to exceed one hundred percent (100%)) designated by the holder. 27 III. EFFECTIVE DATE AND TERM OF THE PLAN A. The Plan shall become effective immediately on the Plan Effective Date. However, the Salary Investment Option Grant Program and the Director Fee Option Grant Program shall not be implemented until such time as the Primary Committee may deem appropriate. Options may be granted under the Discretionary Option Grant at any time on or after the Plan Effective Date. However, no options granted under the Plan may be exercised, and no shares shall be issued under the Plan, until the Plan is approved by the Corporation's stockholders. If such stockholder approval is not obtained within twelve (12) months after the Plan Effective Date, then all options previously granted under this Plan shall terminate and cease to be outstanding, and no further options shall be granted and no shares shall be issued under the Plan. B. The Plan shall serve as the successor to the Predecessor Plans, and no further option grants or direct stock issuances shall be made under the Predecessor Plans after the Plan Effective Date. All options outstanding under the Predecessor Plans on the Plan Effective Date shall be incorporated into the Plan at that time and shall be treated as outstanding options under the Plan. However, each outstanding option so incorporated shall continue to be governed solely by the terms of the documents evidencing such option, and no provision of the Plan shall be deemed to affect or otherwise modify the rights or obligations of the holders of such incorporated options with respect to their acquisition of shares of Common Stock. C. One or more provisions of the Plan, including (without limitation) the option/vesting acceleration provisions of Article Two relating to Corporate Transactions and Changes in Control, may, in the Plan Administrator's discretion, be extended to one or more options incorporated from the Predecessor Plans which do not otherwise contain such provisions. D. The Plan shall terminate upon the earliest to occur of (i) -------- February 18, 2009, (ii) the date on which all shares available for issuance under the Plan shall have been issued as fully-vested shares or (iii) the termination of all outstanding options in connection with a Corporate Transaction. Should the Plan terminate on February 18, 2009, then all option grants and unvested stock issuances outstanding at that time shall continue to have force and effect in accordance with the provisions of the documents evidencing such grants or issuances. IV. AMENDMENT OF THE PLAN A. The Board shall have complete and exclusive power and authority to amend or modify the Plan in any or all respects. However, no such amendment or modification shall adversely affect the rights and obligations with respect to stock options or unvested stock issuances at the time outstanding under the Plan unless the Optionee or the Participant consents to such amendment or modification. In addition, certain amendments may require stockholder approval pursuant to applicable laws or regulations. B. Options to purchase shares of Common Stock may be granted under the Discretionary Option Grant and Salary Investment Option Grant Programs and shares of Common Stock may be issued under the Stock Issuance Program that are in each instance in excess of the number of shares then available for issuance under the Plan, provided any excess 28 shares actually issued under those programs shall be held in escrow until there is obtained stockholder approval of an amendment sufficiently increasing the number of shares of Common Stock available for issuance under the Plan. If such stockholder approval is not obtained within twelve (12) months after the date the first such excess issuances are made, then (i) any unexercised options granted on the basis of such excess shares shall terminate and cease to be outstanding and (ii) the Corporation shall promptly refund to the Optionees and the Participants the exercise or purchase price paid for any excess shares issued under the Plan and held in escrow, together with interest (at the applicable Short Term Federal Rate) for the period the shares were held in escrow, and such shares shall thereupon be automatically cancelled and cease to be outstanding. V. USE OF PROCEEDS Any cash proceeds received by the Corporation from the sale of shares of Common Stock under the Plan shall be used for general corporate purposes. VI. REGULATORY APPROVALS A. The implementation of the Plan, the granting of any stock option under the Plan and the issuance of any shares of Common Stock (i) upon the exercise of any granted option or (ii) under the Stock Issuance Program shall be subject to the Corporation's procurement of all approvals and permits required by regulatory authorities having jurisdiction over the Plan, the stock options granted under it and the shares of Common Stock issued pursuant to it. B. No shares of Common Stock or other assets shall be issued or delivered under the Plan unless and until there shall have been compliance with all applicable requirements of Federal and state securities laws, including the filing and effectiveness of the Form S-8 registration statement for the shares of Common Stock issuable under the Plan, and all applicable listing requirements of any stock exchange (or the Nasdaq National Market, if applicable) on which Common Stock is then listed for trading. VII. NO EMPLOYMENT/SERVICE RIGHTS Nothing in the Plan shall confer upon the Optionee or the Participant any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation (or any Parent or Subsidiary employing or retaining such person) or of the Optionee or the Participant, which rights are hereby expressly reserved by each, to terminate such person's Service at any time for any reason, with or without cause. 29 APPENDIX -------- The following definitions shall be in effect under the Plan: A. AUTOMATIC OPTION GRANT PROGRAM shall mean the automatic option ------------------------------ grant program in effect under the Plan. B. BOARD shall mean the Corporation's Board of Directors. ----- C. CHANGE IN CONTROL shall mean a change in ownership or control of ----------------- the Corporation effected through either of the following transactions: (i) the acquisition, directly or indirectly by any person or related group of persons (other than the Corporation or a person that directly or indirectly controls, is controlled by, or is under common control with, the Corporation), of beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation's outstanding securities pursuant to a tender or exchange offer made directly to the Corporation's stockholders, or (ii) a change in the composition of the Board over a period of thirty-six (36) consecutive months or less such that a majority of the Board members ceases, by reason of one or more contested elections for Board membership, to be comprised of individuals who either (A) have been Board members continuously since the beginning of such period or (B) have been elected or nominated for election as Board members during such period by at least a majority of the Board members described in clause (A) who were still in office at the time the Board approved such election or nomination. D. CODE shall mean the Internal Revenue Code of 1986, as amended. ---- E. COMMON STOCK shall mean the Corporation's common stock. ------------ F. CORPORATE TRANSACTION shall mean either of the following --------------------- stockholder-approved transactions to which the Corporation is a party: (i) a merger or consolidation in which securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation's outstanding securities are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction, or (ii) the sale, transfer or other disposition of all or substantially all of the Corporation's assets in complete liquidation or dissolution of the Corporation. G. CORPORATION shall mean COMPS.COM, INC., a Delaware corporation, ----------- and any corporate successor to all or substantially all of the assets or voting stock of COMPS.COM, INC. which shall by appropriate action adopt the Plan. A-1 H. DIRECTOR FEE OPTION GRANT PROGRAM shall mean the special stock --------------------------------- option grant in effect for non-employee Board members under Article Six of the Plan. I. DISCRETIONARY OPTION GRANT PROGRAM shall mean the discretionary ---------------------------------- option grant program in effect under the Plan. J. ELIGIBLE DIRECTOR shall mean a non-employee Board member eligible ----------------- to participate in the Automatic Option Grant Program in accordance with the eligibility provisions of Articles One and Five. K. EMPLOYEE shall mean an individual who is in the employ of the -------- Corporation (or any Parent or Subsidiary), subject to the control and direction of the employer entity as to both the work to be performed and the manner and method of performance. L. EXERCISE DATE shall mean the date on which the Corporation shall ------------- have received written notice of the option exercise. M. FAIR MARKET VALUE per share of Common Stock on any relevant date ----------------- shall be determined in accordance with the following provisions: (i) If the Common Stock is at the time traded on the Nasdaq National Market, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question, as such price is reported by the National Association of Securities Dealers on the Nasdaq National Market. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such quotation exists. (ii) If the Common Stock is at the time listed on any Stock Exchange, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question on the Stock Exchange determined by the Plan Administrator to be the primary market for the Common Stock, as such price is officially quoted in the composite tape of transactions on such exchange. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such quotation exists. (iii) For purposes of any option grants made on the Underwriting Date, the Fair Market Value shall be deemed to be equal to the price per share at which the Common Stock is to be sold in the initial public offering pursuant to the Underwriting Agreement. A-2. N. HOSTILE TAKE-OVER shall mean the acquisition, directly or ----------------- indirectly, by any person or related group of persons (other than the Corporation or a person that directly or indirectly controls, is controlled by, or is under common control with, the Corporation) of beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation's outstanding securities pursuant to a tender or exchange offer made directly to the Corporation's stockholders which the Board does not recommend such stockholders to accept. O. INCENTIVE OPTION shall mean an option which satisfies the ---------------- requirements of Code Section 422. P. INVOLUNTARY TERMINATION shall mean the termination of the Service ----------------------- of any individual which occurs by reason of: (i) such individual's involuntary dismissal or discharge by the Corporation for reasons other than Misconduct, or (ii) such individual's voluntary resignation following (A) a material reduction in his or her duties and responsibilities, (B) a reduction in his or her level of compensation (including base salary, fringe benefits and target bonus under any corporate-performance based bonus or incentive programs) by more than ten percent (10%) or (C) a relocation of such individual's place of employment by more than twenty- five (25) miles, provided and only if such reduction or relocation is effected by the Corporation without the individual's consent. However, in no event shall any change to the individual's title or reporting responsibilities which occurs by reason of the Corporation's conversion from a public company to a subsidiary or a division of the acquiring corporation in a Corporate Transaction or Change in Control be deemed grounds for a clause (A) resignation if the individual's day-to-day functions remain substantially the same as immediately prior to such Corporate Transaction or Change in Control. Q. MISCONDUCT shall mean the commission of any act of fraud, ---------- embezzlement or dishonesty by the Optionee or Participant, any unauthorized use or disclosure by such person of confidential information or trade secrets of the Corporation (or any Parent or Subsidiary), or any other intentional misconduct by such person adversely affecting the business or affairs of the Corporation (or any Parent or Subsidiary) in a material manner. The foregoing definition shall not be deemed to be inclusive of all the acts or omissions which the Corporation (or any Parent or Subsidiary) may consider as grounds for the dismissal or discharge of any Optionee, Participant or other person in the Service of the Corporation (or any Parent or Subsidiary). R. 1934 ACT shall mean the Securities Exchange Act of 1934, as -------- amended. S. NON-STATUTORY OPTION shall mean an option not intended to satisfy -------------------- the requirements of Code Section 422. A-3. T. OPTIONEE shall mean any person to whom an option is granted under -------- the Discretionary Option Grant, Salary Investment Option Grant, Automatic Option Grant or Director Fee Option Grant Program. U. PARENT shall mean any corporation (other than the Corporation) in ------ an unbroken chain of corporations ending with the Corporation, provided each corporation in the unbroken chain (other than the Corporation) owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. V. PARTICIPANT shall mean any person who is issued shares of Common ----------- Stock under the Stock Issuance Program. W. PERMANENT DISABILITY OR PERMANENTLY DISABLED shall mean the -------------------------------------------- inability of the Optionee or the Participant to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment expected to result in death or to be of continuous duration of twelve (12) months or more. However, solely for purposes of the Automatic Option Grant and Director Fee Option Grant Programs, Permanent Disability or Permanently Disabled shall mean the inability of the non-employee Board member to perform his or her usual duties as a Board member by reason of any medically determinable physical or mental impairment expected to result in death or to be of continuous duration of twelve (12) months or more. X. PLAN shall mean the Corporation's 1999 Stock Incentive Plan, as ---- set forth in this document. Y. PLAN ADMINISTRATOR shall mean the particular entity, whether the ------------------ Primary Committee, the Board or the Secondary Committee, which is authorized to administer the Discretionary Option Grant and Stock Issuance Programs with respect to one or more classes of eligible persons, to the extent such entity is carrying out its administrative functions under those programs with respect to the persons under its jurisdiction. Z. PLAN EFFECTIVE DATE shall mean the date the Plan shall become ------------------- effective and shall be coincident with the Underwriting Date. AA. PREDECESSOR PLANS shall mean the Corporation's Amended and ----------------- Restated Stock Option Plan, the 1998 Supplemental Option Plan and the 1998 Equity Participation Plan, as in effect immediately prior to the Plan Effective Date hereunder. BB. PRIMARY COMMITTEE shall mean the committee of two (2) or more ----------------- non-employee Board members appointed by the Board to administer the Discretionary Option Grant and Stock Issuance Programs with respect to Section 16 Insiders and to administer the Salary Investment Option Grant Program solely with respect to the selection of the eligible individuals who may participate in such program. CC. SALARY INVESTMENT OPTION GRANT PROGRAM shall mean the salary -------------------------------------- investment option grant program in effect under the Plan. A-4. DD. SECONDARY COMMITTEE shall mean a committee of one or more Board ------------------- members appointed by the Board to administer the Discretionary Option Grant and Stock Issuance Programs with respect to eligible persons other than Section 16 Insiders. EE. SECTION 16 INSIDER shall mean an officer or director of the ------------------ Corporation subject to the short-swing profit liabilities of Section 16 of the 1934 Act. FF. SERVICE shall mean the performance of services for the ------- Corporation (or any Parent or Subsidiary) by a person in the capacity of an Employee, a non-employee member of the board of directors or a consultant or independent advisor, except to the extent otherwise specifically provided in the documents evidencing the option grant or stock issuance. GG. STOCK EXCHANGE shall mean either the American Stock Exchange or -------------- the New York Stock Exchange. HH. STOCK ISSUANCE AGREEMENT shall mean the agreement entered into by ------------------------ the Corporation and the Participant at the time of issuance of shares of Common Stock under the Stock Issuance Program. II. STOCK ISSUANCE PROGRAM shall mean the stock issuance program in ---------------------- effect under the Plan. JJ. SUBSIDIARY shall mean any corporation (other than the ---------- Corporation) in an unbroken chain of corporations beginning with the Corporation, provided each corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. KK. TAKE-OVER PRICE shall mean the greater of (i) the Fair Market --------------- ------- Value per share of Common Stock on the date the option is surrendered to the Corporation in connection with a Hostile Take-Over or (ii) the highest reported price per share of Common Stock paid by the tender offeror in effecting such Hostile Take-Over. However, if the surrendered option is an Incentive Option, the Take-Over Price shall not exceed the clause (i) price per share. LL. TAXES shall mean the Federal, state and local income and ----- employment tax liabilities incurred by the holder of Non-Statutory Options or unvested shares of Common Stock in connection with the exercise of those options or the vesting of those shares. MM. 10% STOCKHOLDER shall mean the owner of stock (as determined --------------- under Code Section 424(d)) possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Corporation (or any Parent or Subsidiary). NN. UNDERWRITING AGREEMENT shall mean the agreement between the ---------------------- Corporation and the underwriter or underwriters managing the initial public offering of the Common Stock. A-5. OO. UNDERWRITING DATE shall mean the date on which the Underwriting ----------------- Agreement is executed and priced in connection with an initial public offering of the Common Stock. A-6. EX-10.38 41 EMPLOYEE STOCK PURCHASE PLAN EXHIBIT 10.38 COMPS.COM, INC. 1999 EMPLOYEE STOCK PURCHASE PLAN --------------------------------- I. PURPOSE OF THE PLAN This Employee Stock Purchase Plan is intended to promote the interests of COMPS.COM, INC., a Delaware Corporation, by providing eligible employees with the opportunity to acquire a proprietary interest in the Corporation through participation in a payroll-deduction based employee stock purchase plan designed to qualify under Section 423 of the Code. Capitalized terms herein shall have the meanings assigned to such terms in the attached Appendix. II. ADMINISTRATION OF THE PLAN The Plan Administrator shall have full authority to interpret and construe any provision of the Plan and to adopt such rules and regulations for administering the Plan as it may deem necessary in order to comply with the requirements of Code Section 423. Decisions of the Plan Administrator shall be final and binding on all parties having an interest in the Plan. III. STOCK SUBJECT TO PLAN A. The stock purchasable under the Plan shall be shares of authorized but unissued or reacquired Common Stock, including shares of Common Stock purchased on the open market. The number of shares of Common Stock initially reserved for issuance over the term of the Plan shall be limited to three hundred thousand (300,000) shares. B. The number of shares of Common Stock available for issuance under the Plan shall automatically increase on the first trading day in January each calendar year during the term of the Plan, beginning with calendar year 2000, by an amount equal to two percent (2%) of the total number of shares of Common Stock outstanding on the last trading day in December of the immediately preceding calendar year, but in no event shall any such annual increase exceed three hundred thousand (300,000) shares. C. Should any change be made to the Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without the Corporation's receipt of consideration, appropriate adjustments shall be made to (i) the maximum number and class of securities issuable under the Plan, (ii) the maximum number and class of securities purchasable per Participant on any one Purchase Date, (iii) the maximum number and class of securities purchasable by all Participants in the aggregate on any one Purchase Date, (iv) the maximum number and/or class of securities by which the share reserve is to increase automatically each calendar year pursuant to the provisions of Section III.B of this Article One and (v) the number and class of securities and the price per share in effect under each outstanding purchase right in order to prevent the dilution or enlargement of benefits thereunder. IV. OFFERING PERIODS A. Shares of Common Stock shall be offered for purchase under the Plan through a series of successive offering periods until such time as (i) the maximum number of shares of Common Stock available for issuance under the Plan shall have been purchased or (ii) the Plan shall have been sooner terminated. B. Each offering period shall be of such duration (not to exceed twenty-four (24) months) as determined by the Plan Administrator prior to the start date of such offering period. However, the initial offering period shall commence at the Effective Time and terminate on the last business day in July 2001. The next offering period shall commence on the first business day in August 2001, and subsequent offering periods shall commence as designated by the Plan Administrator. C. Each offering period shall be comprised of a series of one or more successive Purchase Intervals. Purchase Intervals shall run from the first business day in February each year to the last business day in July of the same year and from the first business day in August each year to the last business day in January of the following year. However, the first Purchase Interval in effect under the initial offering period shall commence at the Effective Time and terminate on the last business day in July 1999. D. Should the Fair Market Value per share of Common Stock on any Purchase Date within an offering period be less than the Fair Market Value per share of Common Stock on the start date of that offering period, then that offering period shall automatically terminate immediately after the purchase of shares of Common Stock on such Purchase Date, and a new offering period shall commence on the next business day following such Purchase Date. The new offering period shall have a duration of twenty (24) months, unless a shorter duration is established by the Plan Administrator within five (5) business days following the start date of that offering period. V. ELIGIBILITY A. Each individual who is an Eligible Employee on the start date of any offering period under the Plan may enter that offering period on such start date or on any subsequent Semi-Annual Entry Date within that offering period, provided he or she remains an Eligible Employee. B. Each individual who first becomes an Eligible Employee after the start date of an offering period may enter that offering period on any subsequent Semi-Annual Entry Date within that offering period on which he or she is an Eligible Employee. C. The date an individual enters an offering period shall be designated his or her Entry Date for purposes of that offering period. 2. D. To participate in the Plan for a particular offering period, the Eligible Employee must complete the enrollment forms prescribed by the Plan Administrator (including a stock purchase agreement and a payroll deduction authorization) and file such forms with the Plan Administrator (or its designate) on or before his or her scheduled Entry Date. VI. PAYROLL DEDUCTIONS A. The payroll deduction authorized by the Participant for purposes of acquiring shares of Common Stock during an offering period may be any multiple of one percent (1%) of the Cash Earnings paid to the Participant during each Purchase Interval within that offering period, up to a maximum of ten percent (10%). The deduction rate so authorized shall continue in effect throughout the offering period, except to the extent such rate is changed in accordance with the following guidelines: (i) The Participant may, at any time during the offering period, reduce his or her rate of payroll deduction to become effective as soon as possible after filing the appropriate form with the Plan Administrator. The Participant may not, however, effect more than one (1) such reduction per Purchase Interval. (ii) The Participant may, prior to the commencement of any new Purchase Interval within the offering period, increase the rate of his or her payroll deduction by filing the appropriate form with the Plan Administrator. The new rate (which may not exceed the ten percent (10%) maximum) shall become effective on the start date of the first Purchase Interval following the filing of such form. B. Payroll deductions shall begin on the first pay day administratively feasible following the Participant's Entry Date into the offering period and shall (unless sooner terminated by the Participant) continue through the pay day ending with or immediately prior to the last day of that offering period. The amounts so collected shall be credited to the Participant's book account under the Plan, but no interest shall be paid on the balance from time to time outstanding in such account. The amounts collected from the Participant shall not be required to be held in any segregated account or trust fund and may be commingled with the general assets of the Corporation and used for general corporate purposes. C. Payroll deductions shall automatically cease upon the termination of the Participant's purchase right in accordance with the provisions of the Plan. D. The Participant's acquisition of Common Stock under the Plan on any Purchase Date shall neither limit nor require the Participant's acquisition of Common Stock on any subsequent Purchase Date, whether within the same or a different offering period. 3. VII. PURCHASE RIGHTS A. GRANT OF PURCHASE RIGHT. A Participant shall be granted a ----------------------- separate purchase right for each offering period in which he or she participates. The purchase right shall be granted on the Participant's Entry Date into the offering period and shall provide the Participant with the right to purchase shares of Common Stock, in a series of successive installments over the remainder of such offering period, upon the terms set forth below. The Participant shall execute a stock purchase agreement embodying such terms and such other provisions (not inconsistent with the Plan) as the Plan Administrator may deem advisable. Under no circumstances shall purchase rights be granted under the Plan to any Eligible Employee if such individual would, immediately after the grant, own (within the meaning of Code Section 424(d)) or hold outstanding options or other rights to purchase, stock possessing five percent (5%) or more of the total combined voting power or value of all classes of stock of the Corporation or any Corporate Affiliate. B. EXERCISE OF THE PURCHASE RIGHT. Each purchase right shall be ------------------------------ automatically exercised in installments on each successive Purchase Date within the offering period, and shares of Common Stock shall accordingly be purchased on behalf of each Participant on each such Purchase Date. The purchase shall be effected by applying the Participant's payroll deductions for the Purchase Interval ending on such Purchase Date to the purchase of whole shares of Common Stock at the purchase price in effect for the Participant for that Purchase Date. C. PURCHASE PRICE. The purchase price per share at which Common -------------- Stock will be purchased on the Participant's behalf on each Purchase Date within the offering period shall be equal to eighty-five percent (85%) of the lower of ----- (i) the Fair Market Value per share of Common Stock on the Participant's Entry Date into that offering period or (ii) the Fair Market Value per share of Common Stock on that Purchase Date. D. NUMBER OF PURCHASABLE SHARES. The number of shares of Common ---------------------------- Stock purchasable by a Participant on each Purchase Date during the offering period shall be the number of whole shares obtained by dividing the amount collected from the Participant through payroll deductions during the Purchase Interval ending with that Purchase Date by the purchase price in effect for the Participant for that Purchase Date. However, the maximum number of shares of Common Stock purchasable per Participant on any one Purchase Date shall not exceed one thousand five hundred (1,500) shares, subject to periodic adjustments in the event of certain changes in the Corporation's capitalization. In addition, the maximum aggregate number of shares of Common Stock purchasable by all Participants on any one Purchase Date shall not exceed seventy five thousand (75,000) shares, subject to periodic adjustments in the event of certain changes in the Corporation's capitalization. E. EXCESS PAYROLL DEDUCTIONS. Any payroll deductions not applied to ------------------------- the purchase of shares of Common Stock on any Purchase Date because they are not sufficient to purchase a whole share of Common Stock shall be held for the purchase of Common Stock on 4. the next Purchase Date. However, any payroll deductions not applied to the purchase of Common Stock by reason of the limitation on the maximum number of shares purchasable per Participant or in the aggregate on the Purchase Date shall be promptly refunded. (i) TERMINATION OF PURCHASE RIGHT. The following provisions ----------------------------- shall govern the termination of outstanding purchase rights: (ii) A Participant may, at any time prior to the next scheduled Purchase Date in the offering period, terminate his or her outstanding purchase right by filing the appropriate form with the Plan Administrator (or its designate), and no further payroll deductions shall be collected from the Participant with respect to the terminated purchase right. Any payroll deductions collected during the Purchase Interval in which such termination occurs shall, at the Participant's election, be immediately refunded or held for the purchase of shares on the next Purchase Date. If no such election is made at the time such purchase right is terminated, then the payroll deductions collected with respect to the terminated right shall be refunded as soon as possible. (iii) The termination of such purchase right shall be irrevocable, and the Participant may not subsequently rejoin the offering period for which the terminated purchase right was granted. In order to resume participation in any subsequent offering period, such individual must re-enroll in the Plan (by making a timely filing of the prescribed enrollment forms) on or before his or her scheduled Entry Date into that offering period. (iv) Should the Participant cease to remain an Eligible Employee for any reason (including death, disability or change in status) while his or her purchase right remains outstanding, then that purchase right shall immediately terminate, and all of the Participant's payroll deductions for the Purchase Interval in which the purchase right so terminates shall be immediately refunded. However, should the Participant cease to remain in active service by reason of an approved unpaid leave of absence, then the Participant shall have the right, exercisable up until the last business day of the Purchase Interval in which such leave commences, to (a) withdraw all the payroll deductions collected to date on his or her behalf for that Purchase Interval or (b) have such funds held for the purchase of shares on his or her behalf on the next scheduled Purchase Date. In no event, however, shall any further payroll deductions be collected on the Participant's behalf during such leave. Upon the Participant's return to active service (x) within ninety (90) days following the commencement of such leave or (y) the expiration of any longer period for which such Participant's right to reemployment with the Corporation is guaranteed by either statute or contract, his or her payroll deductions under the Plan shall automatically resume at the rate in effect at the time the leave began, unless the Participant withdraws from the Plan prior to his or her return. An individual who returns to active employment following a leave of absence which exceeds in duration the applicable (x) or (y) time period will be treated as a new Employee for purposes of subsequent participation in the Plan and must accordingly re-enroll in the Plan (by making a timely filing of the prescribed enrollment forms) on or before his or her scheduled Entry Date into the offering period. 5. F. CHANGE IN CONTROL. Each outstanding purchase right shall ----------------- automatically be exercised, immediately prior to the effective date of any Change in Control, by applying the payroll deductions of each Participant for the Purchase Interval in which such Change in Control occurs to the purchase of whole shares of Common Stock at a purchase price per share equal to eighty-five percent (85%) of the lower of (i) the Fair Market Value per share of Common ----- Stock on the Participant's Entry Date into the offering period in which such Change in Control occurs or (ii) the Fair Market Value per share of Common Stock immediately prior to the effective date of such Change in Control. However, the applicable limitation on the number of shares of Common Stock purchasable per Participant shall continue to apply to any such purchase, but not the limitation applicable to the maximum number of shares of Common Stock purchasable in the aggregate. The Corporation shall use its best efforts to provide at least ten (10)-days prior written notice of the occurrence of any Change in Control, and Participants shall, following the receipt of such notice, have the right to terminate their outstanding purchase rights prior to the effective date of the Change in Control. G. PRORATION OF PURCHASE RIGHTS. Should the total number of shares ---------------------------- of Common Stock to be purchased pursuant to outstanding purchase rights on any particular date exceed the number of shares then available for issuance under the Plan, the Plan Administrator shall make a pro-rata allocation of the available shares on a uniform and nondiscriminatory basis, and the payroll deductions of each Participant, to the extent in excess of the aggregate purchase price payable for the Common Stock pro-rated to such individual, shall be refunded. H. ASSIGNABILITY. The purchase right shall be exercisable only by ------------- the Participant and shall not be assignable or transferable by the Participant. I. STOCKHOLDER RIGHTS. A Participant shall have no stockholder ------------------ rights with respect to the shares subject to his or her outstanding purchase right until the shares are purchased on the Participant's behalf in accordance with the provisions of the Plan and the Participant has become a holder of record of the purchased shares. VIII. ACCRUAL LIMITATIONS A. No Participant shall be entitled to accrue rights to acquire Common Stock pursuant to any purchase right outstanding under this Plan if and to the extent such accrual, when aggregated with (i) rights to purchase Common Stock accrued under any other purchase right granted under this Plan and (ii) similar rights accrued under other employee stock purchase plans (within the meaning of Code Section 423) of the Corporation or any Corporate Affiliate, would otherwise permit such Participant to purchase more than Twenty-Five Thousand Dollars ($25,000.00) worth of stock of the Corporation or any Corporate Affiliate (determined on the basis of the Fair Market Value per share on the date or dates such rights are granted) for each calendar year such rights are at any time outstanding. 6. B. For purposes of applying such accrual limitations to the purchase rights granted under the Plan, the following provisions shall be in effect: (i) The right to acquire Common Stock under each outstanding purchase right shall accrue in a series of installments on each successive Purchase Date during the offering period on which such right remains outstanding. (ii) No right to acquire Common Stock under any outstanding purchase right shall accrue to the extent the Participant has already accrued in the same calendar year the right to acquire Common Stock under one or more other purchase rights at a rate equal to Twenty-Five Thousand Dollars ($25,000.00) worth of Common Stock (determined on the basis of the Fair Market Value per share on the date or dates of grant) for each calendar year such rights were at any time outstanding. C. If by reason of such accrual limitations, any purchase right of a Participant does not accrue for a particular Purchase Interval, then the payroll deductions which the Participant made during that Purchase Interval with respect to such purchase right shall be promptly refunded. D. In the event there is any conflict between the provisions of this Article and one or more provisions of the Plan or any instrument issued thereunder, the provisions of this Article shall be controlling. IX. EFFECTIVE DATE AND TERM OF THE PLAN A. The Plan was adopted by the Board on February 19, 1999, and shall become effective at the Effective Time, provided no purchase rights granted -------- under the Plan shall be exercised, and no shares of Common Stock shall be issued hereunder, until (i) the Plan shall have been approved by the stockholders of the Corporation and (ii) the Corporation shall have complied with all applicable requirements of the 1933 Act (including the registration of the shares of Common Stock issuable under the Plan on a Form S-8 registration statement filed with the Securities and Exchange Commission), all applicable listing requirements of any stock exchange (or the Nasdaq National Market, if applicable) on which the Common Stock is listed for trading and all other applicable requirements established by law or regulation. In the event such stockholder approval is not obtained, or such compliance is not effected, within twelve (12) months after the date on which the Plan is adopted by the Board, the Plan shall terminate and have no further force or effect, and all sums collected from Participants during the initial offering period hereunder shall be refunded. B. Unless sooner terminated by the Board, the Plan shall terminate upon the earliest of (i) the last business day in July, 2009, (ii) the date on -------- which all shares available for issuance under the Plan shall have been sold pursuant to purchase rights exercised under the Plan or (iii) the date on which all purchase rights are exercised in connection with a Corporate Transaction. No further purchase rights shall be granted or exercised, and no further payroll deductions shall be collected, under the Plan following such termination. 7. X. AMENDMENT OF THE PLAN A. The Board may alter, amend, suspend or terminate the Plan at any time to become effective immediately following the close of any Purchase Interval. However, the Plan may be amended or terminated immediately upon Board action, if and to the extent necessary to assure that the Corporation will not recognize, for financial reporting purposes, any compensation expense in connection with the shares of Common Stock offered for purchase under the Plan, should the financial accounting rules applicable to the Plan at the Effective Time be subsequently revised so as to require the recognition of compensation expense in the absence of such amendment or termination. B. In no event may the Board effect any of the following amendments or revisions to the Plan without the approval of the Corporation's stockholders: (i) increase the number of shares of Common Stock issuable under the Plan or the maximum number of shares purchasable per Participant or in the aggregate on any one Purchase Date, except for permissible adjustments in the event of certain changes in the Corporation's capitalization, (ii) alter the purchase price formula so as to reduce the purchase price payable for the shares of Common Stock purchasable under the Plan or (iii) modify eligibility requirements for participation in the Plan. XI. GENERAL PROVISIONS A. All costs and expenses incurred in the administration of the Plan shall be paid by the Corporation; however, each Plan Participant shall bear all costs and expenses incurred by such individual in the sale or other disposition of any shares purchased under the Plan. B. Nothing in the Plan shall confer upon the Participant any right to continue in the employ of the Corporation or any Corporate Affiliate for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation (or any Corporate Affiliate employing such person) or of the Participant, which rights are hereby expressly reserved by each, to terminate such person's employment at any time for any reason, with or without cause. C. The provisions of the Plan shall be governed by the laws of the State of California without resort to that State's conflict-of-laws rules. 8. SCHEDULE A ---------- CORPORATIONS PARTICIPATING IN EMPLOYEE STOCK PURCHASE PLAN AS OF THE EFFECTIVE TIME ------------------------ COMPS.COM, INC. APPENDIX -------- The following definitions shall be in effect under the Plan: A. BOARD shall mean the Corporation's Board of Directors. ----- B. CASH EARNINGS shall mean the (i) regular base salary paid to a ------------- Participant by one or more Participating Companies during such individual's period of participation in one or more offering periods under the Plan plus (ii) all overtime payments, bonuses, commissions, profit-sharing distributions and other incentive-type payments. Such Cash Earnings shall be calculated before deduction of (A) any income or employment tax withholdings or (B) any and all contributions made by the Participant to any Code Section 401(k) salary deferral plan or Code Section 125 cafeteria benefit program now or hereafter established by the Corporation or any Corporate Affiliate. However, Cash Earnings shall NOT include any contributions made on the Participant's behalf by the Corporation or any Corporate Affiliate to any employee benefit or welfare plan now or hereafter established. C. CHANGE IN CONTROL shall mean a change in ownership of the ----------------- Corporation pursuant to any of the following transactions: (i) a merger or consolidation in which securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation's outstanding securities are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction, or (ii) the sale, transfer or other disposition of all or substantially all of the assets of the Corporation in complete liquidation or dissolution of the Corporation, or (iii) the acquisition, directly or indirectly by an person or related group of persons (other than the Corporation or a person that directly or indirectly controls, is controlled by or is under common control with the Corporation) of beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation's outstanding securities pursuant to a tender or exchange offer made directly to the Corporation's stockholders. C. CODE shall mean the Internal Revenue Code of 1986, as amended. ---- D. COMMON STOCK shall mean the Corporation's common stock. ------------ E. CORPORATE AFFILIATE shall mean any parent or subsidiary ------------------- corporation of the Corporation (as determined in accordance with Code Section 424), whether now existing or subsequently established. A-1. G. CORPORATION shall mean COMPS.COM, INC., a Delaware corporation, ----------- and any corporate successor to all or substantially all of the assets or voting stock of COMPS.COM, INC., which shall by appropriate action adopt the Plan. H. EFFECTIVE TIME shall mean the time at which the Underwriting -------------- Agreement is executed and the Common Stock priced for the initial public offering. Any Corporate Affiliate which becomes a Participating Corporation after such Effective Time shall designate a subsequent Effective Time with respect to its employee-Participants. I. ELIGIBLE EMPLOYEE shall mean any person who is employed by a ----------------- Participating Corporation on a basis under which he or she is regularly expected to render more than twenty (20) hours of service per week for more than five (5) months per calendar year for earnings considered wages under Code Section 3401(a). J. ENTRY DATE shall mean the date an Eligible Employee first ---------- commences participation in the offering period in effect under the Plan. The earliest Entry Date under the Plan shall be the Effective Time. K. FAIR MARKET VALUE per share of Common Stock on any relevant date ----------------- shall be determined in accordance with the following provisions: (i) If the Common Stock is at the time traded on the Nasdaq National Market, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question, as such price is reported by the National Association of Securities Dealers on the Nasdaq National Market. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such quotation exists. (ii) If the Common Stock is at the time listed on any Stock Exchange, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question on the Stock Exchange determined by the Plan Administrator to be the primary market for the Common Stock, as such price is officially quoted in the composite tape of transactions on such exchange. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such quotation exists. (iii) For purposes of the initial offering period which begins at the Effective Time, the Fair Market Value shall be deemed to be equal to the price per share at which the Common Stock is sold in the initial public offering pursuant to the Underwriting Agreement. L. 1933 ACT shall mean the Securities Act of 1933, as amended. -------- A-2. M. PARTICIPANT shall mean any Eligible Employee of a Participating ----------- Corporation who is actively participating in the Plan. N. PARTICIPATING CORPORATION shall mean the Corporation and such ------------------------- Corporate Affiliate or Affiliates as may be authorized from time to time by the Board to extend the benefits of the Plan to their Eligible Employees. The Participating Corporations in the Plan are listed in attached Schedule A. O. PLAN shall mean the Corporation's 1999 Employee Stock Purchase ---- Plan, as set forth in this document. P. PLAN ADMINISTRATOR shall mean the committee of two (2) or more ------------------ Board members appointed by the Board to administer the Plan. Q. PURCHASE DATE shall mean the last business day of each Purchase ------------- Interval. The initial Purchase Date shall be July 30, 1999. R. PURCHASE INTERVAL shall mean each successive six (6)-month period ----------------- within the offering period at the end of which there shall be purchased shares of Common Stock on behalf of each Participant. S. SEMI-ANNUAL ENTRY DATE shall mean the first business day in ---------------------- February and August each year on which an Eligible Employee may first enter an offering period. T. STOCK EXCHANGE shall mean either the American Stock Exchange or -------------- the New York Stock Exchange. U. UNDERWRITING AGREEMENT shall mean the agreement between the ---------------------- Corporation and the underwriter or underwriters managing the initial public offering of the Common Stock. A-3. EX-10.39 42 ASSIGNMENT & ASSUMPTION AGMT DATED 11/6/98 EXHIBIT 10.39 ASSIGNMENT AND ASSUMPTION AGREEMENT ----------------------------------- This Assignment and Assumption Agreement ("Assignment") is entered into this 6th day of November, 1998, by and among REALBID LLC, a California limited liability company, Emmett DeMoss, an individual, Robert Potter, an individual, (collectively, "Assignors"), and COMPS InfoSystems, Inc., a Delaware corporation ("Assignee"). RECITALS -------- WHEREAS, Assignors and Assignee have entered into that certain Asset Purchase Agreement of even date herewith (the "Purchase Agreement") by and among Assignors and Assignee, for the sale by Assignors of the Purchased Assets (as defined in Section 2.1 of the Purchase Agreement) (initially capitalized ----------- terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Purchase Agreement); WHEREAS, the execution and delivery of this Agreement is a condition precedent to the closing of the Purchase Agreement; NOW, THEREFORE, in consideration of the mutual covenants and promises set forth herein, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows: 1. ASSIGNMENT AND ASSUMPTION. Assignors hereby agree that, ------------------------- effective as of the Closing, they shall grant, sell, convey, assign, transfer and deliver unto Assignee, and Assignee hereby agrees to accept and assume, free and clear of any Encumbrance or adverse claim of any kind whatsoever, except Permitted Encumbrances, all of Assignor's right, title and interest in and to all the Purchased Assets (as such assets are defined and described in the Purchase Agreement and the schedules relating thereto). Assignors hereby assigns, and Assignee hereby assumes and agrees to satisfy and perform when due those liabilities and obligations arising from the Assumed Liabilities on and after the Closing Date. 2. ASSIGNORS COVENANT. Assignors hereby covenant that they will, ------------------ any time and from time to time, upon written request therefor, execute and deliver to Assignee, its successors and assigns, any new or confirmatory instruments which may be reasonably necessary in order to protect or fully assign and transfer to and vest in Assignee, or its successors and assigns, all of Assignors' right, title and interest in and to the Purchased Assets. 3. RETAINED LIABILITIES. The parties acknowledge and agree that, -------------------- except for the Assumed Liabilities, Assignors shall retain and be responsible for all obligations, liabilities, and claims of any nature, accruing, arising out of, or relating to Assignors and REALBID LLC's business (including without limitation (i) any liability or obligation arising out of or relating to any of the Excluded Assets (ii) the BAP Loan, the ERD Loan and the LLC Managers Accrued Fee (as each is described in the Financial Statements) and (iii) any and all payables, costs and expenses of REALBID incurred before or after the Closing Date including those payables, costs and expenses set forth in the Financial Statements), whether actual or contingent, matured or unmatured, liquidated or unliquidated, or know or unknown (the "Retained Liabilities"). Pursuant to the terms of the Purchase Agreement, Assignors shall indemnify and hold Assignee harmless from, against and in respect to (and shall reimburse Assignee for) any loss, liability, cost or expenses, including, without limitation, reasonable attorneys' fees, suffered or incurred by Assignee by reason of or resulting from the Retained Liabilities. 4. ENTIRE AGREEMENT. This Assignment, together with the Purchase ---------------- Agreement and all documents executed in connection with the Purchase Agreement, constitutes the entire agreement and understanding between and among the parties hereto with respect to the matters set forth herein, and supersedes and replaces any prior agreements and understandings, whether oral or written, between and among them with respect to such matters. Notwithstanding any other provisions of this Assignment to the contrary, nothing contained in this Assignment shall in any way superseded, modify, replace, amend, change, rescind, waive, exceed, expand, enlarge or in any way affect the provisions, including warranties, covenants, agreements, conditions, representations, or in general any of the rights and remedies, and any of the obligations and indemnifications of Assignors or Assignee set forth in the Purchase Agreement nor shall this Assignment expand or enlarge any remedies under the Purchase Agreement including without limitation any limits on indemnification specified therein. This Assignment is intended only to effect the transfer of certain property transferred pursuant to the Purchase Agreement and shall be governed entirely in accordance with the terms and conditions of the Purchase Agreement. 5. GOVERNING LAW. This Assignment shall in all respects be ------------- construed in accordance with and governed by the laws of the State of California without giving effect to its conflicts-of-laws principles (other than any provisions thereof validating the choice of the laws of the State of California in the governing law). 6. COUNTERPARTS. This Agreement may be executed in any number of ------------ counter parts and by facsimile and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. [SIGNATURE PAGE TO FOLLOW] IN WITNESS WHEREOF, the parties have executed this Assignment as of the day and year first written above. COMPS InfoSystems, Inc., REALBID LLC, a Delaware corporation a California limited liability company By: /s/ CHRISTOPHER A. CRANE By: /s/ ROBERT A. POTTER ------------------------------ --------------------------------- Christopher A. Crane Robert A. Potter, Manager President and Chief Executive Officer By: /s/ Emmett DeMoss ---------------------------------- Emmett DeMoss, Manager /s/ Robert Potter ---------------------------------- Robert Potter /s/ Emmett DeMoss ---------------------------------- Emmett DeMoss [SIGNATURE PAGE TO THE ASSIGNMENT AND ASSUMPTION AGREEMENT] EX-10.40 43 INTELLECTUAL PROPERTY ASGMT DATED 11/6/98 EXHIBIT 10.40 INTELLECTUAL PROPERTY ASSIGNMENT This Intellectual Property Assignment is entered into this 6th day of November, 1998, by and between REALBID LLC, a California limited liability company, ("Assignor"), and COMPS InfoSystems, Inc., a Delaware corporation ("Assignee"). WHEREAS, Assignee and Assignor are parties to that certain Asset Purchase Agreement dated as of even date herewith (the "Purchase Agreement") (initially capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Purchase Agreement); WHEREAS, the execution and delivery of this Intellectual Property Assignment is a condition precedent to Assignee's obligations under the Purchase Agreement. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: 1. Assignor assigns to Assignee, and Assignee hereby accepts such assignment of, Assignor's entire right, title and interest in and to all of the REALBID Intellectual Property (as such intellectual property is defined and described in the Purchase Agreement and the schedules relating thereto), including, without limitation, the service mark "REALBID," and all variations thereof, the domain name on the World Wide Web known as "realbid.com" and any successor name thereto, and all rights to damages and payments for past, present or future infringements or misappropriations thereof in all countries and the goodwill of the business and operations of REALBID associated with the Intellectual Property. 2. The rights, title and interest assigned under Section 1 above shall be --------- for Assignee's own use and enjoyment, and for the use and enjoyment of Assignee's successors, assigns or other legal representatives, as fully and entirely as the same would have been held and enjoyed by the Assignor if this assignment and sale had not been made. 3. Assignor authorizes and requests the Commissioner of Patents and Trademarks of the United States, and an official of any country or countries foreign to the United States, whose duty it is to register patents, trademarks or copyrights, to record Assignee as the assignee and owner of the Intellectual Property. 4. Concurrently with the execution of this Intellectual Property Assignment, Assignor shall deliver the original papers, applications, and other official documents relating to all patents and trademarks, and other Intellectual Property, assigned under Section 1 above. --------- 5. Assignor hereby represents and warrants that all rights, title, and interest assigned under Section 1 above are free and clear of Encumbrances and --------- that Assignor has not executed and will not execute any agreement or other instrument in conflict herewith. 6. Assignor hereby covenants and agrees that it shall cease and refrain from all use of all rights, title, and interests assigned under Section 1 above --------- in all countries of the world as of the date hereof. 7. With respect to the REALBID Intellectual Property, Assignor will, from and after the Closing (i) use its best efforts to keep such REALBID Intellectual Property confidential, including continuing to protect the confidential nature of such REALBID Intellectual Property as if the sale provided for in the Purchase Agreement had not occurred, (ii) not disclose the REALBID Intellectual Property to any third party and (iii) not use the REALBID Intellectual Property. 8. From time to time after the date hereof, Assignor will execute and deliver, or cause its affiliates to execute and deliver, to Assignee such instruments of sale, transfer, conveyance, assignment and delivery, and such consents, assurances, powers of attorney and other instruments as may be reasonably requested by Assignee or its counsel in order to vest in Assignee all right, title and interest of Assignors in and to the Purchased Assets and otherwise in order to carry out the purpose and intent of this Intellectual Property Assignment. 9. This Intellectual Property Assignment, together with the Purchase Agreement and all documents executed in connection with the Purchase Agreement, constitutes the entire agreement and understanding between and among the parties hereto with respect to the matters set forth herein, and supersedes and replaces any prior agreements and understandings, whether oral or written, between and among them with respect to such matters. Notwithstanding any other provisions of this Intellectual Property Assignment to the contrary, nothing contained in this Intellectual Property Assignment shall in any way superseded, modify, replace, amend, change, rescind, waive, exceed, expand, enlarge or in any way affect the provisions, including warranties, covenants, agreements, conditions, representations, or in general any of the rights and remedies, and any of the obligations and indemnifications of Assignors or Assignee set forth in the Purchase Agreement nor shall this Intellectual Property Assignment expand or enlarge any remedies under the Purchase Agreement including without limitation any limits on indemnification specified therein. This Intellectual Property Assignment is intended only to effect the transfer of certain property transferred pursuant to the Purchase Agreement and shall be governed entirely in accordance with the terms and conditions of the Purchase Agreement. 10. This Intellectual Property Assignment shall in all respects be construed in accordance with and governed by the laws of the State of California without giving effect to its conflicts-of-laws principles (other than any provisions thereof validating the choice of the laws of the State of California in the governing law). 11. This Intellectual Property Assignment may be executed by the parties herein in separate counterparts and by facsimile, each of which when so executed and delivered shall be an original, but all such counterparts and facsimile shall together shall constitute one and the same instrument. [SIGNATURE PAGE TO FOLLOW] -2- IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above. COMPS InfoSystems, Inc., REALBID LLC, a Delaware corporation a California limited liability company By: /s/ CHRISTOPHER A. CRANE By: /s/ ROBERT A. POTTER ---------------------------------- -------------------------------- Christopher A. Crane Robert A. Potter, Manager President and Chief Executive Officer By: /s/ EMMETT DeMOSS -------------------------------- Emmett DeMoss, Manager [SIGNATURE PAGE TO THE INTELLECTUAL PROPERTY ASSIGNMENT] -------------------------------------------------------- ACKNOWLEDGMENT STATE OF CALIFORNIA ) ) ss. COUNTY OF Marin ) On this 5th day of November, in the year 1998, before me, the undersigned Notary Public, duly commissioned and sworn, personally appeared Emmett DeMoss and Robert Potter, personally known to me (or proved to me on the ---------------------- basis of satisfactory evidence) to be the persons whose names are subscribed to the within instrument and acknowledged to me that they respectively executed the same in their authorized capacities, and that by their signature on the instrument the persons executed the instrument. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate above written. [SEAL] /s/ TROY L. SWANN -------------------- Notary Public in and for the aforesaid County and State ACKNOWLEDGMENT STATE OF CALIFORNIA ) ) ss. COUNTY OF SAN DIEGO ) On this 13th day of November, in the year 1998, before me, the undersigned Notary Public, duly commissioned and sworn, personally appeared Christopher A. Crane, personally known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person executed the instrument. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate above written. [SEAL] /s/ CANDICE L. JENKINS ------------------------------------- Notary Public in and for the aforesaid County and State EX-10.41 44 SERVICE MARK ASGMNT DATED 11/6/98 EXHIBIT 10.41 SERVICE MARK ASSIGNMENT ----------------------- This Service Mark Assignment (hereinafter referred to as "Assignment") is effective as of the 5th day of November, 1998, by and between REALBID LLC, a California limited liability company, having its principal place of business at 700 Larkspur Landing Circle, Suite 199, Larkspur, California 94939 (hereinafter referred to as "Assignor") and COMPS INFOSYSTEMS, INC., a Delaware corporation, having its principal place of business at 9888 Carroll Centre Road, Suite 100, San Diego, CA 92126 (hereinafter referred to as "Assignee"). WHEREAS, the parties have entered into a certain Asset Purchase Agreement dated as of November 6, 1998, pursuant to which the parties are entering into this Assignment; WHEREAS, Assignor is willing to assign to Assignee all rights, title, and interest that Assignor may possess throughout the world in an to the service mark set forth on Schedule A (which is attached hereto and incorporated herewith by reference), and all other rights appurtenant thereto, including, but not limited to, all common law rights, title, and interest, trademark, trade name, trade dress or similar rights, and the right to recover for past infringement of any of the foregoing in the United States of America and in all other countries and jurisdictions of the world in and to said service mark and all applications and eventual registrations thereof (hereinafter collectively referred to as the "Service Mark") and any goodwill associated with and symbolized by the Service mark which Assignor has acquired and not abandoned; WHEREAS, in order to avoid any doubt as to Assignor's assignment of any and all rights that Assignor may have in and to the Service Mark, Assignor further wishes to quitclaim to Assignee all rights, title, and interest which Assignor may possess throughout the world in and to the Service Mark; and WHEREAS, Assignee is desirous of acquiring all such rights, title and interest in and to the Service Mark throughout the world NOW, THEREFORE, for good and adequate consideration, the receipt and sufficiency of which is hereby acknowledged, Assignor hereby assigns, and further hereby quitclaims to Assignee, all rights, title and interest and Assignor may possess in and to the Service Mark throughout the world, together with the goodwill symbolized by said Service Mark, concurrent with the transfer of certain tangible assets as indicia of said goodwill pursuant to the transactions contemplated by the Asset Purchase Agreement. Executed at San Diego, California this 5th day of November, 1998. On behalf of REALBID LLC, a California limited liability company By: /s/ ROBERT A. POTTER ---------------------------------------- Robert A. Potter, Manager By: /s/ EMMETT DeMOSS ---------------------------------------- Emmett DeMoss, Manager SCHEDULE A ---------- Service Mark Application Number - ------------ ------------------ REALBID 75/277,110 ACKNOWLEDGEMENT STATE OF CALIFORNIA ) ) ss. COUNTY OF MARIN ) On this 5th day of November, in the year 1998, before me, the undersigned Notary Public, duly commissioned and sworn, personally appeared Robert A. Potter and Emmett DeMoss personally known to me (or proved to me on ---------------------- the basis of satisfactory evidence) to be the person whose names are subscribed to the within instrument and acknowledged to me that they respectively execute the same in their authorized capacities, and that by their signatures on the instrument the persons executed the instrument. IN WITNESS WHEREOF, I have hereunder set my hand and affixed my official seal the day and year in this certificate above written. [SEAL] /s/ TROY L. SWANN -------------------------------------- Notary Public in and for the aforesaid County and State EX-10.42 45 ASSET PURCHASE AGMT DATED 7/17/95 EXHIBIT 10.42 ASSET PURCHASE AGREEMENT BETWEEN COMPS INFOSYSTEMS, THE LAND SALES RESOURCE AND KITTY LAYNE JULY 17, 1995 TABLE OF CONTENTS 1. PURCHASE AND SALE OF ASSETS....................................... 2 ---------------------------- 1.1 Transfer of Assets........................................... 2 ------------------ 1.2 Assumption of Liabilities.................................... 3 ------------------------- 1.3 Purchase Price............................................... 3 -------------- 1.4 Allocation of Asset Price.................................... 3 ------------------------- 1.5 Prorations................................................... 3 ---------- 1.6 Sales Taxes.................................................. 4 ----------- 2. CLOSING............................................................ 4 ------- 2.1 Closing...................................................... 4 ------- 2.2 Conveyances at Closing....................................... 4 ---------------------- 2.3 Form of Instruments.......................................... 5 ------------------- 2.4 Additional Documents and Information......................... 5 ------------------------------------ 3. REPRESENTATIONS AND WARRANTIES OF LSR AND LAYNE.................... 5 ----------------------------------------------- 3.1 Organization of LSR.......................................... 5 ------------------- 3.2 Authorization................................................ 6 ------------- 3.3 No Conflict or Violation..................................... 6 ------------------------ 3.4 Consent and Approvals........................................ 6 --------------------- 3.5 Absence of Certain Changes or Events......................... 6 ------------------------------------ 3.6 Purchased Assets............................................. 7 ---------------- 3.7 Real Property................................................ 7 ------------- 3.8 Equipment Lease.............................................. 9 --------------- 3.9 Financial Statements......................................... 9 -------------------- 3.10 Litigation................................................... 9 ---------- 3.11 Liabilities.................................................. 10 ----------- 3.12 Compliance with Law.......................................... 10 ------------------- 3.13 No Brokers................................................... 10 ---------- 3.14 No Other Agreements to Sell the Assets....................... 10 -------------------------------------- 3.15 Tax Matters.................................................. 11 ----------- 3.16 Employment Matters and Benefit Plans......................... 11 ------------------------------------ 3.17 Insurance.................................................... 12 --------- 3.18 Purchase Commitments and Outstanding Bids.................... 13 ----------------------------------------- 3.19 Transactions with Certain Persons............................ 13 --------------------------------- 3.20 Environmental Quality........................................ 14 --------------------- 3.21 Hazardous Conditions......................................... 14 -------------------- 3.22 Adequacy of Purchased Assets................................. 14 ---------------------------- 3.23 Material Misstatements or Omissions.......................... 14 ----------------------------------- 4. REPRESENTATIONS AND WARRANTIES OF COMPS --------------------------------------- 4.1 Organization of COMPS........................................ 14 --------------------- 4.2 Authorization................................................ 14 ------------- 4.3 No Conflict or Violation..................................... 15 ------------------------ 4.4 Consent and Approvals........................................ 15 --------------------- 5. COVENANTS OF LSR AND COMPS......................................... 16 -------------------------- 5.1 Maintenance of Business Prior to Closing..................... 16 ---------------------------------------- 5.2 Key Employees................................................ 16 ------------- 5.3 Investigation by COMPS; Audits............................... 17 ------------------------------ 5.4 Notification of Certain Matters.............................. 18 ------------------------------- 5.5 No Mergers, Consolidations, Sale of Stock, Etc............... 18 ---------------------------------------------- 6. CONDITIONS TO LSR'S AND LAYNE's OBLIGATIONS........................ 19 ------------------------------------------- 6.1 Representations, Warranties and Covenants.................... 19 ----------------------------------------- 6.2 No Governmental Proceedings or Litigation.................... 19 ----------------------------------------- 6.3 Certificates................................................. 19 ------------ 7. CONDITIONS TO COMP's OBLIGATIONS................................... 20 -------------------------------- 7.1 Representation, Warranties and Covenants..................... 20 ---------------------------------------- 7.2 No Governmental Proceedings or Litigation.................... 20 ----------------------------------------- 7.3 Opinion of Counsel........................................... 20 ------------------ 7.4 Certificates................................................. 20 ------------ 7.5 Conveyancing Documents....................................... 20 ---------------------- 8. COVENANT NOT TO COMPETE............................................ 20 ----------------------- 9. ACTIONS BY LSR AND COMPS AFTER THE CLOSING ------------------------------------------ 9.1 Books and Records............................................ 20 ----------------- 9.2 Survival of Representations.................................. 20 --------------------------- 9.3 Indemnification.............................................. 21 --------------- 9.3.1 By LSR and Layne..................................... 21 ---------------- 9.3.2 By COMPS............................................. 21 -------- 9.3.3 Assistance........................................... 21 ---------- 9.3.4 Defense of Claims.................................... 22 ----------------- 9.3.5 COMPS's Right of Offset.............................. 23 ----------------------- 9.3.6 Damages.............................................. 23 ------- 10. MISCELLANEOUS ------------- 10.1 Termination.................................................. 24 ----------- 10.2 Risk of Loss................................................. 24 ------------ 10.2.1 Personal Property.................................... 25 ----------------- 10.2.2 Leased or Owned Real Property........................ 25 ----------------------------- 10.3 Notices...................................................... 26 ------- 10.4 Choice of Law................................................ 26 ------------- 10.5 Entire Agreement; Amendments and Waivers..................... 27 ---------------------------------------- 10.6 Counterparts................................................. 27 ------------ 10.7 Expenses..................................................... 27 -------- 10.8 Invalidity................................................... 27 ---------- 10.9 Arbitration and Venue........................................ 27 --------------------- 10.10 Public Announcements......................................... 28 -------------------- 10.11 Construction................................................. 28 ------------ 10.12 Section and Other Headings................................... 25 -------------------------- 10.13 Schedules and Exhibits Not Attached.......................... 28 ----------------------------------- ASSET PURCHASE AGREEMENT ------------------------ This Asset Purchase Agreement, dated July 17, 1995, is by and between COMPS InfoSystems, Inc., a Delaware corporation ("COMPS"), The Land Sales Resource, an Illinois corporation ("LSR"), and Kitty Layne ("Layne"). RECITALS -------- A. LSR is engaged in the business of gathering information on the real estate industry in the Chicago area and compiling and selling that information in various forms. LSR owns certain assets (the "Assets") which it uses in the conduct of its business (the "Business"). B. COMPS also is engaged in the information systems business and operates in many locations throughout the United States. It is the intention of COMPS to enter the Chicago market and COMPS desires to purchase the Business. C. The shareholders of LSR and their percentage ownership are: Kitty Lane 65% Mark Fogarty 20% Joe Lyng 15% D. In order to induce COMPS to enter into this Agreement, LSR and Layne desire to grant COMPS a covenant not to compete and provide certain other assurances. E. Terms used herein which are not otherwise defined in context and the initial letters of which are capitalized shall have the definitions set forth in Appendix I. AGREEMENT --------- NOW THEREFORE, in consideration of the mutual covenants and promises contained herein and for other good and valuable consideration. the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: 1. PURCHASE AND SALE OF ASSETS --------------------------- 1.1 Transfer of Assets. On the Closing Date, LSR will sell, convey, ------------------ transfer, assign, and deliver to COMPS, and COMPS will acquire from LSR, effective as of 12:01 a.m. local time on the Closing Date (the "Closing Time"), all of LSR's assets of every nature and kind, except as provided in Schedule 1.1, (the "Purchased Assets"), both real and personal, including, without limitation: 1.1.1 customer lists, real estate information database, formats, customer data, and customer subscription agreements all as more particularly described on Schedule 1.1. 1 1.1.2 a lease for space located at 622 Executive Dr. Willowbrook, IL., true and correct copy of which is attached as Exhibit 1.1.2 (the "Real Property Lease"); 1.1.3 A personal property lease for an office copier described in Exhibit 1.1.3 (the "Equipment Lease"). 1.1.4 all patents, trade names, trademarks, logos, copyrights and applications therefor used or held for use in connection with the Business, as described on Schedule 1.1.4 hereto (the "Intellectual Property Rights"); 1.1.5 all leasehold improvements; 1.1.6 all machinery, equipment, furniture, fixtures, vehicles, office equipment, supplies, tools, inventory, and parts used or held for use in the Business, all of which are listed on Schedule 1.1.6; 1.1.7 all rights under contracts and agreements related to the Business; 1.1.8 accounts receivable, cash on hand, all prepaid items, deposits, advance payments, rights to offset and credits of all kinds of LSR; 1.1.9 Copies of all of the Books and Records of the Business; 1.1.10 all goodwill of the Business; 1.1.11 all manufacturer, supplier or contractor warranties or guaranties respecting any Purchased Assets; and 1.1.12 all other assets, tangible or intangible, used currently in the Business or necessary for the operation of the Business in the ordinary course and consistent with past practice; 1.2 Assumption of Liabilities. COMPS shall assume no liabilities of LSR ------------------------- of any sort whatsoever except for those obligations and liabilities set forth on Schedule 1.2. 1.13 Purchase Price. The purchase price for the assets (the "Asset -------------- Price") shall be $275,000 to be paid at Closing, in cash, by certified check or other immediately available funds. 1.4 Allocation of Asset Price. The Asset Price shall be allocated among ------------------------- the Purchased Assets as set forth on Schedule 1.4. COMPS and LSR agree that each shall report the transfers contemplated by this Agreement in a manner consistent with such 2 allocation including without limitation, compliance with the requirements of Section 1060 of the Code and the regulations thereunder. 1.5 Prorations. On the Closing Date, or as promptly as practicable ---------- following the Closing Date, the rents, real property taxes, water, gas, electricity and other utilities, common area maintenance reimbursements to lessors and other similar periodic charges payable with respect to the Real Property shall be prorated between COMPS and LSR effective as of the Closing Date. To the extent practicable, utility meter readings for LSR's facilities shall be determined as of the Closing Date. If the real property tax rate for the current tax year is not established by the Closing Date, the prorations shall be made on the basis of the rate in effect for the preceding tax year and shall be adjusted when the exact amounts are determined. All such prorations shall be based upon the most recent available assessed value of any facility prior to the Closing Date. 1.6 Sales Taxes. COMPS shall pay any sales taxes imposed by reason of the ----------- purchase by COMPS of the Purchased Assets pursuant to this Agreement. 2. CLOSING ------- 2.1 Closing. The Closing of the purchase and sale of assets contemplated ------- herein (the "Closing") shall be held at 10:00 A.M. local time on July 31, 1995 (the "Closing Date") at the offices of The Land Sales Resources, 622 Executive Drive, Willowbrook, Illinois, unless extended by either party for a period not to exceed 60 days unless the parties hereto otherwise agree. 2.2 Conveyances at Closing. To effect the transaction contemplated by ---------------------- this Agreement, on the Closing Date 2.2.1 LSR will execute and deliver to COMPS: (a) an Assignment and Assumption Agreement in the form attached hereto as Exhibit 2.2.1(1) conveying in the aggregate all of LSR's owned personal property included in the Purchased Assets to COMPS; (b) an assignment of Real Property Lease together with the consent of the landlord in the form attached hereto as Exhibit 2.2.1(2); (c) an assignment of the Equipment Lease together with the consent of the lessor in the form attached hereto as Exhibit 2.2.1(3); (d) such other instruments as shall be reasonably requested by COMPS to vest in COMPS good and marketable title in and to all of the Purchased Assets in accordance with the provisions hereof. 2.2.2 COMPS shall deliver to LSR and/or Layne (a) the Asset Price; 3 (b) the Assignment and Assumption Agreement attached as Exhibit 2.2.1(1); (c) the employment agreements referred to in Section 5.2.1.; (d) the option agreements referred to in Section 5.2.1 2.3 Form of Instruments. To the extent that a form of any document to be ------------------- delivered hereunder is not attached as an Exhibit hereto, all the foregoing instruments shall be in form and substance, and shall be executed and delivered in a manner reasonably satisfactory to counsel for the parties. 2.4 Additional Documents and Information. COMPS and LSR shall, on ------------------------------------ request, on or after the Closing Date, cooperate with one another by furnishing any additional information, executing and delivering any additional documents and/or instruments, and by doing any and all such other things as may be reasonably required by the parties or their counsel to consummate or otherwise implement the transactions contemplated by this Agreement. 3. REPRESENTATIONS AND WARRANTIES OF LSR AND LAYNE. LSR and Layne hereby ----------------------------------------------- represent and warrant to COMPS as of the date hereof, and as of Closing, as follows: 3.1 Organization of LSR. LSR is a corporation duly organized, validly ------------------- existing and in good standing under the laws of the State of Illinois, has full corporate power and authority to conduct its business as it is presently being conducted and to own and lease its properties and assets. LSR is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which such qualification is necessary under the applicable law as a result of the conduct of its business or the ownership of its properties and where the failure to be so qualified, singly or in the aggregate, would have a material adverse effect on the business or financial condition of LSR. Each jurisdiction, if any, in which LSR is qualified to do business as a foreign corporation is listed on the Disclosure Schedule. 3.2 Authorization. LSR has all necessary corporate power and authority ------------- and has taken all corporate action necessary, and Layne has all necessary power and authority, to enter into this Agreement, to consummate the transactions contemplated hereby and to perform their respective obligations hereunder. This Agreement has been duly executed and delivered by each of LSR and Layne, and is a legal, valid and binding obligation enforceable against LSR and Layne in accordance with the terms except as such enforceability may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other similar jaws, or by equitable principles, relating to or limiting the rights of creditors generally and (b) limitations imposed by law or equitable principles upon the availability of specific performance, injunctive relief or other equitable remedies. 3.3 No Conflict or Violation. Except as described in the Disclosure ------------------------ Statement, neither the execution and delivery of this Agreement nor the consummation of 4 the transactions contemplated hereby will result in (a) a violation of or a conflict with any provision of any of LSR's charter documents; (b) a breach of, or a default under, or constitute a basis for terminating any term or provision of any contract, agreement, indebtedness, lease to which LSR is a party or by which the Purchased Assets are bound; (c) a violation by LSR of any law, order or judgment; or (d) an imposition of any Encumbrance, restriction or charge on the Business or on any of the Purchased Assets. 3.4 Consents and Approvals. Except as set forth on the Disclosure ---------------------- Schedule, no consent, approval or authorization of, or declaration, filing or registration with, any governmental or regulatory authority, or any other person or entity, is required to be had or obtained by LSR or Layne in connection with the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby. 3.5 Absence of Certain Changes or Events. Since the Balance Sheet Date, ------------------------------------ there has not been any: 3.5.1 change in LSR's condition (financial or otherwise), assets, liabilities, working capital, reserves, earnings, business or prospects, except for changes which have not, individually or in the aggregate, been materially adverse, and neither LSR nor Layne knows of any developments in the Business which could reasonably be expected to have a material adverse affect on the condition (financial or otherwise), earnings, business or prospects of the Business; 3.5.2 failure to operate the Business in the ordinary course so as to use LSR's best efforts to preserve the business intact and to preserve for COMPS the goodwill of LSR's suppliers, customers and others having business relations with LSR; 3.5.3 change in accounting methods or practices by LSR affecting its assets, liabilities or business; 3.5.4 sale, assignment or transfer of any of the assets or properties of LSR, other than in the ordinary course of business, consistent with past practice; or 3.5.5 any other event or condition which in any one case or in the aggregate has or might reasonably be expected to have a material adverse effect on the condition (financial or otherwise), earnings, business or prospects of the Business. 3.6 Purchased Assets. LSR has good and marketable title to the Purchased ---------------- Assets and, upon the consummation of the transactions contemplated hereby, COMPS will acquire good title to the Purchased Assets, free and clear of any Encumbrance of any sort whatsoever. 3.7 Real Property. LSR owns no Real Property. ------------- 3.7.1 Real Property Lease. The Real Property Lease is the only ------------------- lease, sublease or other occupancy agreement pursuant to which LSR occupies or uses real property in connection with the Business; with respect to the Real Property Lease: 5 3.7.2 LSR has in all material respects performed all the obligations required to be performed by it through the date hereof with respect thereto. The Real Property Lease is not in default, is in full force and effect and LSR enjoys peaceful and undisturbed possession of all the property covered by the Real Property Lease; 3.7.3 LSR has and will transfer to COMPS at the Closing an unencumbered interest in the Real Property Lease, which lease is freely assignable by LSR to COMPS pursuant to this Agreement without any further action except for the consent of the landlord including, without limitation, the consent of, or payment of money or giving of notice to, any party; 3.7.4 To the best of LSR and Layne's knowledge, all facilities leased thereunder have received all material approvals of governmental authorities (including licenses and permits and a certificate of occupancy or other evidence of lawful occupancy of the leased property) required in connection with the operation thereof, and have been operated and maintained in all material respects in accordance with applicable laws, rules and regulations; 3.7.5 The facilities leased thereunder are supplied with utilities (including water, sewage, disposal, electricity, gas and telephone) and other services necessary for the operation of such facilities as currently operated; 3.7.6 To the best of LSR and Layne's knowledge, there are no pending or threatened condemnation proceedings with respect to the property leased pursuant to the Real Property Lease, or pending or threatened litigation or administrative actions relating thereto; 3.7.7 There are no subleases, licenses, options, rights, concessions or other agreements or arrangements, written or oral, granting to any person the right to use or occupy such property leased pursuant to any Real Property Lease, or any portion thereof or interest therein; 3.7.8 The improvements constructed on the leased property are in good operating condition and repair and, to the best of LSR and Layne's knowledge, they are without any material structural or mechanical defects of any kind; and 3.7.9 LSR has not received notice of any special assessment relating to the leased property and has no knowledge of any pending or threatened special assessment. 3.8 Equipment Lease. The Equipment Lease is the only lease or other --------------- agreement pursuant to which LSR utilizes personal property in connection with the Business. With respect to the Equipment Lease: 3.8.1 LSR has in all material respects performed all the obligations required to be performed by it through the date hereof with respect thereto. The Equipment Lease is not in default, is in full force and effect and LSR enjoys peaceful and undistributed possession of all the property covered by the Equipment Lease; 6 3.8.2 LSR has and will transfer to COMPS at the Closing an unencumbered interest in the Equipment Lease, which lease is freely assignable by LSR to COMPS pursuant to this Agreement without any further action except for the consent of the Lessor including, without limitation, the consent of, or payment of money or giving of notice to, any party; 3.8.3 There are no subleases, licenses, options, rights concessions or other agreements or arrangements, written or oral, granting to any person the right to use property leased pursuant to any Equipment Lease, or any portion thereof or interest therein. 3.9 Financial Statements. LSR has heretofore delivered to COMPS the -------------------- Financial Statements. The Financial Statements (i) are true, correct and complete, (ii) are in accordance with the books and records of LSR, (iii) have been examined by Roche, Scholz, Roche, Walsh, LTD, independent certified public (iv) have been prepared in conformity with generally accepted accounting principles consistently applied throughout the periods covered thereby and (v) fairly and accurately present the consolidated assets, liabilities and financial position of LSR as of the date thereof and the consolidated results of operations and changes in cash flows for the periods then ended. 3.10 Litigation. There is no action, order, writ, injunction, judgment, ---------- decree, claim, suit, litigation, proceeding, labor dispute, arbitral action, investigation or similar dispute of any sort whatsoever (collectively, "Actions") outstanding or pending or, to the best knowledge of LSR and Layne, threatened or anticipated against, relating to or affecting (i) LSR, (ii) any benefit plan for employees of LSR or any fiduciary or administrator thereof, (iii) Layne, or (iv) the transactions contemplated by this Agreement. LSR is not in default with respect to any judgment, order, writ, injunction or decree of any court or governmental agency, and there are no unsatisfied judgments against LSR or its business or activities. 3.11 Liabilities. LSR has no liabilities or obligations (absolute, ----------- accrued, contingent or otherwise), which may have an effect on this transaction, except (i) liabilities which are reflected and reserved against on the Balance Sheet or (ii) Liabilities incurred in the ordinary course of business and consistent with past practice since the Balance Sheet Date. 3.12 Compliance with Law. LSR and the Business are in compliance with all ------------------- applicable laws, statutes, ordinances and regulations, whether federal, state or local, except where the failure to comply would not have a material adverse effect on the business, condition (financial or otherwise) or prospects of LSR. LSR has not received any written notice to the effect that, or otherwise been advised that, it is not in compliance with any of such statutes, regulations, orders, ordinances or other laws where the failure to comply would have a material adverse effect on the business, condition (financial or otherwise) or prospects of LSR, and LSR has no reason to anticipate that any presently existing circumstances are likely to result in violations of any such regulations which would, in any one case or in the aggregate, have a material adverse effect on the business, condition (financial or otherwise) or prospects of LSR. 7 3.13 No Brokers. Neither LSR, Layne nor any other affiliate of LSR has ---------- paid, nor incurred any obligation to pay, any finder's fee, brokerage commission or similar payment of any sort whatsoever in connection with the transactions contemplated by this Agreement. 3.14 No Other Agreements to Sell the Assets. Neither LSR, Layne nor any -------------------------------------- other affiliate or Representative of LSR has any obligation, absolute or contingent, to any other person or firm to sell or encumber the Purchased Assets, to sell capital stock of LSR or to effect any merger, consolidation or other reorganization of LSR or to enter into any agreement with respect thereto, nor has any such party had any discussion with any third party regarding any of the foregoing. 3.15 Tax Matters. ----------- 3.15.1 LSR is an S Corporation. LSR, any predecessor of LSR and all members for income tax purposes of any affiliated group of corporations of which LSR or any such predecessor corporation is or has been a member (collectively, the "Taxpayers") have duly filed all tax reports and returns required to be filed by them, including all federal, state, local and foreign tax returns and reports. The Taxpayers have paid in full all taxes required to be paid by such Taxpayers before such payment became delinquent. LSR has made adequate provision, in conformity with generally accepted accounting principles consistently applied, for the payment of all taxes which may subsequently become due. All taxes which any Taxpayer has been required to collect or withhold have been duly collected or withheld and, to the extent required when due, have been or will be duly paid to the proper taxing authority. 3.15.2 The consolidated federal income tax returns of LSR and the federal income tax returns of each subsidiary of LSR whose results of operations are not consolidated in the federal income tax returns of LSR, have never been examined by the Internal Revenue Service. There are no audits known by LSR to be pending of LSR's tax returns, and there are no claims which have been or may be assorted relating to any of LSR's tax returns filed for any year which if determined adversely would result in the assertion by any governmental agency of any deficiency. There have been no waivers of statutes of limitations by LSR. 3.15.3 For the purpose of this Agreement, any federal, state local or foreign income, sales, use, transfer, payroll, personal property, occupancy or other tax, levy, impost, fee, imposition, assessment or similar charge, together with any related addition to tax, interest or penalty thereon, is referred to as a "Tax." 3.16 Employment Matters and Benefit Pans ------------------------------------ 3.16.1 Except as disclosed on the Disclosure Schedule, LSR has no obligation of any sort whatsoever pursuant to or in connection with any Employment Agreement or Employee Plan. All obligations to employees in respect of vacation, sick leave and other benefits are described in detail in Exhibit 1.2 8 3.16.2 Since the Balance Sheet Date there has not been any (i) increase in the compensation payable or to become payable by LSR to any of its officers, employees or agents (collectively, "Personnel") whose total compensation for services rendered to LSR is currently at an annual rate of more than $20,000, except for normal periodic increases in the ordinary course of business consistent with past practice, (ii) any bonus, incentive compensation, service award or other like benefit granted, made or accrued, contingently or otherwise, for or to the credit of any of the Personnel, (iii) any employee welfare, pension, retirement, profit-sharing or similar payment or arrangement made or agreed to by LSR for any Personnel except pursuant to the existing plans and arrangements described in the Disclosure Schedule, (iv) any new Employment Agreement to which LSR is a party; or (vi) addition to or modification of the employee benefit plans, arrangements or practices described in the Disclosure Schedule affecting Personnel. 3.16.3 At the option of COMPS, certain employee of LSR shall become employees of LSR-COMPS division. Immediately prior to the Closing, LSR shall terminate all of those employees who are to transfer to LSR-COMPS division and shall retain all liabilities in respect of such employees. At the Closing COMPS shall immediately hire so many of those employees as it shall, in its sole discretion, determine without the assumption of any prior obligation to such employees. COMPS makes no representation that any specific benefit will be maintained upon its hiring LSR employees and expressly reserves the right to alter the nature and/or amount of any or all of such benefits as a condition to hiring such employees. 3.17 Insurance. The Disclosure Schedule contains a complete and accurate --------- list of all policies or binders of fire, liability, title, worker's compensation and other forms of insurance (showing as to each policy or binder the carrier, policy number, coverage limits, expiration dates, annual premiums and a general description of the type of coverage provided) maintained by LSR on its business, property or Personnel. Such insurance provides coverage to the extent and in the manner (a) customary for the industry in which LSR is engaged and (b) as may be required by law and by any and all contracts to which LSR is a party. LSR is not in default under any of such policies or binders, and LSR has not failed to give any notice or to present any claim under any such policy or binder in a due and timely fashion. There are no outstanding unpaid claims under any such policies or binders. All policies and binders provide sufficient coverage for the risks insured against, are in full force and effect on the data hereof and shall be kept in full force and effect by LSR with respect to all insured events occurring on or prior to the Closing Date. 3.18 Purchase Commitments and Outstanding Bids. Except as set forth on ----------------------------------------- the Disclosure Schedule, LSR has no pending or outstanding commitments, bids or proposals to purchase any goods or services. 3.19 Transactions with Certain Persons. Except as set forth on the --------------------------------- Disclosure Schedule, no officer, director or employee of LSR or any member of any such person's immediate family is presently a party to any transaction with LSR relating to LSR's business, including without limitation, any contract, agreement or other arrangement (i) 9 providing for the furnishing of services by, (ii) providing for the rental of real or personal property from, or (iii) otherwise requiring payments to (other than for services as officers, directors or employees of LSR) any such person or corporation, partnership, trust or other entity in which any such person has a substantial interest as a shareholder, officer, director, trustee or partner. 3.20 Environmental Quality. LSR has complied in all material respects with --------------------- all federal, state, and local environmental protection laws and regulations and have not been cited for any violation of any such law or regulation. No material capital expenditures will be required for compliance with any applicable federal, state, or local laws or regulations now in force relating to the protection of the environment. There is no pending audit known to LSR or Layne or any of their officers by any federal, state, or local governmental authority with respect to groundwater, soil, or air monitoring; the storage, burial, release, transportation, or disposal of hazardous substances; or the use of underground storage tanks by LSR or relating to the Facilities. Neither LSR nor Layne has any agreement with any third party or federal, state, or local governmental authority relating to any such environmental matter or any environmental cleanup. 3.21 Hazardous Conditions. There are no defective, unsafe or hazardous -------------------- conditions pertaining to the Purchased Assets or the locations in which any such Purchased Assets are installed or stored. 3.22 Adequacy of Purchased Assets. The Purchased Assets are in good ---------------------------- operating condition and repair (ordinary wear and tear excepted), are all of the assets used currently in the Business or necessary for the operation of the Business in the ordinary course and consistent with past practice, and are in conformity in all material respects with all applicable laws, ordinances, orders, relations and other requirements (including applicable zoning, environmental, motor vehicle safety or standards, occupational safety and health laws and regulations) relating thereto currently in effect, except where the failure to conform would not have a material adverse effect on the business, condition (financial or otherwise) or prospects of LSR. 3.23 Material Misstatements Or Omissions. No representations or ----------------------------------- warranties by LSR or Layne in this Agreement, nor any document, exhibit, statement, certificate or schedule furnished to COMPS pursuant hereto, or in connection with the transactions contemplated hereby, contain or will contain any untrue statement of a material fact, or omit or will omit to state any material fact necessary to make the statements or facts contained therein not misleading. LSR has disclosed all events, conditions and facts materially affecting the business, condition (financial or otherwise) or prospects of such LSR. 4. REPRESENTATION AND WARRANTIES OF COMPS. COMPS hereby represents and -------------------------------------- warrants to LSR as follows: 4.1 Organization of COMPS. COMPS is a corporation duly organized, validly --------------------- existing and in good standing under the laws of the State of Delaware, has full 10 corporate power and authority to conduct its business as it is presently being conducted and to own and lease its properties and assets. 4.2 Authorization. COMPS has all necessary corporate power and authority ------------- and has taken all corporate action necessary to enter into this Agreement, to consummate the transactions contemplated hereby and to perform its obligations hereunder. This Agreement has been duly executed and delivered by COMPS and is a legal, valid and binding obligation enforceable against COMPS in accordance with its terms except as such enforceability may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other similar laws, or by equitable principles, relating to or limiting the rights of creditors generally, and (b) limitations imposed by law or equitable principles upon the availability of specific performance, injunctive relief or other equitable remedies. 4.3 No Conflict or Violation. Neither the execution and delivery of this ------------------------ Agreement nor the consummation of the transactions contemplated hereby will result in (a) a violation of or a conflict with any provision of any of COMPS's charter documents; (b) a breach of, or a default under, or constitute a basis for terminating any term or provision of any contract, agreement, indebtedness or lease to which COMPS is a party or by which its assets are bound which breach or default would have a material adverse effect on the ability of COMPS to consummate the transactions contemplated hereby or (c) a violation by COMPS of any law, order or judgment. 4.4 Consent and Approvals. Except as set forth on Schedule 4.4 hereto, no --------------------- consent, approval or authorization of, or declaration, filing or registration with, any governmental or regulatory authority, or any other person or entity, is required to be made or obtained by COMPS in connection with the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby. 4.5 Capitalization and Rights. The authorized and outstanding capital ------------------------- stock of COMPS is as follows: Class Authorized Outstanding ----- ----------- ----------- A common 22,500,000 4,773,860 B common 2,500,000 0 Preferred 5,000,000 4,270,336 The preferred stock and the class B common stock are both convertible into class A common on a one to one basis. 4.6 No Brokers. Neither COMPS nor any affiliate of COMPS has paid nor ---------- incurred any obligation to pay, any finder's fee, brokerage commission or similar payment of any sort whatsoever in connection with the transactions contemplated by this Agreement. 4.7 Litigation. There is no action, order, writ, injunction, judgment, ---------- decree, claim, suit, litigation, proceeding, labor dispute, arbitral action, investigation or 11 similar dispute of any sort whatsoever outstanding or pending or, to the best knowledge of COMPS, threatened or anticipated against, relating to, affecting or which would have reasonable potential to obstruct or prevent the consummation of the transaction contemplated by this Agreement. 5. COVENANTS OF LSR AND COMPS. LSR and COMPS each covenant with the other as -------------------------- follows: 5.1 Maintenance of Business Prior to Closing. LSR shall continue to carry ---------------------------------------- on its business in ordinary course and in accordance with past practice to reserve the business intact and to preserve for COMPS the goodwill of LSR's suppliers, customers and others having business relations with it and will not take any action inconsistent therewith or with the consummation of the Closing. Without in any way limiting the generality of the foregoing, LSR agrees that from the date hereof through the Closing Date, (a) it shall conduct and schedule its cash collected on operations consistent with past practice, (b) maintain the Purchased Assets in their current state of repair, ordinary wear and tear excepted, (c) maintain the insurance coverages and (d) it shall not sell, assign or transfer any of its assets or properties other than in the ordinary course of business, consistent with past practice. 5.2 Key Employees. ------------- 5.2.1 Layne and Mark Fogarty ("Fogarty") shall agree to become employees of COMPS operating out of the Chicago office. Layne shall be the President of LSR-COMPS division and Regional Vice President of COMPS. Mr. Fogarty shall be the Systems Manager of LSR-COMPS division. Both Layne and Fogarty shall serve pursuant to the executive employment agreement of COMPS and each shall receive incentive stock options pursuant to COMPS" Incentive Stock Option Plan (the "Options") of the same type as those which are currently issued to other executives of COMPS. The form of employment agreement for Layne and Fogarty referred to above and the form of stock option agreement in respect of the Options for Layne and Fogarty referred to above are attached hereto as Exhibits 5.2.1A and 5.2.1B, respectively. 5.2.2 The Options shall be in respect of 75,000 shares to Layne and 15,000 shares to Fogarty and shall be exercisable at $.30 per share for a period of 5 years. The Options shall vest at the end of the first year following the closing and as to 15,000 shares for Layne and 3,000 shares for Fogarty and a similar number of shares each year thereafter for the next four years. 5.2.3 All options shall vest upon (a) the closing of any transaction in which all or substantially all of the assets of COMPS are sold to or COMPS is merged with an entity not owned or controlled by or under common control with COMPS; or (b) the effective date of a registration statement filed pursuant to the Securities Act of 1933, as amended, in respect of an underwritten public offering of the common shares of COMPS. 12 5.2.4 The parties acknowledge that the issuance of the Options and the underlying shares is subject to the requirements of state and federal securities laws. As a condition precedent to their issuance, Layne and Fogarty shall agree to such restrictions and other requirements as shall be necessary in order for COMPS to meet the requirements for exemption from registration or other qualification under the federal securities laws and under any applicable state securities laws. 5.3 Investigation by COMPS; Audits; ------------------------------ 5.3.1 LSR shall allow COMPS at its own expense during regular business hours to make such inspection of the Purchased Assets and to inspect and make copies of other contracts, Books and Records or information requested by COMPS and necessary for or reasonably related to the operation of the Business including historical financial information concerning the business and operations of LSR; provided, however, that any information obtained from LSR is -------- ------- subject to the confidentially agreement entered into and dated April 28, 1995. 5.3.2 COMPS intends to enter the real estate information market in the Chicago area in the very near future. It recognizes that despite the best efforts of the parties to consummate the transaction contemplated by this agreement, it may not be possible to complete the sale. This being the case and since COMPS wishes to avoid any possible question concerning its use of the proprietary information of LSR, COMPS does not intend to review LSR customer list nor LSR real estate information database in connection with its due diligence investigation nor will it review any of the proprietary techniques of LSR unless believes that a Closing is a certainty. However, COMPS reserves the right to make such an investigation and LSR agrees that if COMPS should make a specific written request to do so, it will assist COMPS to undertake the investigation in such a way that there can be no significant potential that COMPS could realistically be placed in a position to use LSR proprietary information in connection with its independent entry into the Chicago market. 5.4 Notification of Certain Matters. LSR shall give prompt notice to ------------------------------- COMPS, and COMPS shall give prompt notice to LSR, of (i) the occurrence, or failure to occur, of any event the occurrence or failure of which would be likely to cause any representation or warranty contained in this Agreement to be untrue or inaccurate any time from the date hereof to the Closing Date and (ii) any failure of LSR or COMPS, as the case may be, to comply or satisfy any covenant, condition or agreement to be complied with or satisfied by it hereunder. Each party shall use all reasonable efforts to remedy any failure on its part to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it hereunder. 5.5 No Mergers, Consolidations, Sale of Stock, Etc. Except for ---------------------------------------------- negotiations between Layne and Joe Lyng for the acquisition by Layne of the shares of LSR owned by Joe Lyng, neither LSR, Layne nor any other affiliate or Representative of LSR will, directly or indirectly, solicit any inquiries or proposals or enter into or continue any discussions, negotiations or agreements relating to the sale or exchange of its capital stock or the merger of LSR with, or any direct or indirect disposition of any amount of 13 LSR's assets or business to, any person other than COMPS or provide any assistance or any information to or otherwise cooperate with any person in connection with any such inquiry, proposal or transaction. In the event that LSR receives an unsolicited offer for such a transaction or obtains information that such an offer is likely to made, LSR will provide COMPS with notice thereof as soon as practical after receipt, including the identity of the prospective purchaser or soliciting party. 6. CONDITIONS TO LSR'S AND LAYNE's OBLIGATIONS. The obligations of LSR and ------------------------------------------- Layne to consummate the transactions provided for hereby are subject, in the reasonable discretion of LSR, to the satisfaction, on or prior to the Closing Date, of each of the following conditions: 6.1 Representations, Warranties and Covenants. All representations and ----------------------------------------- warranties of COMPS contained in this Agreement shall be true and correct at and as of the Closing Date and COMPS shall have performed all agreements and covenants required to be performed by it prior to or at the Closing Date. 6.2 No Governmental Proceedings or Litigation. No action by any ----------------------------------------- governmental authority shall have been instituted or threatened which questions the validity or legality of the transactions contemplated hereby and which could reasonably be expected materially to damage LSR if the transactions contemplated hereunder are consummated. 6.3 Certificates. COMPS will furnish LSR with such certificates of its ------------ officers and others to evidence compliance with the conditions set forth in this Section 6 as may be reasonably requested by LSR. 6.4 Delivery at the Closing. COMPS shall deliver to LSR the Asset Price ----------------------- comprised of the cash, certified check or other immediately available funds and the Note referred to in section ? and shall deliver to Layne and Fogarty the employment agreements and stock option agreements referred to in section 5.2.1 6.5 Opinion of Counsel. COMPS shall have delivered to LSR an opinion of ------------------ Monroe & Dostart counsel to COMPS, dated as of the Closing Date, in form and substance satisfactory to LSR, to the effect that: [To Come]. 7. CONDITIONS TO COMPS's OBLIGATIONS. The obligations of COMPS to consummate --------------------------------- the transactions provided for hereby are subject, in the reasonable discretion of COMPS, to the satisfaction, on or prior to the Closing Date, of each of the following conditions: 7.1 Representations, Warranties and Covenants. All representations and ----------------------------------------- warranties of LSR and Layne contained in this Agreement shall be true and correct at and as of the Closing Date and LSR shall have performed all agreements and covenants required to be performed by it prior to or at the Closing Date. 7.2 No Governmental Proceedings or Litigation. No action by any ----------------------------------------- governmental authority shall have been instituted or threatened which questions the 14 validity or legality of the transactions contemplated hereby and which could reasonably be expected materially to damage COMPS if the transactions contemplated hereunder are consummated. 7.3 Opinion of Counsel. LSR shall have delivered to COMPS an opinion of ------------------ Burke, Warren and MacKay, counsel to LSR, dated as of the Closing Date, in form and substance satisfactory to COMPS, to the effect that: [To Come]. 7.4 Certificates. LSR will furnish COMPS with such certificates of its ------------ officers and others to evidence compliance with the conditions set forth in this Section 7 as may be reasonably requested by COMPS. 7.5 Conveyancing Documents. LSR shall have executed and delivered each of ---------------------- the documents described in Section 2.2 so as to effect the transfer and assignment to COMPS of all right, title and interest in and to the Purchased Assets. 8. COVENANT NOT TO COMPETE. As an inducement for COMPS to enter into this ----------------------- Agreement, each of LSR and Layne shall execute and deliver to COMPS a three-year covenant not to compete in the form attached as Exhibit 8. 9. ACTION BY LSR AND COMPS AFTER THE CLOSING ------------------------------------------ 9.1 Books and Records. Each party agrees that it will cooperate with and ----------------- make available to the other party, during normal business hours, all Books and Records, information and employees retained and remaining in existence after the Closing Date which are necessary or useful in connection with any tax inquiry, audit, investigation or dispute, any litigation or investigation or any other matter requiring any such Books and Records, information or employees for any reasonable business purpose. The party requesting any such Books and Records, information or employees shall bear all of the out-of-pocket costs and expenses reasonably incurred in connection with providing such Books and Records, information or employees. 9.2 Survival of Representations. The representations and warranties of --------------------------- COMPS, LSR and Layne contained herein shall survive the Closing Date until the date that is 18 months following the Closing Date, without regard to any investigation made by any of the parties hereto. 9.3 Indemnification. --------------- 9.3.1 By LSR and Layne. LSR and Layne shall, jointly and severally, ---------------- indemnify, save and hold harmless COMPS, its affiliates and its and their respective Representatives, from and against any and all Damages, incurred in connection with, arising out of, resulting from or incident to (i) any breach of any covenant, representation, warranty or agreement or the inaccuracy of any representation, made by LSR and Layne in or pursuant to this Agreement; or (ii) any liability, obligation or commitment of any nature (absolute, accrued, contingent or otherwise) of LSR and Layne and relating to the Business and arising out of transactions entered into or events occurring prior to the Closing. 15 9.3.2 By COMPS. COMPS shall indemnify and save and hold harmless LSR -------- and Layne, its affiliates and subsidiaries, and its and their respective Representatives from and against any and all Damages incurred in connection with or arising out of or resulting from any (i) breach of any covenant or warranty, or the inaccuracy of any representation, made by COMPS in or pursuant to this Agreement or (ii) any liability, obligation or commitment of any nature (absolute, accrued, contingent or otherwise) relating to the Business and arising out of transactions entered into or events occurring subsequent to the Closing. 9.3.3 Assistance. The parties shall cooperate with one another in ---------- all reasonable respects, at their own cost, risk and expense, in the investigation, prosecution, trial, and defense of any lawsuit, claim, proceeding, arbitration or action that is subject to indemnification hereunder. 9.3.4 Defense of Claims. If any lawsuit or enforcement action is ----------------- filed against any party entitled to the benefit of indemnity hereunder, written notice thereof shall be given to the indemnifying party as promptly as practicable (and in any event within fifteen (15) days after the service of the citation or summons); that the failure of any indemnified party to give timely notice shall not affect rights to indemnification hereunder except to the extent that the indemnifying party demonstrates actual damage caused by such failure. After such notice, if the indemnifying party shall acknowledge in writing to the indemnified party that the indemnifying party shall be obligated under the terms of its indemnity hereunder in connection with such lawsuit or action, then the indemnifying party shall be entitled, if it so elects, to take control of the defense and investigation of such lawsuit or action and to employ and engage attorneys of its own choice to handle and defend the same, at the indemnifying party's cost, risk and expense unless (i) the indemnifying party has failed to assume the defense of such action or proceeding or (ii) the named parties to such action or proceeding include both of the indemnifying party and the indemnified party and the indemnified party has been advised in writing by counsel that there may be one or more legal defenses available to such indemnified party that are different from or additional to those available to the indemnifying party, and to compromise or settle such claim, which compromise or settlement shall be made only with the written consent of the indemnifying party, such consent not to be unreasonably withheld. If the indemnifying party fails to assume the defense of such claim within 15 days after receipt of notice of the claim pursuant to this Section 9.3, the indemnified party against which such claim has been asserted will (upon delivering notice to such effect to the indemnifying party) have the right to undertake, at the indemnifying party's cost and expense, the defense, compromise or settlement of such claim on behalf of and for the account and risk of the indemnifying party; that such claim shall not be compromised or settled without the written consent of the indemnifying party, which consent shall not be unreasonably withheld. In the event the indemnified party assumes defense of the claim, the indemnified party will keep the indemnifying party reasonably informed of the progress of any such defense, compromise or settlement. The indemnifying party shall be liable for any settlement of any action effected pursuant to and in accordance with this Section 9.3 and for any final judgment (subject to any right of appeal), and the indemnifying party agrees to indemnify and hold 16 harmless an indemnified party from and against any Damages by reason of such settlement of judgment. 9.3.5 COMPS Right of Offset. --------------------- (a) Anything in this Agreement to the Contrary notwithstanding, COMPS may withhold from any amount which COMPS is obligated to indemnify LSR and/or pursuant to any provision of this Section 9.3, an amount equal to any Damages which it deems to be due to it from LSR and/or Layne (but may not exercise a right of offset except as provided in subsection (b), below). (b) COMPS shall have the right to exercise an offset against any amount which it has with held as provided above if (l) there is no dispute as to the amount due; (2) LSR and Layne agree to the offset; or (3) any controversy concerning the amount due is arbitrated in accordance with Section 10.9 and resolved in favor of COMPS. 9.3.6 Damages. The term "Damages" as used in this Section 9.3 shall ------- mean all costs, losses (including, without limitation, diminution in value), Taxes, diminutions in value, liabilities, damages, lawsuits, deficiencies, claims and expenses (whether or not arising out of third-party claims), including without limitation, interest, penalties, costs of mitigation, clean-up or remedial action, lost profits and other losses resulting from any shutdown or curtailment of operations, damages to the environment, attorneys" fees and all amounts paid in investigation, defense or settlement of any of the foregoing. Damages are not limited to matters asserted by third parties against LSR and Layne or COMPS, but include Damages incurred or sustained by LSR and Layne or COMPS in the absence of third party claims. Payments by LSR and Layne or COMPS of amounts for which they are indemnified hereunder shall not be a condition precedent to recovery. The parties" obligation to indemnify one another shall not limit any other rights, including without limitation, rights of contribution they may have with respect to each other under statute or common law. 9.4 Single Family Residence Data. After the Closing, COMPS proposes to ---------------------------- sell that portion of the Business which currently provides single family residence data to Market Data Center, Inc. If it can be sold as a unit/system to Market Data Center, Inc. or REIC or some other person or entity, the net proceeds of the sale will be shared 50% with LSR. 10. MISCELLANEOUS. ------------- 10.1 Termination. This Agreement may be terminated at any time prior to ----------- Closing: (a) by LSR, if any condition precedent to LSR's obligations hereunder is not satisfied and such condition is not waived by LSR at or prior to the Closing Date; 17 (b) by COMPS, if any condition precedent to COMPS's obligations hereunder is not satisfied and such condition is not waived by COMPS at or prior to the Closing Date; (c) by either party, in the event the Closing has not taken place by sixty days from the date specified in Section 2.1 as the Closing Date; in which case, COMPS or LSR, as the case may be, may terminate this Agreement at its option by notice to the other party. In the event of the termination of this Agreement by either party as above provided, neither party shall have any liability hereunder of any nature whatsoever to the other party, including any liability for damages, unless either party is in default under its obligations hereunder, in which event the party in default shall be liable to the other party for such default. In the event that a condition precedent to its obligations is not satisfied, nothing contained herein shall be deemed to require any party to terminate this Agreement, rather than to waive such condition precedent and proceed with the Closing. 10.2 Risk of Loss. ------------ 10.2.1 Personal Property. Until the Settlement Time, all risk of ----------------- loss or damage to the personal property included in the Purchased Assets shall be borne by LSR, and thereafter shall be borne by COMPS. If any material portion of such personal property is destroyed or damaged by fire or any other cause prior to the Settlement Time, LSR shall promptly give notice to COMPS of such damage or destruction and the amount of insurance, if any, covering said personal property. Prior to the Settlement Time, COMPS may exclude said property from this Agreement by providing notice as soon as possible, but not less than 24 hours prior to the Closing Date, in which event the Asset Price shall be reduced by the amount allocated to such damaged or destroyed property, as mutually agreed between the parties. After the Settlement Time, any such insurance proceeds shall belong, and to the extent necessary shall be assigned, to COMPS without any reduction in the Asset Price. 10.2.2 Leased or Owned Real Property. If after the Settlement Time, ----------------------------- there is any fire, other casualty loss or condemnation (a "Destruction") affecting any of the facilities covered by the Real Property Lease, the risk of loss of such property shall be borne by COMPS, and any insurance proceeds with respect to such property shall belong to COMPS, without any reduction in the Asset Price. If between the date hereto and the Settlement Time there is any Destruction affecting any of the facilities covered by the Real Property Lease, then: (a) COMPS may refuse to accept any such property, and this Agreement shall be terminated as to said property, unless LSR agrees to restore ------ or repair such destroyed or damaged property in which latter event any insurance proceeds shall be retained by LSR and LSR shall complete said repairs and restoration within a reasonable time not to exceed nine (9) months after the date upon which LSR notified COMPS of its election to repair or restore said property pursuant to this Section. 18 (b) If, pursuant to this Section, this Agreement is terminated with respect to any of the facilities covered by the Real Property Lease, the parties hereto shall be relieved of any further obligations or liabilities under this Agreement with respect to such property and any related leasehold improvements, fixtures and equipment and inventory, and the Asset Price shall be reduced by the amount allocated to such Purchased Assets. 10.3 Notices. Any notice of any sort to be given hereunder by either ------- party to the other shall be in writing and delivered as follows: If to LSR, addressed to: Land Sales Resource 622 Executive Drive Willowbrook, IL 60521 Attention: Ms. Kitty Layne, President & CEO cc: Chris Manning, Esq. Burke, Warren and MacKay, P.C. 22 W. Washington, 24th floor Chicago, IL 60606 If to Layne, addressed to: Ms. Kitty Layne President & CEO Land Sales Resource 622 Executive Drive Willowbrook, IL 60521 If to COMPS, addressed to: COMPS InfoSystems, Inc. 9888 Carroll Center Road, Suite 100 San Diego, CA 92126 Attention: Mr. Chris Crane cc: Jerry W. Monroe, Esq. Monroe & Dostart 9191 Towne Centre Drive, Suite 270 San Diego, CA 92122 or to such other place and with such other copies as either party may designate as to itself by written notice to the other. 19 10.4 Choice of Law. This Agreement shall be construed, interpreted and ------------- the rights of the parties determined in accordance with the laws of the State of California, without reference to the choice of law provisions thereof. 10.5 Entire Agreement; Amendments and Waivers. This Agreement, together ---------------------------------------- with all exhibits and schedules hereto, constitutes the complete, final and exclusive statement of the terms of the agreement among the parties pertaining to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and discussions of the parties. No modification or rescission of this Agreement shall be binding unless executed in writing by the party to be bound thereby. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided. 10.6 Counterparts. This Agreement may be executed in one or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 10.7 Expenses. Except as expressly provided herein with respect to sales -------- taxes, each party hereto shall pay its own legal, accounting, out-of-pocket and other expenses incident to this Agreement and to any action taken by such party in preparation for carrying this Agreement into effect. 10.8 Invalidity. In the event that any one or more of the provisions ---------- contained in this Agreement or in any other instrument referred to herein, shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, then to the maximum extent permitted by law, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement or any other such instrument. 10.9 Arbitration and Venue. Any controversy or claim arising out of or --------------------- relating to this Agreement or the making, performance or interpretation thereof shall be submitted to arbitration in San Diego, California, pursuant to the rules and procedures of the American Arbitration Association before a panel of three arbitrators. The ruling of the arbitrator shall be final, and judgment thereon may be entered in any court having jurisdiction. If any question is submitted to a court of law for resolution, then the Superior Court of the County of San Diego, California, or the United States District Court having jurisdiction in the County of San Diego, shall be the exclusive court of competent jurisdiction for the resolution of such question. The costs of an arbitration or any litigation whether the same shall arise either in connection with or apart from the arbitration shall be borne by the party against whom he award is granted. Each party shall be entitled to pre-hearing discovery as provided in California Code of Civil Procedure Section 1283.05. 10.10 Public Announcements. Neither COMPS, LSR, Layne nor any of their -------------------- respective affiliates shall issue any press release or make any public statement regarding the transactions contemplated hereby, without the prior written approval of the other parties hereto. 20 10.11 Construction. No provision of this Agreement shall be construed in ------------ favor of or against any party on the ground that such party or its counsel drafted the provision. Any remedies provided for herein are not exclusive of any other lawful remedies which may be available to either party. This Agreement shall at all times be construed so as to carry out the purposes stated herein. 10.12 Section and Other Headings. The section and other headings -------------------------- contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement. 10.13 Schedules and Exhibits Not Attached. The Schedules and Exhibits ----------------------------------- hereto are sometimes referenced as being "attached" to his Agreement. In fact, such Exhibits are compiled separately in a document entitled " SCHEDULES AND EXHIBITS TO THE ASSET PURCHASE AGREEMENT BETWEEN COMPS INFOSYSTEMS, THE LAND SALES RESOURCE AND KITTY LAYNE." In some instances, because of the exigencies of time, Schedules or Exhibits may not have been provided at the time of execution of this Agreement. All Schedules and Exhibits will be provided to COMPS not later than the midpoint in the time between the execution of this Agreement and the Closing Date. At any time within 15 business days after any Schedule or Exhibit is provided to COMPS, COMPS may object to its form or content and shall have the right to terminate this Agreement without liability unless amended to its satisfaction within 5 business days from the time of such objection. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written. COMPS InfoSystems, Inc. Land Sales Resource By: /s/ CHRIS CRANE By: /s/ KITTY LAYNE ------------------------------ ---------------------------- Chris Crane Kitty Layne President President & CEO By: /s/ Kitty Layne ---------------------------- Kitty Layne 21 APPENDIX I Definitions ----------- As used herein, the terms below shall have the following meanings. Any of these terms, unless the context otherwise requires may be used in the singular or plural, depending upon the reference. "Balance Sheet" shall mean the audited balance sheets of LSR as of April ------------- 30, 1995 and May 31, 1995, together with the notes thereon and the related report of Roche, Scholz, Roche, Walsh, LTD, LSR's certified public accountants. "Balance Sheet Data" shall mean May 31, 1995. ------------------ "Benefit Arrangement" shall mean any employment, consulting, severance or ------------------- other similar contract, arrangement or policy and each plan, arrangement (written or oral), program, agreement, or commitment providing for insurance coverage (including any self-insured arrangements), workers" compensation, disability benefits, supplemental unemployment benefits, vacation benefits, retirement benefits, life, health, disability or accident benefits (including, without limitation, any "voluntary employees' beneficiary association" as defined in Section 501(c) (9) of the Code providing for the same or other benefits) or for deferred compensation, profit-sharing bonuses, stock options, stock appreciation rights, stock purchases or other forms of incentive compensation or post-retirement insurance, compensation or benefits which (A) is not a Welfare Plan, Pension Plan or Multi-employer Plan, (B) is entered into, maintained, contributed to or required to be contributed to, as the case may be, by the Company or an ERISA Affiliate or under which the Company or any ERISA Affiliate may incur any liability, and (C) covers any employee or former employee of the Company or any ERISA Affiliate (with respect to their relationship with such entities). "Books and Records" shall mean (i) all records and lists pertaining to the ----------------- Purchased Assets, (ii) all records and lists pertaining to the business, customers, suppliers or personnel of LSR, (iii) all product, business and marketing plans of LSR, and (iv) all books, ledgers, files, reports, plans, drawings and operating records of every kind maintained by LSR. "Code" shall mean the Internal Revenue Code of 1986, as amended. ---- "Disclosure Schedule" shall mean the disclosure schedule attached hereto. --------------------- "Employee Plans" shall mean all Benefit Arrangements, Multi-employer Plans, -------------- Pension Plans and Welfare Plans. "Encumbrances" shall mean any claim, lien, pledge, option, charge, ------------ easement, security interest, deed of trust, mortgage, right-of-way, encroachment, building or use restriction, conditional sales agreement, encumbrance or other right of a third party, whether voluntarily incurred or arising by operation of law, and includes, without limitation, any agreement to give any of the foregoing in the future, and any contingent sale or other title retention agreement or lease in the nature thereof. "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as ----- amended. "ERISA Affiliate" shall mean any entity which is (or at any relevant time --------------- was) a member of a "controlled group of corporations" with or under "common control" with the Company as defined in Section 414(b) or (c) of the Code. "Facilities" shall mean the Real Property and any facilities covered by any ---------- Real Property Lease. "Financial Statements" Unaudited financial statements at April 30, 1995 -------------------- and May 31, 1995. "Leased Property" shall mean all property leased pursuant to the Real --------------- Property Leases. "Multi-employer Plan" shall mean any "multi-employer plan, as defined in ------------------- Section 4001(a) (3) of ERISA, (A) which the Company or any ERISA Affiliate maintains, administers, contributes to or is required to contribute to, or, after September 25, 1980, maintained, administered, contributed to or was required to contribute to, or under which the Company or any ERISA Affiliate may incur any liability and (B) which covers any employee or former employee of the Company or any ERISA Affiliate (with respect to their relationship with such entities). "Pension Plan" shall mean any "employee pension benefit plan" as defined in ------------ section 3(2) of ERISA (other than a Multi-employer Plan) (A) which the Company or any ERISA Affiliate maintains, administers, contributes to or is required to contribute to, or, within the five years prior to the Closing Date, maintained, administered, contributed to or was required to contribute to, or under which the Company or any ERISA Affiliate may Incur any liability and (B) which covers any employee or former employee of the Company or any ERISA Affiliate (with respect to their relationship with such entities). "Representative" of a party shall mean any officer, director, principal, -------------- attorney, agent, employee or other representative of such party. "Settlement Time" shall mean 5:00 p.m. Pacific Daylight time on the Closing --------------- Date. "Welfare Plan" shall mean any "employee welfare benefit Plan" as defined in ------------ Section 3(1) of ERISA, (A) which the Company or any ERISA Affiliate maintains, administers, contributes to or is required to contribute to, or under which the Company or any ERISA Affiliate may incur any liability and (B) which covers any employee or former employee of the Company or any ERISA Affiliate (with respect to their relationship with such entities). SCHEDULES AND EXHIBITS TO THE ASSET PURCHASE AGREEMENT BETWEEN COMPS INFOSYSTEMS, INC., THE LAND SALES RESOURCE AND KITTY LAYNE Exhibits: 1.1.2 Real Property Leases 1.1.3 Equipment Leases 2.2.1 (1) Assignment and Assumption Agreement 2.2.1 (2) Assignment of Real Property Lease 2.2.1 (3) Assignment of Equipment Lease 8 Covenant Not To Compete Schedules: 1.1 Purchased Assets 1.1.1 Detail of Assets Described in Paragraph 1.1.1 1.1.6 Machinery, Equipment, Furniture, Fixtures, Vehicles, Office Equipment, Supplies, Tools, Inventory and Parts 1.2 Liabilities 1.4 Allocation of Asset Purchase Price Exhibit 1.1.2(1) LEASE THIS LEASE, made September 19, 1991 between Willowbrook Office an Illinois limited partnership, sole beneficiary of American National Bank and Trust Company of Chicago, as Trustee under Trust Agreement dated March 1, 1979 and known as Trust No. 46058 (herein called Lessor), and THE LAND SALES RESOURCE, INC. (herein called Lessee), whereby Lessee has leased from Lessor, and Lessor has demised to Lessee, certain premises containing approximately 1,352 square feet, and designated as Unit 9N (herein called Leased Premises), as outlined in red on the attached (Exhibit A) building floor plan, in the building (herein called Building) on Lot 1 in the Resubdivision of Lot 35 in Willowbrook Executive Plaza, Willowbrook, Illinois situated on a parcel of ground (herein called Site), the vacant portion of which is improved with parking areas, driveways and landscaping. The Lease term will be for a term of 5 years 6 months and will commence on November 1, 1991 and terminate April 30, 1997 (herein called Lease Term). The term rental will be $77,063.94 (herein called Term Rent) payable monthly in advance in installments of $___*____ each (herein called Monthly installments). "Lessee's Proportionate Share" as such term is hereinafter used shall be 2.67%. Lessee has deposited with Lessor's beneficiary the sum of $2,478.66 as Security Deposit. Leased Premises shall be used only for General Office - -------------------------------------------------------------------------------- (herein called the Specified Use). "Holdover Rental" as such term is hereinafter used, shall be the amount of the Monthly Installment for the last month of the Lease Term divided by fifteen. Until otherwise notified in writing by Lessor, the Term Rental, Monthly Installments and all other sums to be paid by Lessee to Lessor hereunder shall be made payable to the order of Wiskes/Abaris Willowbrook Office Partnership, 650 Executive Drive, Willowbrook, Illinois 60521. IN WITNESS WHEREOF, the parties have executed this Lease the day and year first above written, intending thereby to incorporate and include therein, all terms, conditions and provisions contained In Sections 1 through 27 attached hereto as though the said Sections had been hereinbefore fully set forth. LESSOR: LESSEE: Willowbrook Office Partnership THE LAND SALES RESOURCE, INC. 7701 S. Grant St. Burr Ridge, Ill. 60521 By: /s/ DON J. WISKES By: /s/ KITTY LAYNE, President ------------------------------ ------------------------------ General Partner (Title) 11-1-91--4-30-92... 0 ATTEST: 5-1-92---10-31-94..$1,239.33/mo. /s/ [ILLEGIBLE] MILLER 11-1-94--10-31-95.. 1,295.67/mo. --------------------------------- 11-1-95--4-30-97... 1,352.00/mo. (Title) ADDRESS OF LESSEE: 622 Executive Drive Willowbrook, Illinois 60521 9/19/91 #1 INITIAL - ---------- Landlord Tenant - ---------- IN CONSIDERATION WHEREOF, THE PARTIES HERETO COVENANT AND AGREE AS FOLLOWS: Section 1. RENTAL 1.1 Lessee agrees to pay the Term Rent to Lessor in Monthly Installments payable one each in advance on or before the first day of every calendar month of the Lease Term, in lawful money of the United States or by good check or draft (subject to collection) 1.2 Lessee shall pay to Lessor, as additional rental, (a) Lessee's Proportionate Share of the amount by which the general real estate taxes payable during each year of the Lease Term, on the Building and Site of which Leased Premises are a part exceed the amount of .80 cents per square foot of Building and (b) Lessee's Proportionate Share of installments of special assessments, if any, payable during each year of the Lease Term applicable to the Building and Site of which the Leased Premises are a part. Lessee shall not be liable for any special assessments for improvements completed prior to the commencement date of the Lease Term, nor for any income or other taxes, of the Lessor. 1.3 Lessee shall pay to Lessor as additional rental for each year of the Lease Term Lessee's Proportionate Share of the amount by which the cost of common area maintenance (as hereinafter defined) incurred by Landlord during such year exceeds .41 cents per square foot of Building. Common area maintenance includes the operation, repair and replacement of parking areas, driveways, sidewalks, landscaped areas, drainage facilities and exterior lighting on the Site, and, without limiting the generality of the foregoing, snow and ice removal from and sweeping of the parking areas, driveways and sidewalks. 1.3 A. Insurance. Lessee shall pay to Lessor as additional rental for each year of the lease term Lessee's proportionate share of the amount by which the premium cost of Lessor's extended coverage insurance, with all endorsements, on all public liability and property damage insurance exceeds $.0849 per square foot of building. 1.4 Lessor shall submit to Lessee annual statements showing the computations of the amount of Lessee's liability, if any, under Sections 1.2 and 1.3 which amount Lessee shall pay to Lessor on or before thirty (30) days immediately following delivery of such statement. Such amounts shall be prorated as of the commencement date for the first year of the Lease Term and as of the termination date for the last year of the lease Term. 1.5 The Term Rent and additional rental shall be paid by Lessee promptly when due, without any deduction or setoff whatsoever. Any such amount not paid when due shall bear interest at the rate of 18% per annum from the due date until paid. Section 2. SECURITY DEPOSIT 2.1 The Security Deposit may be applied by Lessor the purpose of curing any default or defaults of Lessee under this Lease. If said sum or any part thereof is used, applied or retained in curing any such default, Lessee shall, upon demand, immediately deposit with Lessor an amount in cash equal to the amount so used, applied or retained. Default by lessee in paying to Lessor any amount required to restore the Security Deposit after any application thereof, shall afford to Lessor the same remedies as in the default of the payment of the rent. If Lessee has not defaulted hereunder, or if Lessor has not applied said sum to said default, then the Security Deposit or any portion thereof not so applied by Lessor shall be paid to Lessee within thirty (30) days after the termination of this Lease, provided Lessee has surrendered possession of the Leased Premises in accordance with the provisions of this Lease. In the event of a bona-fide sale of the Site and the Building, Lessor shall have the -2- right to transfer the Security Deposit to the purchaser to be held, under the terms of this Lease and, in such event, Lessor shall be released from all liability for the return of such Security Deposit to Lessee. Section 3. UTILITY SERVICES 3.1 Lessee shall promptly pay for all public utilities rendered or furnished, and metered to the Leased Premises during the term of this Lease. Lessee shall not waste or permit the waste of water, or use the water for any purpose other than those stated. Lessor periodically will bill Lessee for Lessee's Proportionate share of all water bills received by Lessor for water metered to the Building and Lessee shall pay such amount not later than the date for the next Monthly Installment. Lessee may, at its own cost, install a submeter to meter water delivered to the Leased Premises and in such event Lessee shall be free of the restrictions regarding water usage and shall pay Lessor for water used according to meter readings (at the rate charged by the supplier of such water) in lieu of paying the aforesaid percentage of bills for all water metered to the Building. All leases heretofore or hereafter executed with respect to premises in the Building will contain identical restrictions with respect to the use, misuse or wasting of water, except where the Lessee installs a submeter at its cost (and such submetered water will be deducted prior to computing Lessee's obligation for such water bills). Lessor shall not be liable for damages, by abatement of rent or otherwise, for interruption of failure of or delay in, furnishing any service or utility, whether the responsibility of Lessor or of others, when the same is occasioned by causes beyond the reasonable control of Lessor, and no such interruption, failure or delay shall be deemed an eviction or disturbance of Lessee's use of the Leased Premises. Section 4. USE 4.1 Lessee may use the Leased Premises for the Specified Use. Lessee shall not injure, overload, deface or otherwise harm Site, Building or Leased Premises nor permit the same; nor commit any nuisance; nor permit the emitting of any objectionable noise or odor; nor burn any trash or refuse thereon or therein; nor manufacture, sell, display, distribute or give away any alcoholic liquors or beverages; nor make or permit any use of Leased Premises which is improper, offensive or contrary to any law or ordinance, or which will invalidate or increase the cost of any Lessor's insurance (including the keeping or storage of any article of dangerous, inflammable or explosive character) or which would increase the danger of fire in Leased Premises or in the Building; nor obstruct or permit the obstruction of driveways, walks, parking areas and other common areas of Site. 4.2 Lessee shall not exhibit, inscribe, paint or affix any sign, advertisement, notice or other lettering (hereinafter referred to as "signs") on any part of the Site, exterior of the Building, or in the windows, without the express prior written consent of Lessor, which consent will not be unreasonably withheld. Lessor shall have, at any time and from time to time, the right to establish rules and regulations setting forth uniform characteristics for all signs on the Building and Site, and Lessor's refusal to consent to any sign not meeting such characteristics shall not be deemed to be unreasonable. In the event of the violation of the foregoing, Lessor may remove same without any liability, and may charge the expense incurred by such removal to Lessee. Subject to applicable laws, ordinances and regulations, Lessee may, however, place a sign on the front door of Leased Premises which sign shall be installed by Lessor at the expense of Lessee, and shall be (i) for identification purposes only; (ii) uniform with all other such signs on Building; and (iii) of a size, color and style acceptable to Lessor. Section 5. CONDITION OF PREMISES 5.1 Lessee's taking possession of the Leased Premises shall be conclusive evidence that Leased Premises were in good order and satisfactory condition when Lessee took possession, with the exception of those items if any, detailed in a written list executed by Lessor and Lessee at or prior to acceptance of possession. No promise of Lessor to alter, remodel, complete or improve Leased Premises or Building or Site, and no representation concerning the condition of Leased Premises or Building or Site have been made by Lessor to -3- Lessee unless same is contained herein or is contained in agreed plans and specifications signed by both parties. At the termination of this Lease by lapse of time or otherwise, Lessee shall return Leased Premises in good order and condition, loss or damage by fire or other casualty, conditions which are the responsibility of Lessor to repair pursuant to the terms of Section 6.1 hereof, and ordinary wear and tear excepted. Section 6. MAINTENANCE AND ALTERATIONS 6.1 Maintenance. Lessor shall keep and maintain the roof and structural members of the Building of which the Leased Premises are a part, and the parking lot, sidewalks and landscaping on the Site in good order and repair, except for loss by fire or other casualty covered by Section 9 of this Lease, and shall remove snow accumulations from the parking lot and sidewalks. Lessee shall keep and maintain the balance of the exterior and the entire interior of the Leased Premises clean and sanitary and in good condition and repair including, without limitation, any necessary replacements (and further including, without limitation, necessary interior painting and window replacement). Lessee shall fully comply with all health and police regulations in force and shall conform with the rules and regulations of fire underwriters or their fire protection engineers. Lessor will obtain the qualified Contractor to inspect and maintain the HVAC equipment at Lessee's premises. Lessor will bill Lessee monthly commencing November 1, 1991. The cost will be $35.00 per month and will be billed and payable with your monthly rent. Lessee shall promptly remove any debris left in the parking area or other exterior areas of the Site by Lessee, its employees, agents or contractors. 6.2 Alterations. Lessee shall not create any openings in the roof or exterior wails, nor shall Lessee make any alterations or additions to the Leased Premises. Lessee shall make all additions, improvements, alterations and repairs on the Leased Premises and on and to the appurtenances and equipment thereof required by any governmental authority or which may be made necessary by the act or neglect of any person, firm or corporation (public or private). Upon completion of any work by or on behalf of Lessee, Lessee shall provide Lessor with such documents as Lessor may require (including, without limitation, sworn contractor's statements and supporting lien waivers) evidencing payment in full for such work. Section 7. INDEMNIFICATION AND RELEASE OF CLAIMS 7.1 Lessee will at all times hold Lessor, its beneficiaries and the management of the Building harmless and indemnified against any loss, damage, cost, expense or liability resulting to any person or property by reason of any use which may be made of the Leased Premises or any part thereof, or by reason of any act or thing done or omitted to be done in, upon or about Leased Premises or any part thereof, unless such loss, damage, cost, expense or liability shall be caused by the sole negligence of Lessor; and Lessee will hold Lessor and Site, Building and Leased Premises harmless, indemnified and free and clear of any and all claims, demands, penalties, liabilities, judgments, costs and expenses, including reasonable attorneys' fees, arising in connection with any use of Leased Premises by Lessee or its employees, agents or servants. 7.2 Only to the extent that such business interruption, loss or damage to property or injury to or death of persons is covered by insurance, neither Lessor nor Lessee shall be liable to the other for any business interruption or any loss or damage to property or injury to or death of persons occurring on Site, in Building or in Leased Premises or in any manner growing out of or connected with the Lessee's use and occupation of Leased Premises, Building and Site, or the condition thereof, whether or not caused by the negligence or other fault of Lessor or Lessee, or of their respective agents, employees, subtenants, licensees, or assignees. Nothing herein shall be construed to impose any other or greater liability upon either Lessor or Lessee than would have existed in the absence of this Section 7.2. This release shall be in effect only so long as the applicable insurance policies contain a clause to the effect that this release shall not affect the right of the insured to recover under such policies. Such clauses shall be obtained by the parties whenever possible. The release in favor of Lessor contained herein, is in -4- INITIAL - ---------- Landlord Tenant - ---------- addition to, and not in substitution for, or in diminution of the hold harmless and indemnification provisions of Section 7.1 hereof. Section 8. INSURANCE 8.1 At all times during the Lease Term Lessee shall, at its sole cost and expense, maintain: (a) Comprehensive General Public Liability Insurance against claims for personal injury, death or property damage occurring in connection with the use and occupancy of Leased Premises, naming Lessee and Lessor, Lessor's beneficiaries and the management of Building as the named insureds, such insurance to afford protection to the limit of not less than Five Hundred Thousand ($500,000.00) Dollars in respect to injury or death of a single person, and to the limit of not less than One Million ($1,000,000.00) Dollars in respect to any one accident, and to the limit of not less than One Hundred Thousand ($100,000.00) Dollars in respect to property damage. (b) Steam Boiler Insurance an all steam boilers, pressure tanks and other such apparatus, if any shall, from time to time, be installed on Leased Premises, in such amount as Lessor may from time to time reasonably require. (c) At all times when any work is in process in connection with any change or alteration being made by Lessee, Lessee shall maintain Workmen's Compensation insurance covering all persons employed in connection with the work and with respect to whom death or bodily injury claims could be asserted against Lessor or its beneficiaries, as well as Lessee or Leased Premises. 8.2 Lessee shall furnish Lessor with a duplicate certificate or certificates of such insurance and not less than ten (10) days prior to the expiration date of any policy, will furnish Lessor with a new policy or certificate therefor or a renewal thereof, in substitution of the expiring policy. Each such policy which Lessee is required to procure and maintain hereunder shall be issued by insurers of recognized responsibility licensed to do business in Illinois, and shall contain an agreement or endorsement that it will not be cancelled by the insurer without at least ten (10) days' prior written notice to Lessor. 8.3 Lessee will not do, suffer or permit any act or omission, whether upon Leased Premises or otherwise, which might or would result in voiding or impairing the obligation of any such policy of insurance. Section 9. FIRE AND CASUALTY. 9.1 If Leased Premises or Building are substantially destroyed or rendered untenantable by fire or other casualty, Lessor shall have the right to terminate this Lease by notice in writing to Lessee mailed within thirty (30) days of the fire or other casualty. In any case of fire or other casualty damage to Leased Premises (except where this Lease is terminated by Lessor as hereinbefore provided), Lessor shall repair and rebuild Leased Premises within one hundred and fifty (150) days of the fire or other casualty, and, upon failing to do so, Lessee shall have the right to terminate this Lease by notice in writing to Lessor mailed within twenty (20) days thereafter. If any such fire or other casualty renders Leased premises or any portion thereof untenantable, the rent to be paid by Lessee hereunder shall abate by an amount bearing the same ratio of the total amount of rent for the period of untenantability as the untenantable portion of Leased Premises bears to the entire Leased Premises during the period beginning with the date of such fire or other casualty and ending with the date when Leased Premises are again rendered tenantable. Section 10. CONDEMNATION 10.1 If the whole of Leased premises shall be taken for any public or quasi-public use under statute or by right of eminent domain by private purchase in lieu thereof, then this Lease shall automatically terminate as of the date that title shall be taken. If any portion of Leased premises shall be so taken as to render the remainder thereof unusable for the purpose for which Leased Premises were leased, then Lessor and Lessee shall each have -5- the right to terminate this Lease on thirty (30) days' notice to the other given within sixty (60) days after the date of such taking. In the event neither party shall exercise the aforesaid right to terminate, the rent payable under this Lease shall be equitably apportioned according to the space so taken, and Lessor shall, at its own cost and expense, restore the remaining portion of Leased Premises to the extent necessary to render it reasonably suitable for the purposes for which it was leased and shall make all repairs to Building to the extent necessary to constitute Building a complete architectural unit, provided the cost thereof shall not exceed the proceeds of Lessor's condemnation award. Lessee shall not be entitled to receive any part of any award or awards based upon taking of the fee or lease hold interest, which shall be the property of Lessor, and Lessee hereby assigns to Lessor any of Lessee's rights, title or interest therein, but Lessee may prosecute any claim against the condemning authority in such condemnation proceedings for damages which it may have sustained; provided, however, that no such claim shall diminish or otherwise adversely affect Lessor's award or the award of any fee mortgagee. Section 11. ASSIGNMENT AND SUBLETTING 11.1 Lessee shall not sublet any part of Leased Premises nor assign this Lease, without in each and every case Lessor's prior written consent thereto first had, which consent shall not be unreasonably withheld, provided, however, that Lessee shall remain liable hereunder; nor will Lessee make or permit any transfer of this Lease or any interest hereunder by operation of law. Section 12. LESSOR'S PERFORMANCE OF LESSEE'S COVENANTS 12.1 Should Lessee at any time fail or omit to do any act or thing provided under this Lease to be done by Lessee, Lessor may in its sole discretion after ten (10) days' written notice to Lessee, itself do or cause to be done such act or thing (including the payment of any claim or lien upon Leased Premises made or filed by any laborer, supplier, materialman, principal contractor, subcontractor, or other person, whether for work, labor or services performed upon, or materials supplied to Leased Premises). All monies paid by Lessor shall be and constitute so much additional rental due hereunder from Lessee to Lessor to be due and payable upon notice given by Lessor of the nature and amount thereof, on the first day of the calendar month next succeeding the month during which Lessor shall have given notice, with interest upon any such amount at the rate of ten percent (10%) per annum from the date of payment by Lessor until repayment to Lessor by Lessee. Section 13. RIGHTS RESERVED TO LESSOR 13.1 Lessor reserves the following rights: (a) To have pass keys to Leased Premises and no locks shall be changed without the prior written consent of Lessor; (b) To enter the Leased premises for the purpose of making inspections or repairs, alterations or improvements connected with any portion of Leased premises during reasonable hours, and at any time in the event of an emergency; (c) To show Leased premises to prospective lessees or brokers during the last six months of the Term of this Lease (and if vacated during such period, to prepare Leased Premises for reoccupancy) and to prospective purchasers at all reasonable times, provided prior notice is given to Lessee in each case; (d) To designate and/or approve, prior to installation, all types of window shades, blinds, drapes, awnings, window ventilators, and other similar equipment, and to control all internal lighting that may be visable from the exterior of Building. -6- Section 14. SUBORDINATION TO EXISTING AND FUTURE MORTGAGES 14.1 At the option of Lessor's mortgagee, this Lease shall be subject and subordinate at all times to the lien of any existing mortgage or mortgages and of mortgages which hereafter may be made a lien on Site and/or Building; provided that so long as Lessee is not in default under this Lease, its possession of Leased premises and its rights and privileges hereunder shall not be interfered with by the mortgagee or any purchaser upon a foreclosure of such mortgage. Although no instrument or act on the part of the Lessee shall be necessary to effectuate such subordination, the Lessee shall nevertheless execute and deliver such further instruments subordinating this Lease to the lien of any such mortgages as may be desired by the mortgagee, provided the same acknowledges Lessee's rights as hereinbefore specified. The Lessee hereby appoints the Lessor its attorney-in-fact irrevocably to execute and deliver any such instrument for the Lessee. Section 15. RIGHTS AND REMEDIES OF LESSOR 15.1 If default shall be made in the payment of any sum required to be paid by Lessee under this Lease, and default shall continue for five (5) days after written notice to Lessee, or default shall be made in the performance of any of the other covenants or conditions which Lessee is required to observe and perform, and such default shall continue for fifteen (15) days after written notice to Lessee, or if the interest of Lessee under this Lease shall be levied on under execution or other legal process, or if any petition shall be filed by or against Lessee to declare Lessee a bankrupt or to delay, reduce or modify Lessee's debts or obligations, or if any petition shall be filed or other action taken to reorganize or modify Lessee's capital structure if Lessee be a corporation or other entity, or if Lessee be declared insolvent according to law, or if any assignment of Lessee's property shall be made for the benefit of creditors, or if a receiver or trustee is appointed for Lessee or its property, or if Lessee shall abandon Leased premises during the term of this Lease, then Lessor may treat the occurrence of any one or more of the foregoing events as a breach of this Lease (provided that no such levy, execution, legal process or petition filed against Lessee shall constitute a breach of this Lease if Lessee shall vigorously contest the same by appropriate proceedings and shall remove or vacate the same within thirty (30) days from the date of its creation, service or filing) and thereupon, at its option, may without notice or demand of any kind to Lessee or any other person, have any one or more of the following described remedies in addition to all other rights and remedies provided at law or in equity: (a) Lessor may terminate this Lease and forthwith repossess Leased Premises and be entitled to recover forthwith as damages a sum of money equal to the balance of the Term Rent then remaining unpaid hereunder (without commutation, in consideration of disregarding any rent adjustments pursuant to Section 1.2 hereof) less the fair rental value of Leased premises for said period, and any other sum of money and damages owed by Lessee to Lessor; (b) Lessor may terminate Lessee's right of possession and may repossess Leased Premises by forcible entry or detainer suit or otherwise, without demand or notice of any kind to Lessee and without terminating this Lease, in which event Lessor may, but shall be under no obligation so to do, relet the same for the account of Lessee for such rent and upon such terms as shall be satisfactory to Lessor. For the purpose of such reletting Lessor is authorized to decorate or to make any repairs, changes, alterations or additions in or to Leased Premises that may be necessary or convenient, and if Lessor shall fail or refuse to relet Leased Premises, or if the same are relet and a sufficient sum shall not be realized from such reletting after paying all of the costs and expenses of such decorations, repairs, changes, alterations and additions and the expense of such releting and of the collection of the rent accruing therefrom to satisfy the rent provided for in this Lease to be paid, then Lessee shall pay to Lessor as damages a sum equal to the amount of the rental reserved in this Lease for such period or periods, or if the Leased premises have been relet the Lessee shall satisfy and pay any such deficiency upon demand therefor from time to time and Lessee agrees that Lessor may file suit to recover any sums falling due under the terms of this Section 15.1(b) from time to time , and that no delivery or recovery of any portion due Lessor hereunder shall be any defense to any subsequent action brought for any amount not theretofore reduced to judgment in favor of Lessor. -7- 15.2 Upon the termination of this Lease or upon the termination of Lessee's right of possession, Lessee shall at once surrender possession of Leased Premises to Lessor and remove all effects therefrom, and if such possession is not immediately surrendered Lessor may forthwith re-enter Leased Premises and repossess itself as of its former estate and remove all persons and effects therefrom, using such force as may be necessary without being guilty of any manner of trespass or forcible entry or detainer. Without limiting the generality of the foregoing, Lessee agrees to remove, at the termination of this Lease or upon the termination of Lessee's right of possession, Lessee's movable furniture, signs, trade fixtures, machinery, equipment and other personal property and such alterations, improvements and additions made by Lessee as may be requested by Lessor. If Lessee shall fail or refuse to remove all such property from Leased Premises, Lessee shall be conclusively presumed to have abandoned the same and title thereto shall thereupon pass to Lessor without any cost, either by setoff, credit, allowance or otherwise, and Lessor may, at its option, accept the title to such property or at Lessee's expense may remove the same, or any part thereof, in any manner that Lessor shall choose, and store the same without incurring liability to Lessee or any other person. 15.3 Lessee shall pay, upon demand, all of Lessor's costs, charges, and expenses, including the fees of counsel, agents and other retained by Lessor, at any time incurred in enforcing Lessee's obligations hereunder (whether incurred in litigation or otherwise) or incurred by Lessor in any litigation, negotiation or transaction in which Lessee causes Lessor, without Lessor's fault, to become involved or concerned. Section 16. HOLDING OVER 16.1 Lessee shall pay to Lessor Holdover Rental for each day Lessee shall retain possession of Leased Premises, or any part thereof, after the termination of this Lease, whether by lapse of time or otherwise and shall also pay all damages sustained by Lessor on account thereof; but the provisions of this article shall not operate as a waiver by Lessor of any right of re-entry hereinbefore provided; nor shall the receipt of said rent or any part thereof, or any other act in apparent affirmance of tenancy, operate as a waiver of the right to forfeit this Lease and the Lease Term hereby granted for the period still unexpired, for a breach of any of the covenants herein. Section 17. NOTICES 17.1 All notices to be given by one party to the other under this Lease shall be in writing, mailed or delivered as follows: if to Lessor, at the place where rent is payable; if to Lessee, at the address of Lessee set forth on the first page hereof until Lessee takes possession of the Leased Premises and thereafter at Leased Premises, provided that either party may, by notice to the other, from time to time designate another address to which notices shall thereafter be addressed. Mailed notices shall be sent by United States Certified or Registered Mail, postage prepaid. Such notices shall have been deemed to have been given by posting in the United States Mails. Section 18. ESTOPPEL CERTIFICATE 18.1 Lessee shall at any time and from time to time within ten (10) days after written request from Lessor execute, acknowledge and deliver to Lessor, in form reasonably satisfactory to Lessor and/or Lessor's mortgagee, a written statement certifying (if true) that Lessor has accepted the Leased Premises, that this Lease is unmodified and in full force and effect (or if there have been modifications, that the same is in full force and effect as modified and stating the modifications), that the Lessor is not in default hereunder, the date to which the rental and other charges have been paid in advance, if any, and such other accurate certifications as may reasonably be required by Lessor or Lessor's mortgagee, and agreeing to give copies to any mortgagee of Lessor of all notices by Lessee to Lessor. It is intended that any such statement delivered pursuant to this subsection may be relied upon by any prospective purchaser or mortgagee of the Leased Premises and their respective successors and assigns. -8- Section 19. COVENANT OF QUIET ENJOYMENT 19.1 Lessor further agrees that at all times when Lessee is not in default under the terms of and during the term of this Lease, Lessee's quiet and peaceable enjoyment of the Leased Premises shall not be disturbed or interfered with by Lessor or by any person claiming by, through or under Lessor. Section 20. POSSESSION 20.1 Lessor shall construct, or cause to be constructed, the Leased Premises in accordance with the provisions of Exhibit B attached hereto, including building standard work therein described. 20.2 Construction shall be commenced and diligently pursued in order to have the Leased Premises substantially completed on or before the date specified for commencement of the Lease Term, provided that if construction is delayed because of changes, deletions or addition in construction requested by Lessee, strikes, lockouts, casualties, acts of God, war, material or labor shortages, governmental regulation or control or other causes beyond the control of Lessor, the construction time period shall be extended for the amount of time Lessor is so delayed, and Monthly Installments of rental shall abate pro rata until substantial completion and delivery of possession. 20.3 Lessor shall notify Lessee as soon as the Leased Premises are substantially completed. In the event that there is a dispute as to whether or not the Leased Premises are substantially completed, the dispute shall be resolved by the architect for the Building. Taking of possession by Lessee shall be deemed conclusively to establish that the Leased Premises have been completed in accordance with the said Exhibit B. If Lessor gives possession prior to the commencement date to enable Lessee to fit the Leased Premises to its use, such occupancy shall be subject to all the terms and conditions of this Lease (except that Lessee shall not be required to pay rent or taxes during such occupancy). Section 21. ACTS SUBSEQUENT TO TERMINATION 21.1 No receipt of money by Lessor from Lessee after the termination of this Lease, the service of any notice, the commencement of any suit or final judgment for possession shall reinstate, continue to extend the term of this Lease or affect any such notice, demand, suit or judgment. Section 22. WAIVER OF DEFAULT 22.1 No waiver of default of Lessee shall be implied, and no express waiver shall affect any default other than the default specified in such waiver and that only for the time and to the extent therein stated. The invalidity or unenforceability of any provision of this Lease shall not affect or impair any other provision. Section 23. EXAMINATION OF LEASE 23.1 Submission of this installment for examination or signature by Lessee does not constitute a reservation of or option for lease, and it is not effective as a lease or otherwise until execution and delivery by both Lessor and Lessee. Section 24. DEFAULT UNDER OTHER LEASE 24.1 If the term of any lease, other than this Lease, made by Lessee, for the Leased Premises or any part thereof, or for any other space in the Building shall be terminated or terminable after the making of this Lease, because of any default by Lessee under such other lease, such fact shall empower Lessor, at Lessor's sole option, to terminate this Lease by notice to Lessee and/or to exercise any of the remedies set forth in Section 15. -9- Section 25. REPRESENTATIVE CAPACITY 25.1 No person, partnership, corporation or other organization executing this Lease in a representative capacity for Lessor or Lessee shall be held individually liable hereunder in the absence of fraud provided such person, partnership, corporation or other organization acted with due authority and the intended principals are bound. Section 26. MISCELLANEOUS 26.1 All rights and remedies of Lessor and Lessee under this Lease shall be cumulative and none shall exclude any other rights and remedies allowed by law or statute. 26.2 Each of the provisions of this Lease shall extend to and shall, as the case may require, bind or inure to the benefit, not only of Lessor and of Lessee, but also of their respective heirs, legal representatives, successors and permitted assigns, provided this clause shall not permit any assignment contrary to the provisions of Section 11 hereof. 26.3 All of the representations and obligations of Lessor and Lessee are contained herein and no modification, waiver or amendment of this Lease, or any of its conditions or provisions, shall be binding upon the Lessor and Lessee unless in writing, signed by Lessor and Lessee. 26.4 The receipt by Lessor of any installment of the regular stipulated rent hereunder or any of said additional rent, shall not be a waiver of any other additional rent then due or of any default of Lessee hereunder. 26.5 This Lease way be executed in any number of counterparts. Each such executed counterpart shall be deemed an original hereof and all such executed counterparts shall together constitute but one and the same installment, which instrument shall for all purposes be sufficiently evidenced by such executed counterpart. 26.6 The section and paragraph headings of this Lease are for convenience only and in no way limit or enlarge the scope or meaning of the language contained in the body of this Lease. 27.0 Build as per plan. Paint entire premises. Carpet entire premises. -10- INITIAL - ---------- Landlord Tenant - ---------- WILLOW LAKES OFFICE CENTER -------------------------- FLOOR PLAN INITIAL - ---------- Landlord Tenant - ---------- WILLOW LAKES OFFICE CENTER -------------------------- SITE PLAN INITIAL - ---------- Landlord Tenant - ---------- "EXHIBIT A" Exhibit 1.1.2(2) LEASE THIS LEASE, made July 20, 1993 between Willowbrook Office an Illinois limited partnership, sole beneficiary of American National Bank and Trust Company of Chicago, as Trustee under Trust Agreement dated March 1, 1979 and known as Trust No. 46058 (herein called Lessor), and THE LAND SALES RESOURCE, INC. (herein called Lessee), whereby Lessee has leased from Lessor, and Lessor has demised to Lessee, certain premises containing approximately 364 square feet, and designated as Unit 8NE (herein called Leased Premises), as outlined in red on the attached (Exhibit A) building floor plan, in the building (herein called Building) on Lot 1 in the Resubdivision of Lot 35 in Willowbrook Executive Plaza, Willowbrook, Illinois situated on a parcel of ground (herein called Site), the vacant portion of which is improved with parking areas, driveways and landscaping. The Lease term will be for a term of 3 years 9 months and will commence on August 1, 1993 and terminate April 30, 1997 (herein called Lease Term). The term rental will be $17,166.00 (herein called Term Rent) payable monthly in advance in installments of $___*___ each (herein called Monthly Installments). "Lessee's Proportionate Share" as such term is hereinafter used shall be .0072%. Lessee has deposited with Lessor's beneficiary the sum of ___$0___ as Security Deposit. Leased Premises shall be used only for General Office - -------------------------------------------------------------------------------- (herein called the Specified Use). "Holdover Rental" as such term is hereinafter used, shall be the amount of the Monthly Installment for the last month of the Lease Term divided by fifteen. Until otherwise notified in writing by Lessor, the Term Rental, Monthly Installments and all other sums to be paid by Lessee to Lessor hereunder shall be made payable to the order of Willowbrook Office Partnership, 650 Executive Drive, Willowbrook, Illinois 60521. IN WITNESS WHEREOF, the parties have executed this Lease the day and year first above written, intending thereby to incorporate and include therein, all terms, conditions and provisions contained In Sections 1 through 27 attached hereto as though the said Sections had been hereinbefore fully set forth. LESSOR: LESSEE: Willowbrook Office Partnership THE LAND SALES RESOURCE, INC. 622 Executive Drive Willowbrook, Ill. 60521 By: /s/ DON J. WISKES By: /s/ KITTY LAYNE President ----------------------------- ----------------------------- General Partner (Title) ATTEST: *Aug.1, `93--Oct. 31, `94..$ 364.00/mo. Nov. 1, `94--Oct. 31, `95.. 380.00/mo. /s/ CHERYL BENTLEY Nov. 1, `95--Apr. 30, `97.. 397.00/mo. -------------------------------- (Title) ADDRESS OF LESSEE: 622 Executive Drive Willowbrook, Illinois 60521 7/20/93 #2 INITIAL - ---------- Landlord Tenant - ---------- IN CONSIDERATION WHEREOF, THE PARTIES HERETO COVENANT AND AGREE AS FOLLOWS: Section 1. RENTAL 1.1 Lessee agrees to pay the Term Rent to Lessor in Monthly Installments payable one each in advance on or before the first day of every calendar month of the Lease Term, in lawful money of the United States or by good check or draft (subject to collection). 1.2 Lessee shall pay to Lessor, as additional rental, (a) Lessee's Proportionate Share of the amount by which the general real estate taxes payable during each year of the Lease Term on the Building and Site of which Leased Premises are a part exceed the amount of .80 cents per square foot of Building and (b) Lessee's Proportionate Share of installments of special assessments, if any, payable during each year of the Lease Term applicable to the Building and Site of which the Leased Premises are a part. Lessee shall not be liable for any special assessments for improvements completed prior to the commencement date of the Lease Term, nor for any income or other taxes, of the Lessor. 1.3 Lessee shall pay to Lessor as additional rental for each year of the Lease Term Lessee's Proportionate Share of the amount by which the cost of common area maintenance (as hereinafter defined) incurred by Landlord during such year exceeds .41 cents per square foot of Building. Common area maintenance includes the operation, repair and replacement of parking areas, driveways, sidewalks, landscaped areas, drainage facilities and exterior lighting on the Site, and, without limiting the generality of the foregoing, snow and ice removal from and sweeping of the parking areas, driveways and sidewalks. 1.3 A. Insurance. Lessee shall pay to Lessor as additional rental for each year of the lease term Lessee's proportionate share of the amount by which the premium cost of Lessor's extended coverage insurance, with all endorsements, on all public liability and property damage insurance exceeds .0849 per square foot of building. 1.4 Lessor shall submit to Lessee annual statements showing the computations of the amount of Lessee's liability, if any, under sections 1.2 and 1.3, which amount Lessee shall pay to Lessor on or before thirty (30) days immediately following delivery of such statement. Such amounts shall be prorated as of the commencement date for the first year of the Lease Term and as of the termination date for the last year of the Lease Term. 1.5 The Term Rent and additional rental shall be paid by Lessee promptly when due, without any deduction or setoff whatsoever. Any such amount not paid when due shall bear interest at the rate of 18% per annum from the due date until paid. Section 2. SECURITY DEPOSIT 2.1 The Security Deposit may be applied by Lessor the purpose of curing any default or defaults of Lessee under this Lease. If said sun or any part thereof is used, applied or retained in curing any such default, Lessee shall, upon demand, immediately deposit with Lessor an amount in cash equal to the amount so used, applied or retained. Default by Lessee in paying to Lessor any amount required to restore the Security Deposit after any application thereof, shall afford to Lessor the same remedies as in the default of the payment of the rent. If Lessee has not defaulted hereunder, or if Lessor has not applied said sum to said default, then the Security Deposit or any portion thereof not so applied by Lessor shall be paid to Lessee within thirty (30) days after the termination of this Lease, provided Lessee has surrendered possession of the Leased Premises in accordance with the provisions of this Lease. In the event of a bona-fide sale of the Site and the Building, Lessor shall have the right to transfer the Security Deposit to the purchaser to be held under the terms of this Lease and, in such event, Lessor shall be released from all liability for the return of such Security Deposit to Lessee. -2- Section 3. UTILITY SERVICES 3.1 Lessee shall promptly pay for all public utilities rendered or furnished, and metered to the Leased Premises during the term of this Lease. Lessee shall not waste or permit the waste of water, or use the water for any purpose other than those stated. Lessor periodically will bill Lessee for Lessee's Proportionate Share of all water bills received by Lessor for water metered to the Building and Lessee shall pay such amount not later than the date for the next Monthly Installment. Lessee may, at its own cost, install a submeter to meter water delivered to the Leased Premises and in such event Lessee shall be free of the restrictions regarding water usage and shall pay Lessor for water used according to meter readings (at the rate charged by the supplier of such water) in lieu of paying the aforesaid percentage of bills for all water metered to the Building. All leases heretofore or hereafter executed with respect to premises in the Building will contain identical restrictions with respect to the use, misuse or wasting of water, except where the Lessee installs a submeter at its cost (and such submerged water will be deducted prior to computing Lessee's obligation for such water bills). Lessor shall not be liable for damages, by abatement of rent or otherwise, for interruption or failure of, or delay in, furnishing any service or utility, whether the responsibility of Lessor or of others, when the same is occasioned by causes beyond the reasonable control of Lessor, and no such interruption, failure or delay shall be deemed an eviction or disturbance of Lessee's use of the Leased Premises. Section 4. USE 4.1 Lessee may use the Leased Premises for the Specified Use. Lessee shall not injure, overload, deface or otherwise harm Site, Building or Leased Premises nor permit the same; nor commit any nuisance; nor permit the emitting of any objectionable noise or odor; nor burn any trash or refuse thereon or therein; nor manufacture, sell, display, distribute or give away any alcoholic liquors or beverages; nor make or permit any use of Leased Premises which is improper, offensive or contrary to any law or ordinance, or which will invalidate or increase the cost of any Lessor's insurance (including the keeping or storage of any article of dangerous, inflammable or explosive character) or which would increase the danger of fire in Leased Premises or in the Building; nor obstruct or permit the obstruction of driveways, walks, parking areas and other common areas of Site. 4.2 Lessee shall not exhibit, inscribe, paint or affix any sign, advertisement, notice or other lettering (hereinafter referred to as "signs") on any part of the Site, exterior of the Building, or in the windows, without the express prior written consent of Lessor, which consent will not be unreasonably withheld. Lessor shall have, at any time and from time to time, the right to establish rules and regulations setting forth uniform characteristics for all signs on the Building and Site, and Lessor's refusal to consent to any sign not meeting such characteristics shall not be deemed to be unreasonable. In the event of the violation of the foregoing, Lessor may remove same without any liability, and may charge the expense incurred by such removal to Lessee. Subject to applicable laws, ordinances and regulations, Lessee may, however, place a sign on the front door of Leased Premises which sign shall be installed by Lessor at the expense of Lessee, and shall be (i) for identification purposes only; (ii) uniform with all other such signs on Building; and (iii) of a size, color and style acceptable to Lessor. Section 5. CONDITION OF PREMISES 5.1 Lessee's taking possession of the Leased Premises shall be conclusive evidence that Leased Premises were in good order and satisfactory condition when Lessee took possession, with the exception of those items if any, detailed in a written list executed by Lessor and Lessee at or prior to acceptance of possession. No promise of Lessor to alter, remodel, complete or improve Leased Premises or Building or Site, and no representation concerning the condition of Leased Premises or Building or Site have been made by Lessor to Lessee unless same is contained herein or is contained in agreed plans and specifications signed by both parties. At the termination of this Lease by lapse of time or otherwise, Lessee shall return Leased Premises in good order and condition, loss or damage by fire or other casualty, conditions which are the responsibility of Lessor to repair pursuant to the terms of Section 6.1 hereof, and ordinary wear and tear excepted. -3- Section 6. MAINTENANCE AND ALTERATIONS 6.1 Maintenance. Lessor shall keep and maintain the roof and structural members of this Building of which the Leased Premises are a part, and the parking lot, sidewalks and landscaping on the Site in good order and repair, except for loss by fire or other casualty covered by Section 9 of this Lease, and shall remove snow accumulations from the parking lot and sidewalks. Lessee shall keep and maintain the balance of the exterior and the entire interior of the Leased Premises clean and sanitary and in good condition and repair including, without limitation, any necessary replacements (and further including, without limitation, necessary interior painting and window replacement). Lessee shall fully comply with all health and police regulations in force and shall conform with the rules and regulations of fire underwriters or their fire protection engineers. Lessor will obtain the qualified Contractor to inspect and maintain the HVAC equipment at Lessee's premises. Lessor will bill Lessee monthly commencing Aug. 1, 1993. The cost will be $35.00 per month and will be billed and payable with your monthly rent. Lessee shall promptly remove any debris left in the parking area or other exterior areas of the Site by Lessee, its employees, agents or contractors. 6.2 Alterations. Lessee shall not create any openings in the roof or exterior walls, nor shall Lessee make any alterations or additions to the Leased Premises. Lessee shall make all additions, improvements, alterations and repairs on the Leased Premises and on and to the appurtenances and equipment thereof required by any governmental authority or which may be made necessary by the act or neglect of any person, firm or corporation (public or private). Upon completion of any work by or on behalf of Lessee, Lessee shall provide Lessor with such documents as Lessor may require (including, without limitation, sworn contractor's statements and supporting lien waivers).evidencing payment in full for such work. Section 7. INDEMNIFICATION AND RELEASE OF CLAIMS 7.1 Lessee will at all times hold Lessor, its beneficiaries and the management of the Building harmless and indemnified against any loss, damage, cost, expense or liability resulting to any person or property by reason of any use which may be made of the Leased Premises or any part thereof , or by reason of any act or thing done or omitted to be done in, upon or about Leased Premises or any part thereof, unless such loss, damage, cost, expense or liability shall be caused by the sole negligence of Lessor; and Lessee will hold Lessor and Site, Building and Leased Premises harmless, indemnified and free and clear of any and all claims, demands, penalties, liabilities, judgments, costs and expenses, including reasonable attorneys' fees, arising in connection with any use of Leased Premises by Lessee or its employees, agents or servants. 7.2 Only to the extent that such business interruption, loss or damage to property or injury to or death of persons is covered by insurance, neither Lessor nor Lessee shall be liable to the other for any business interruption or any loss or damage to property or injury to or death of persons occurring on Site, in Building or in Leased Premises or in any manner growing out of or connected with the Lessee's use and occupation of Leased Premises, Building and Site, or the condition thereof, whether or not caused by the negligence or other fault of Lessor or Lessee, or of their respective agents, employees, subtenants, licensees, or assignees. Nothing herein shall be construed to impose any other or greater liability upon either Lessor or Lessee than would have existed in the absence of this Section 7.2. This release shall be in effect only so long as the applicable insurance policies contain a clause to the effect that this release shall not affect the right of the insured to recover under such policies. Such clauses shall be obtained by the parties whenever possible. The release in favor of Lessor contained herein, is in addition to, and not in substitution for, or in diminution of the hold harmless and indemnification provisions of Section 7.1 hereof. -4- INITIAL - ---------- Landlord Tenant - ---------- Section 8. INSURANCE 8.1 At all times during the Lease Term Lessee shall, at its sole cost and expense, maintain: (a) Comprehensive General Public Liability Insurance against claims for personal injury, death or property damage occurring in connection with the use and occupancy of Leased Premises, naming Lessee and Lessor, Lessor's beneficiaries and the management of Building as the named insureds, such insurance to afford protection to the limit of not less than Five Hundred Thousand ($500,000.00) Dollars in respect to injury or death of a single person, and to the limit of not less than One Million ($1,000,000.00) Dollars in respect to any one accident, and to the limit of not less than One Hundred Thousand ($100,000.00) Dollars in respect to property damage. (b) Steam Boiler Insurance on all steam boilers, pressure tanks and other such apparatus, if any shall, from time to time, be installed an Leased Premises, in such amount as Lessor may from time to time reasonably require. (c) At all times when any work is in process in connection with any change or alteration being made by Lessee, Lessee shall maintain Workmen's Compensation insurance covering all persons employed in connection with the work and with respect to whom death or bodily injury claims could be asserted against Lessor or its beneficiaries, as well as Lessee or Leased Premises. 8.2 Lessee shall furnish Lessor with a duplicate certificate or certificates of such insurance and not less than ten (10) days prior to the expiration date of any policy, will furnish Lessor with a new policy or certificate therefor or a renewal thereof, in substitution of the expiring policy. Each such policy which Lessee is required to procure and maintain hereunder shall be issued by insurers of recognized responsibility licensed to do business in Illinois, and shall contain an agreement or endorsement that it will not be cancelled by the insurer without at least ten (10) days' prior written notice to Lessor. 8.3 Lessee will not do, suffer or permit any act or omission, whether upon Leased Premises or otherwise, which might or would result in voiding or impairing the obligation of any such policy of insurance. Section 9. FIRE AND CASUALTY. 9.1 If Leased Premises or Building are substantially destroyed or rendered untenantable by fire or other casualty, Lessor shall have the right to terminate this Lease by notice in writing to Lessee mailed within thirty (30) days of the fire or other casualty. In any case of fire or other casualty damage to Leased Premises (except where this Lease is terminated by Lessor as hereinbefore provided) , Lessor shall repair and rebuild Leased Premises within one hundred and fifty (150) days of the fire or other casualty, and, upon failing to do so, Lessee shall have the right to terminate this Lease by notice in writing to Lessor mailed within twenty (20) days thereafter. If any such fire or other casualty renders Leased premises or any portion thereof untenantable, the rent to be paid by Lessee hereunder shall abate by an amount bearing the same ratio of the total amount of rent for the period of untenantability as the untenantable portion of Leased Premises bears to the entire Leased Premises during the period beginning with the date of such fire or other casualty and ending with the date when Leased Premises are again rendered tenantable. Section 10. CONDEMNATION 10.1 If the whole of Leased premises shall be taken for any public or quasi-public use under statute or by right of eminent domain or by private purchase in lieu thereof, then this Lease shall automatically terminate as of the date that title shall be taken. If any portion of Leased premises shall be so taken as to render the remainder thereof unusable for the purpose for which Leased Premises were leased, then Lessor and Lessee shall each have the right to terminate this Lease on thirty (30) days' notice to the other given within sixty (60) days after the date of such taking. In the event neither party shall exercise the aforesaid right to terminate, the rent payable under this -5- Lease shall be equitably apportioned according to the space so taken, and Lessor shall, at its own cost and expense, restore the remaining portion of Leased Premises to the extent necessary to render it reasonably suitable for the purposes for which it was leased and shall make all repairs to Building to the extent necessary to constitute Building a complete architectural unit, provided the cost thereof shall not exceed the proceeds of Lessor's condemnation award. Lessee shall not be entitled to receive any part of any award or awards based upon taking of the fee or lease hold interest, which shall be the property of Lessor, and Lessee hereby assigns to Lessor any of Lessee's rights, title or interest therein, but Lessee may prosecute any claim against the condemning authority in such condemnation proceedings for damages which it may have sustained; provided, however, that no such claim shall diminish or otherwise adversely affect Lessor's award or the award of any fee mortgagee. Section 11. ASSIGNMENT AND SUBLETTING 11.1 Lessee shall not sublet any part of Leased Premises nor assign this Lease, without in each and every case Lessor's prior written consent thereto first had, which consent shall not be unreasonably withheld, provided, however, that Lessee shall remain liable hereunder; nor will Lessee make or permit any transfer of this Lease or any interest hereunder by operation of law. Section 12. LESSOR'S PERFORMANCE OF LESSEE'S COVENANTS 12.1 Should Lessee at any time fail or omit to do any act or thing provided under this Lease to be done by Lessee, Lessor may in its sole discretion after ten (10) days' written notice to Lessee, itself do or cause to be done such act or thing (including the payment of any claim or lien upon Leased Premises made or filed by any laborer, supplier, materialman, principal contractor, subcontractor, or other person, whether for work, labor or services performed upon, or materials supplied to Leased Premises). All monies paid by Lessor shall be and constitute so much additional rental due hereunder from Lessee to Lessor to be due and payable upon notice given by Lessor of the nature and amount thereof, on the first day of the calendar month next succeeding the month during which Lessor shall have given notice, with interest upon any such amount at the rate of ten percent (10%) per annum from the date of payment by Lessor until repayment to Lessor by Lessee. Section 13. RIGHTS RESERVED TO LESSOR 13.1 Lessor reserves the following rights: (a) To have pass keys to Leased Premises and no locks shall be changed without the prior written consent of Lessor; (b) To enter the Leased premises for the purpose of making inspections or repairs, alterations or improvements connected with any portion of Leased premises during reasonable hours, and at any time in the event of an emergency; (c) The show Leased premises to prospective lessees or brokers during the last six months of the Term of this Lease (and if vacated during such period, to prepare Leased Premises for reoccupancy) and to prospective purchasers at all reasonable times, provided prior notice is given to Lessee in each case; (d) To designate and/or approve, prior to installation, all types of window shades, blinds, drapes, awnings, window ventilators, and other similar equipment, and to control all internal lighting that may be visible from the exterior of Building. Section 14. SUBORDINATION TO EXISTING AND FUTURE MORTGAGES 14.1 At the option of Lessor's mortgagee, this Lease shall be subject and subordinate at all times to the lien of any existing mortgage or mortgages and of mortgages which hereafter way be made a lien on Site and/or -6- Building; provided that so long as Lessee is not in default under this Lease, its possession of Leased premises and its rights and privileged hereunder shall not be interfered with by the mortgagee or any purchaser upon a foreclosure of such mortgage. Although no instrument or act on the part of the Lessee shall be necessary to effectuate such subordination, the Lessee shall nevertheless execute and deliver such further instruments subordinating this Lease to the lien of any such mortgages as may be desired by the mortgagee, provided the same acknowledges Lessee's rights as hereinbefore specified. The Lessee hereby appoints the Lessor its attorney-in-fact irrevocably to execute and deliver any such instrument for the Lessee. Section 15. RIGHTS AND REMEDIES OF LESSOR 15.1 If default shall be made in the payment of any sum required to be paid by Lessee under this Lease, and default shall continue for five (5) days after written notice to Lessee, or default shall be made in the performance of any of the other covenants or conditions which Lessee is required to observe and perform, and such default shall continue for fifteen (15) days after written notice to Lessee, or if the interest of Lessee under this Lease shall be levied on under execution or other legal process, or if any petition shall be filed by or against Lessee to declare Lessee a bankrupt or to delay, reduce or modify Lessee's debts or obligations, or if any petition shall be filed or other action taken to reorganize or modify Lessee's capital structure if Lessee be a corporation or other entity, or if Lessee be declared insolvent according to law, or if any assignment of Lessee's property shall be made for the benefit of creditors, or if a receiver or trustee is appointed for Lessee or its property, or if Lessee shall abandon Leased premises during the term of this Lease, then Lessor may treat the occurrence of any one or more of the foregoing events as a breach of this Lease (provided that no such levy, execution, legal process or petition filed against Lessee shall constitute a breach of this Lease if Lessee shall vigorously contest the same by appropriate proceedings and shall remove or vacate the same within thirty (30) days from the date of its creation, service or filing.) and thereupon, at its option, may without notice or demand of any kind to Lessee or any other person, have any one or more of the following described remedies in addition to all other rights and properties provided at law or in equity: (a) Lessor may terminate this Lease and forthwith repossess Leased Premises and be entitled to recover forthwith as damages a sum of money equal to the balance of the Term Rent then remaining unpaid hereunder (without commutation, in consideration of disregarding any rent adjustments pursuant to Section 1.2 hereof) less the fair rental value of Leased premises for said period, and any other sum of money and damages owed by Lessee to Lessor; (b) Lessor may terminate Lessee's right of possession and may repossess Leased Premises by forcible entry or detainer suit or otherwise, without demand or notice of any kind to Lessee and without terminating this Lease, in which event Lessor may, but shall be under no obligation so to do, relet the same for the account of Lessee for such rent and upon such terms as still be satisfactory to Lessor. For the purpose of such reletting Lessor is authorized to decorate or to make any repairs, changes, alterations or additions in or to Leased Premises that may be necessary or convenient, and if Lessor shall fail or refuse to relet Leased Premises, or if the same are relet and a sufficient sum shall not be realized from such reletting after paying all of the costs and expenses of such decorations, repairs, changes, alterations and additions and the expense of such releting and of the collection of the rent accruing therefrom to satisfy the rent provided for in this Lease to be paid, then Lessee shall pay to Lessor as damages a sum equal to the amount of the rental reserved in this Lease for such period or periods, or if the Leased premises have been relet the Lessee shall satisfy and pay any such deficiency upon demand therefor from time to time and Lessee agrees that Lessor may file suit to recover any sums falling due under the term of this Section 15.1(b) from time to time, and that no delivery or recovery of any portion due Lessor hereunder shall be any defense to any subsequent action brought for any amount not theretofore reduced to judgment in favor of Lessor. 15.2 Upon the termination of this Lease or upon the termination of Lessee's right of possession, Lessee shall at once surrender possession of Leased Premises to Lessor and remove all effects therefrom, and if -7- such possession is not immediately surrendered Lessor may forthwith re-enter Leased Premises and repossess itself as of its former estate and remove all persons and effects therefrom, using such force as may be necessary without being guilty of any manner of trespass or forcible entry or detainer. Without limiting the generality of the foregoing, Lessee agrees to remove, at the termination of this Lease or upon the termination of Lessee's right of possession, Lessee's movable furniture, signs, trade fixtures, machinery, equipment and other personal property and such alterations, improvements and additions made by Lessee as may be requested by Lessor. If Lessee shall fail or refuse to remove all such property from Leased Premises, Lessee shall be conclusively presumed to have abandoned the same and title thereto shall thereupon pass to Lessor without any cost, either by setoff, credit, allowance or otherwise, and Lessor may, at its option, accept the title to such property or at Lessee' s expense, may remove the same, or any part thereof, in any manner that Lessor shall choose, and store the same without incurring liability to Lessee or any other person. 15.3 Lessee shall pay, upon demand, all of Lessor's costs, charges, and expenses, including the fees of counsel, agents and other retained by Lessor, at any time incurred in enforcing Lessee's obligations hereunder (whether incurred in litigation or otherwise) or incurred by Lessor in any litigation, negotiation or transaction in which Lessee causes Lessor, without Lessor's fault, to become involved or concerned. Section 16. HOLDING OVER 16.1 Lessee shall pay to Lessor Holdover Rental for each day Lessee shall retain possession of Leased Premises, or any part thereof, after the termination of this Lease, whether by lapse of time or otherwise and shall also pay all damages sustained by Lessor on account thereof; but the provisions of this article shall not operate as a waiver by Lessor of any right of re-entry hereinbefore provided; nor shall the receipt of said rent or any part thereof, or any other act in apparent affirmance of tenancy, operate as a waiver of the right to forfeit this Lease and the Lease Term hereby granted for the period still unexpired, for a breach of any of the covenants herein. Section 17. NOTICES 17.1 All notices to be given by one party to the other under this Lease shall be in writing, mailed or delivered as follows: if to Lessor, at the place where rent is payable; if to Lessee, at the address of Lessee set forth on the first page hereof until Lessee takes possession of the Leased Premises and thereafter at Leased Premises, provided that either party may, by notice to the other, from time to time designate another address to which notices shall thereafter be addressed. Mailed notices shall be sent by United States Certified or Registered, mail postage prepaid. Such notices shall have been deemed to have been given by posting in the United States Mails. Section 18. ESTOPPEL CERTIFICATE 18.1 Lessee shall at any time and from time to time within ten (10) days after written request from Lessor execute, acknowledge and deliver to Lessor, in form reasonably satisfactory to Lessor and/or Lessor's mortgagee, a written statement certifying (if true) that Lessor has accepted the Leased Premises, that this Lease is unmodified and in full force and effect (or if there have been modifications, that the same is in full force and effect as modified and stating the modifications,) that the Lessor is not in default hereunder, the date to which the rental and other charges have been paid in advance, if any, and such other accurate certifications as may reasonably be required by Lessor or Lessor's mortgagee, and agreeing to give copies to any mortgagee of Lessor of all notices by Lessee to Lessor. It is intended that any such statement delivered pursuant to this subsection may be relied upon by any prospective purchaser or mortgagee of the Leased Premises and their respective successors and assigns. -8- Section 19. COVENANT OF QUIET ENJOYMENT 19.1 Lessor further agrees that at all times when Lessee is not in default under the terms of and during the term of this Lease, Lessee's quiet and peaceable enjoyment of the Leased Premises shall not be disturbed or interfered with by Lessor or by any person claiming by, through or under Lessor. Section 20. POSSESSION 20.1 Lessor shall construct, or cause to be constructed, the Leased Premises in accordance with the provisions of Exhibit B attached hereto, including building standard work therein described. 20.2 Construction shall be commenced and diligently pursued in order to have the Leased Premises substantially completed on or before the date specified for commencement of the Lease Term, provided that if construction is delayed because of changes, deletions or addition in construction requested by Lessee, strikes, lockouts, casualties, acts of God, war, material or labor shortages, governmental regulation or control or other causes beyond the control of Lessor, the construction time period shall be extended for the amount of time Lessor is so delayed, and Monthly Installments of rental shall abate pro rata until substantial completion and delivery of possession. 20.3 Lessor shall notify Lessee as soon as the Leased Premises are substantially completed. In the event that there is a dispute as to whether or not the Leased Premises are substantially completed, the dispute shall be resolved by the architect for the Building. Taking of possession by Lessee shall be deemed conclusively to establish that the Leased Premises have been completed in accordance with the said Exhibit B. If Lessor gives possession prior to the commencement date to enable Lessee to fit the Leased Premises to its use, such occupancy shall be subject to all the terms and conditions of this Lease (except that Lessee shall not be required to pay rent or taxes during such occupancy). Section 21. ACTS SUBSEQUENT TO TERMINATION 21.1 No receipt of money by Lessor from Lessee after the termination of this Lease, the service of any notice, the commencement of any suit or final judgment for possession shall reinstate, continue to extend the term of this Lease or affect any such notice, demand, suit or judgment. Section 22. WAIVER OF DEFAULT 22.1 No waiver of default of Lessee shall be implied, and no express waiver shall affect any default other than the default specified in such waiver and that only for the time and to the extent therein stated. The invalidity or unenforceability of any provision of this Lease shall not affect or impair any other provision. Section 23. EXAMINATION OF LEASE 23.1 Submission of this instrument for examination or signature by Lessee does not constitute a reservation of or option for lease, and it is not effective as a lease or otherwise until execution and delivery by both Lessor and Lessee. Section 24. DEFAULT UNDER OTHER LEASE 24.1 If the term of any lease, other than this Lease, made by Lessee, for the Leased Premises or any part thereof, or for any other space in the Building shall be terminated or terminable after the making of this Lease, because of any default by Lessee under such other lease, such fact shall empower Lessor, at Lessor's sole option, to terminate this Lease by notice to Lessee and/or to exercise any of the remedies set forth in Section 15. -9- Section 25. REPRESENTATIVE CAPACITY 25.1 No person, partnership, corporation or other organization executing this Lease in a representative capacity for Lessor or Lessee shall be held individually liable hereunder in the absence of fraud provided such person, partnership, corporation or other organization acted with due authority and the intended principals are bound. Section 26. MISCELLANEOUS 26.1 All rights and remedies of Lessor and Lessee under this Lease shall be cumulative and none shall exclude any other rights and remedies allowed by law or statute. 26.2 Each of the provisions of this Lease shall extend to and shall, as the case may require, bind or inure to the benefit, not only of Lessor and of Lessee, but also of their respective heirs, legal representatives, successors and permitted assigns, provided this clause shall not permit any assignment contrary to the provisions of Section 11 hereof. 26.3 All of the representations and obligations of Lessor and Lessee are contained herein and no modification, waiver or amendment of this Lease, or any of its conditions or provisions, shall be binding upon the Lessor and Lessee unless in writing, signed by Lessor and Lessee. 26.4 The receipt by Lessor of any installment of the regular stipulated rent hereunder or any of said additional rent, shall not be a waiver of any other additional rent then due or of any default of Lessee hereunder. 26.5 This Lease may be executed in any number of counterparts. Each such executed counterpart shall be deemed an original hereof and all such executed counterparts shall together constitute but one and the same instrument, which instrument shall for all purposes be sufficiently evidenced by such executed counterpart. 26.6 The section and paragraph headings of this Lease are for convenience only and in no way limit or enlarge the scope or meaning of the language contained in the body of this Lease. 27.0 Build as per plan. Carpet. Paint. Install door opening between Units 8NE & 9N, Install wall & opening in 9N. -10- INITIAL - ---------- Landlord Tenant - ---------- WILLOW LAKE OFFICE CENTER ------------------------- SITE PLAN "EXHIBIT A" WILLOW LAKES OFFICE CENTER -------------------------- FLOORPLAN INITIAL Landlord Tenant Exhibit 1.1.2.(3) LEASE THIS LEASE, made September 16, 1994 between Willowbrook Office an Illinois limited partnership, sole beneficiary of American National Bank and Trust Company of Chicago, as Trustee under Trust Agreement dated March 1, 1979 and known as Trust No. 46058 (herein called Lessor), and THE LAND SALES ------------------------ RESOURCE, INC. - ------------------------------------------------------------------------------- (herein called Lessee), whereby Lessee has leased from Lessor, and Lessor has demised to Lessee, certain premises containing approximately 1,089 square feet, and designated as Unit 20E (herein called Leased Premises), as outlined in red on the attached (Exhibit A) building floor plan, in the building (herein called Building) on Lot 1 in the Resubdivision of Lot 35 in Willowbrook Executive Plaza, Willowbrook, Illinois situated on a parcel of ground (herein called Site), the vacant portion of which is improved with parking areas, driveways and landscaping. The Lease term will be for a term of Two Years Seven Months and will commence on October 1, 1994 and terminate April 30, 1997 (herein called Lease Term). The term rental will be $36,164.86 (herein called Term Rent) payable monthly in advance in installments of $ * each (herein called Monthly ------ Installments). "Lessee's Proportionate Share" as such term is hereinafter used shall be 2.15%. Lessee has deposited with Lessor's beneficiary the sum of $1,137.10 as Security Deposit. Leased Premises shall be used only for General Office (herein called the Specified Use). "Holdover Rental" as such - --------------- term is hereinafter used, shall be the amount of the Monthly Installment for the last month of the Lease Term divided by fifteen. Until otherwise notified in writing by Lessor, the Term Rental, Monthly Installments and all other sums to be paid by Lessee to Lessor hereunder shall be made payable to the order of' Willowbrook Ofc. Partnership, 650 Executive Drive, Willowbrook, Illinois 60521. IN WITNESS WHEREOF, the parties have executed this Lease the day and year first above written, intending thereby to incorporate and include therein, all terms, conditions and provisions contained in Sections 1 through 27 attached hereto as though the said Sections had been hereinbefore fully set forth. LESSOR: LESSEE: Willowbrook Office Partnership THE LAND SALES RESOURCE, INC. 622 Executive Drive Willowbrook, Ill. 60521 By: /s/ DON J. WISKES By: /s/ KITTY M. LAYNE President -------------------------- ----------------------------------- General Partner (Title) ATTEST: *10-1-94--10-31-95....$1,137.10/mo. 11-1-95--4-30-97......$1,187.92/mo. /s/ CHERYL A. BENTLEY ------------------------------------- (Title) ADDRESS OF LESSEE: 7660 Plaza Court Willowbrook, Illinois 60521 9/16/94 #3
INITIAL Landlord Tenant IN CONSIDERATION WHEREOF, THE PARTIES HERETO COVENANT AND AGREE AS FOLLOWS: Section 1. RENTAL 1.1 Lessee agrees to pay the Term Rent to Lessor in Monthly Installments payable one each in advance on or before the first day of every calendar month of the Lease Term, in lawful money of the United States or by good check or draft (subject to collection). 1.2 Lessee shall pay to Lessor, as additional rental, (a) Lessee's Proportionate Share of the amount by which the general real estate taxes payable during each year of the Lease Term on the Building and Site of which Leased Premises are a part exceed the amount of .80 cents per square foot of Building and (b) Lessee's Proportionate Share of installments of special assessments, if any, payable during each year of the Lease Term applicable to the Building and Site of which the Leased Premises are a part. Lessee shall not be liable for any special assessments for improvements completed prior to the commencement date of the Lease Term, nor for any income or other taxes, of the Lessor. 1.3 Lessee shall pay to Lessor as additional rental for each year of the Lease Term Lessee's Proportionate Share of the amount by which the cost of common area maintenance (as hereinafter defined) incurred by Landlord during such year exceeds .41 cents per square foot of Building. Common area maintenance includes the operation, repair and replacement of parking areas, driveways, sidewalks, landscaped areas, drainage facilities and exterior lighting on the Site, and, without limiting the generality of the foregoing, snow and ice removal from and sweeping of the parking areas, driveways and sidewalks. 1.3A. Insurance. Lessee shall pay to Lessor as additional rental for each year of the lease term Lessee's proportionate share of the amount by which the premium cost of Lessor's extended coverage insurance, with all endorsements, on all public liability and property damage insurance exceeds .0849 per square foot of building. 1.4 lessor shall submit to Lessee annual statements showing the computations of the amount of Lessee's liability, if any, under Sections 1.2 and 1.3, which amount Lessee shall pay to Lessor on or before thirty (30) days immediately following delivery of such statement. Such amounts shall be prorated as of the commencement date for the first year of the Lease Term and as of the termination date for the last year of the Lease Tenn. 1.5 The Term Rent and additional rental shall be paid by Lessee promptly when due, without any deduction or setoff whatsoever. Any such amount not paid when due shall bear interest at the rate of 18% per annum from the due date until paid. Section 2. SECURITY DEPOSIT 2.1 The Security Deposit may be applied by Lessor the purpose of curing any default or defaults of Lessee under this Lease. If said sum or any part thereof is used, applied or retained in curing any such default, Lessee shall, upon demand, immediately deposit with Lessor an amount in cash equal to the amount so used, applied or retained. Default by lessee in paying to Lessor any amount required to restore the Security Deposit after any application thereof, shall afford to Lessor the same remedies as in the default of the payment of the rent. If Lessee has not defaulted here under, or if Lessor has not applied said sum to said default, then the Security Deposit or any portion thereof not so applied by Lessor shall be paid to Lessee within thirty (30) days after the termination of this Lease, provided Lessee has surrendered possession of the Leased Premises in accordance with the provisions of this Lease. In the event of a bona-fide sale of the Site and the Building, Lessor shall have the right to transfer the Security Deposit to the purchaser to be held under the term of this Lease and, in such event, Lessor shall be released from all liability for the return of such Security Deposit to Lessee. Section 3. UTILITY SERVICES 3.1 Lessee shall promptly pay for all public utilities rendered or furnished, and metered to the Leased Premises during the term of this Lease. Lessee shall not waste or permit the waste of water, or use the water for any purpose other than those stated. Lessor periodically will bill Lessee for Lessee's Proportionate Share of all -2- water bills received by Lessor for water metered to the Building and Lessee shall pay such amount not later than the date for the next Monthly Installment. Lessee may, at its own cost, install a submeter to meter water delivered to the Leased Premises and in such event Lessee shall be free of the restrictions regarding water usage and shall pay Lessor for water used according to meter readings (at the rate charged by the supplier of such water) in lieu of paying the aforesaid percentage of bills for all water metered to the Building. All leases heretofore or hereafter executed with respect to premises in the Building will contain identical restrictions with respect to the use, misuse or wasting of water, except where the Lessee installs a submeter at its cost (and such submetered water will be deducted prior to computing Lessee's obligation for such water bills). Lessor shall not be liable for damages, by abatement of rent or otherwise, for interruption or failure of, or delay in, furnishing any service or utility, whether the responsibility of Lessor or of others, when the same is occasioned by causes beyond the reasonable control of Lessor, and no such interruption, failure or delay shall be deemed an eviction or disturbance of Lessee's use of the Leased Premises. Section 4. USE 4.1 Lessee may use the Leased Premises for the Specified Use. Lessee shall not injure, overload, deface or otherwise harm Site, Building or Leased Premises nor permit the same; nor commit any nuisance; nor permit the emitting of any objectionable noise or odor; nor burn any trash or refuse thereon or therein; nor manufacture, sell, display, distribute or give away any alcoholic liquors or beverages; nor make or permit any use of Leased Premises which is improper, offensive or contrary to any law or ordinance, or which will invalidate or increase the cost of any Lessor's insurance (including the keeping or storage of any article of dangerous, inflammable or explosive character) or which would increase the danger of fire in Leased Premises or in the Building; nor obstruct or permit the obstruction of driveways, walks, parking areas and other common areas of Site. 4.2 Lessee shall not exhibit, inscribe, paint or affix any sign, advertisement, notice or other lettering (hereinafter referred to as "signs") on any part of the Site, exterior of the Building, or in the windows, without the express prior written consent of Lessor, which consent will not be unreasonably withheld. Lessor shall have, at any time and from time to time, the right to establish rules and regulations setting forth uniform characteristics for all signs on the Building and Site, and Lessor's refusal to consent to any sign not meeting such characteristics shall not be deemed to be unreasonable. In the event of the violation of the foregoing, Lessor may remove same without any liability, and may charge the expense incurred by such removal to Lessee. Subject to applicable laws, ordinances and regulations, Lessee may, however, place a sign on the front door of Leased Premises which sign shall be installed by Lessor at the expense of Lessee, and shall be (i) for identification purposes only; (ii) uniform with all other such signs on Building; and (iii) of a size, color and style acceptable to Lessor. Section 5. CONDITION OF PREMISES 5.1 Lessee's taking possession of the Leased Premises shall be conclusive evidence that Leased Premises were in good order and satisfactory condition when Lessee took possession, with the exception of those items if any, detailed in a written list executed by Lessor and Lessee at or prior to acceptance of possession. No promise of Lessor to alter, remodel, complete or improve Leased Premises or Building or Site, and no representation concerning the condition of Leased Premises or Building or Site have been made by Lessor to Lessee unless same is contained herein or is contained in agreed plans and specifications signed by both parties. At the termination of this Lease by lapse of time or otherwise, Lessee shall return Leased Premises in good order and condition, loss or damage by fire or other casualty, conditions which are the responsibility of Lessor to repair pursuant to the term of Section 6.1 hereof, and ordinary wear and tear excepted. Section 6. MAINTENANCE AND ALTERATIONS 6.1 Maintenance. Lessor shall keep and maintain the roof and structural members of the Building of which the Leased Premises are a part, and the parking lot, sidewalks and landscaping on the Site in good order and repair, except for loss by fire or other casualty covered by Section 9 of this Lease, and shall remove snow accumulations from the parking lot and sidewalks. Lessee shall keep and maintain the balance of the exterior and the entire interior of the Leased Premises clean and sanitary and in good condition and repair including, without -3- limitation, any necessary replacements (and further including, without limitation, necessary interior painting and window replacement). Lessee shall fully comply with all health and police regulations in force and shall conform with the rules and regulations of fire underwriters or their fire protection engineers. Lessor will obtain the qualified Contractor to inspect and maintain the HVAC equipment at Lessee's premises. Lessor will bill Lessee monthly commencing Oct. 1, 1994. The cost will be $35.00 per month and will be billed and payable with your monthly rent. Lessee shall promptly remove any debris left in the working area or other exterior areas of the Site by Lessee, its employees, agents or contractors. 6.2 Alterations. Lessee shall not create any openings in the roof or exterior walls, nor shall Lessee make any alterations or additions to the Leased Premises. Lessee shall make all additions, improvements, alterations and repairs on the Leased Premises and on and to the appurtenances and equipment thereof if required by any governmental authority or which may be made necessary by the act or neglect of any person, firm or corporation (public or private). Upon completion of any work by or on behalf of Lessee, Lessee shall provide Lessor with such documents as Lessor may require (including, without limitation, sworn contractor's statements and supporting lien waivers) evidencing payment in full for such work. Section 7. INDEMNIFICATION AND RELEASE OF CLAIMS 7.1 Lessee will at all times hold Lessor, its beneficiaries and the management of the Building harmless and indemnified against any loss, damage, cost, expense or liability resulting to any person or property by reason of any use which may be made of the Leased Premises or any part thereof, or by reason of any act or thing done or omitted to be done in, upon or about Leased Premises or any part thereof, unless such loss, damage, cost, expense or liability shall be caused by the sole negligence of Lessor; and Lessee will hold Lessor and Site, Building and Leased Premises harmless, indemnified and free and clear of any and all claims, demands, penalties, liabilities, judgments, costs and expenses, including reasonable attorneys' fees, arising in connection with any use of Leased Premises by Lessee or its employees, agents or servants. 7.2 Only to the extent that such business interruption, loss or damage to property or injury to or death of persons is covered by insurance, neither Lessor nor Lessee shall be liable to the other for any business interruption or any loss or damage to property or injury to or death of persons occurring on Site, in Building or in Leased Premises or in any manner growing out of or connected with the Lessee's use and occupation of Leased Premises, Building and Site, or the condition thereof, whether or not caused by the negligence or other fault of Lessor or Lessee, or of their respective agents, employees, subtenants, licensees, or assignees. Nothing herein shall be construed to impose any other or greater liability upon either Lessor or Lessee than would have existed in the absence of this Section 7.2. This release shall be in effect only so long as the applicable insurance policies contain a clause to the effect that this release shall not affect the right of the insured to recover under such policies. Such clauses shall be obtained by the parties whenever possible. The release in favor of Lessor contained herein, is in addition to, and not in substitution for, or in diminution of the hold harmless and indemnification provisions of Section 7.I thereof. Section 8. INSURANCE 8.1 At all times during the Lease Term Lessee shall, at its sole cost and expense, maintain: (a) Comprehensive General Public Liability Insurance against claims for personal injury, death or property damage occurring in connection with the use and occupancy of Leased Premises, naming Lessee and Lessor, Lessor's beneficiaries and the management of Building as the named insureds, such insurance to afford protection to the limit of not less than Five Hundred Thousand ($500,000.00) INITIAL Landlord Tenant -4- Dollars in respect to injury or death of a single person, and to the limit of not less than One Million ($1,000,000.00) Dollars in respect to any one accident, and to the limit of not less than One Hundred Thousand ($100,000.00) Dollars in respect to property damage. (b) Steam Boiler Insurance an all steam boilers, pressure tanks and other such apparatus, if any shall, from time to time, be installed on Leased Premises, in such amount as Lessor may from time to time reasonably require. (c) At all times when any work is in process in connection with any change or alteration being made by Lessee, Lessee shall maintain Workmen's Compensation insurance covering all persons employed in connection with the work and with respect to whom death or bodily injury claims could be asserted against Lessor or its beneficiaries, as well as Lessee or Leased Premises. 8.2 Lessee shall furnish Lessor with a duplicate certificate or certificates of such insurance and not less than ten (10) days prior to the expiration date of any policy, will furnish Lessor with a new policy or certificate therefor or a renewal thereof, in substitution of the expiring policy. Each such policy which Lessee is required to procure and maintain hereunder shall be issued by insurers of recognized responsibility licensed to do business in Illinois, and shall contain an agreement or endorsement that it will not be cancelled by the insurer without at least ten (10) days' prior written notice to Lessor. 8.3 Lessee will not do, suffer or permit any act or omission, whether on Leased Premises or otherwise, which might or would result in voiding or impairing the obligation of any such policy of insurance. Section 9. FIRE AND CASUALTY. 9.1 If Leased Premises or Building are substantially destroyed or rendered untenantable by fire or other casualty, Lessor shall have the right to terminate this Lease by notice in writing to Lessee mailed within thirty (30) days of the fire or other casualty. In any case of fire or other casualty damage to Leased Premises (except where this Lease is terminated by Lessor as hereinbefore provided), Lessor shall repair and rebuild Leased Premises within one hundred and fifty (150) days of the fire or other casualty, and, upon failing to do so, Lessee shall have the right to terminate this Lease by notice in writing to Lessor failed within twenty (20) days thereafter. If any such fire or other casualty renders Leased premises or any portion thereof untenantable, the rent to be paid by Lessee hereunder shall abate by an amount bearing the same ratio of the total amount of rent for the period of untenantability as the untenantable portion of Leased Premises bears to the entire Leased Premises during the period beginning with the date of such fire or other casualty and ending with the date when Leased Premises are again rendered tenantable. Section 10. CONDEMNATION 10.1 If the whole of Leased premises shall be taken for any public or quasi-public use under statute or by right of eminent domain or by private purchase in lieu thereof, then this Lease shall automatically terminate as of the date that title shall be taken. If any portion of Leased premises shall be so taken as to render the remainder thereof unusable for the purpose for which Leased Premises were leased, then Lessor and Lessee shall each have the right to terminate this Lease on thirty (30) days' notice to the other given within sixty (60) days after the date of such taking. In the event neither party shall exercise the aforesaid right to terminate, the rent payable under this Lease shall be equitably apportioned according to the space so taken, and Lessor shall, at its own cost and expense, restore the remaining portion of Leased Premises to the extent necessary to render it reasonably suitable for the purposes for which it was leased and shall make all repairs to Building to the extent necessary to constitute Building a complete architectural unit, provided the cost thereof shall not exceed the proceeds of Lessor's condemnation award. Lessee shall not be entitled to receive any part of any award or awards based upon taking of the fee or lease hold interest, which shall be the property of Lessor, and Lessee hereby assigns to Lessor any of Lessee's rights, title or interest therein, but Lessee may prosecute any claim against the condemning authority in such condemnation proceedings for damages which it may have sustained; provided, however, that no such claim shall diminish or otherwise adversely affect Lessor's award or the award of any fee mortgagee. -5- Section 11. ASSIGNMENT AND SUBLETTING 11.1 Lessee shall not sublet any part of Leased Premises nor assign this Lease, without in each and every case Lessor's prior written consent thereto first had, which consent shall not be unreasonably withheld, provided, however, that Lessee shall remain liable hereunder; nor will Lessee make or permit any transfer of this Lease or any interest hereunder by operation of law. Section 12. LESSOR'S PERFORMANCE OF LESSEE'S COVENANTS 12.1 Should Lessee at any time fail or omit to do any act or thing provided under this Lease to be done by Lessee, Lessor may in its sole discretion after ten (10) days' written notice to Lessee, itself do or cause to be done such act or thing including the payment of any claim or lien upon Leased Premises made or filed by any laborer, supplier, materialman, principal contractor, subcontractor, or other person, whether for work, labor or services performed upon, or materials supplied to Leased Premises). All monies paid by Lessor shall be and constitute so much additional rental due hereunder from Lessee to Lessor to be due and payable upon notice given by Lessor of the nature and amount thereof, on the first day of the calendar month next succeeding the month during which Lessor shall have given notice, with interest upon any such amount at the rate of ten percent (10%) per annum from the date of payment by Lessor until repayment to Lessor by Lessee. Section 13. RIGHTS RESERVED TO LESSOR 13.1 Lessor reserves the following rights: (a) To have pass keys to Leased Premises and no locks shall be changed without the prior written consent of Lessor; (b) To enter the Leased premises for the purpose of making inspections or repairs, alterations or improvements connected with any portion or Leased premises during reasonable hours, and at any time in the event of an emergency; (c) To show Leased premises to prospective lessees or brokers during the last six months of the Term of this Lease (and if vacated during such period, to prepare Leased Premises for reoccupancy) and to prospective purchasers at all reasonable times, provided prior notice is given to Lessee in each case; (d) To designate and/or approve, prior to installation, all types of window shades, blinds, drapes, awnings, window ventilators, and other similar equipment, and to control all internal lighting that may be visible from the exterior of Building. Section 14. SUBORDINATION TO EXISTING AND FUTURE MORTGAGES 14.1 At the option of Lessor's mortgagee, this Lease shall be subject and subordinate at all times to the lien of any existing mortgage or mortgages and of mortgages which hereafter may be made a lien on Site and/or Building; provided that so long as Lessee is not in default under this Lease, its possession of Leased premises and its rights and privileges hereunder shall not be interfered with by the mortgagee or any purchaser upon a foreclosure of such mortgage. Although no instrument or act on the part of the Lessee shall be necessary to effectuate such subordination, the Lessee shall nevertheless execute and deliver such further instruments subordinating this Lease to the lien of any such mortgages as may be desired by the mortgagee, provided the same acknowledges Lessee's rights as hereinbefore specified. The Lessee hereby appoints the Lessor its attorney-in-fact irrevocably to execute and deliver any such instrument for the Lessee. Section 15. RIGHTS AND REMEDIES OF LESSOR 15.1 If default shall be made in the payment of any sum required to be paid by Lessee under this Lease, and default shall continue for five (5) days after written notice to Lessee, or default shall be made in the -6- performance of any of the other covenants or conditions which Lessee is required to observe and perform, and such default shall continue for fifteen (15) days after written notice to Lessee, or if the interest of Lessee under this Lease shall be levied on under execution or other legal process, or if any petition shall be filed by or against Lessee to declare Lessee a bankrupt or to delay, reduce or modify Lessee's debts or obligations, or if any petition shall be filed or other action taken to reorganize or modify Lessee's capital structure if Lessee be a corporation or other entity, or if Lessee be declared insolvent according to law, or if any assignment of Lessee's property shall be made for the benefit of creditors, or if a receiver or trustee is appointed for Lessee or its property, or if Lessee shall abandon Leased premises during the term of this Lease, then Lessor may treat the occurrence of any one or more of the foregoing events as a breach of this Lease (provided that no such levy, execution, legal process or petition filed against Lessee shall constitute a breach of this Lease if Lessee shall vigorously contest the same by appropriate proceedings and shall remove or vacate the same within thirty (30) days from the date of its creation, service or filing) and thereupon, at its option, may without notice or demand of any kind to Lessee or any other Person, have any one or more of the following described remedies in addition to all other rights and remedies provided at law or in equity: (a) Lessor may terminate this Lease and forthwith repossess Leased Premises and be entitled to recover forthwith as damages a sum of money equal to the balance of the Term Rent then remaining unpaid hereunder (without commutation, in consideration of disregarding any rent adjustments pursuant to Section 1.2 hereof) less the fair rental value of Leased premises for said period, and any other sum of money and damages owed by Lessee to Lessor; (b) Lessor may terminate Lessee's right of possession and may repossess Leased Premises by forcible entry or detainer suit or otherwise, without demand or notice of any kind to Lessee and without terminating this Lease, in which event Lessor may, but shall be under no obligation so to do, relet the same for the account of Lessee for such rent and upon such terms as shall be satisfactory to Lessor. For the purpose of such reletting Lessor is authorized to decorate or to make any repairs, changes, alterations or additions in or to Leased Premises that may be necessary or convenient, and if Lessor shall fail or refuse to relet Leased Premises, or if the same are relet and a sufficient sum shall not be realized from such reletting after paying all of the costs and expenses of such decorations, repairs, changes, alterations and additions and the expense of such releting and of the collection of the rent accruing therefrom to satisfy the rent provided for in this Lease to be paid, then Lessee shall pay to Lessor as damages a sum equal to the amount of the rental reserved in this Lease for such period or periods, or if the Leased premises have been relet the Lessee shall satisfy and pay any such deficiency upon demand therefor from time to time and Lessee agrees that Lessor may file suit to recover any sums falling due under the terms of this Section 15.1 (b) from time to time, and that no delivery or recovery of any portion due Lessor hereunder shall be any defense to any subsequent action brought for any amount not theretofore reduced to judgment in favor of Lessor. 15.2 Upon the termination of this Lease or upon the termination of Lessee's right of possession, Lessee shall at once surrender possession of Leased Premises to Lessor and remove all effects therefrom, and if such possession is not immediately surrendered Lessor may forthwith re-enter Leased Premises and repossess itself as of its former estate and remove all persons and effects therefrom, using such force as may be necessary without being guilty of any manner of trespass or forcible entry or detainer. Without limiting the generality of the foregoing, Lessee agrees to remove, at the termination of this Lease or upon the termination of Lessee's right of possession, Lessee's movable furniture, signs, trade fixtures, machinery, equipment and other personal property and such alterations, similar improvements and additions made by Lessee as may be requested by Lessor. If Lessee shall fail or refuse to remove all such property from Leased Premises, Lessee shall be conclusively presumed to have abandoned the same and title thereto shall thereupon pass to Lessor without any cost, either by setoff, credit, allowance or otherwise, and Lessor may, at its option, accept the title to such property or at Lessee's expense may remove the same, or any part thereof, in any manner that Lessor shall choose, and store the same without incurring liability to Lessee or any other person. 15.3 Lessee shall pay, upon demand, all of Lessor's costs, charges, and expenses, including the fees of counsel, agents and other retained by Lessor, at any time incurred in enforcing Lessee's obligations hereunder -7- (whether incurred in litigation or otherwise) or incurred by Lessor in any litigation, negotiation or transaction in which Lessee causes Lessor, without Lessor's fault, to become involved or concerned. Section 16. HOLDING OVER 16.1 Lessee shall pay to Lessor Holdover Rental for each day Lessee shall retain possession of Leased Premises, or any part thereof, after the termination of this Lease, whether by lapse of time or otherwise and shall also pay all damages sustained by Lessor on account thereof; but the provisions of this article shall not operate as a waiver by Lessor of any right of re-entry hereinbefore provided; nor shall the receipt of said rent or any part thereof, or any other act in apparent affirmance of tenancy, operate as a waiver of the right to forfeit this Lease and the Lease Term hereby granted for the period still unexpired, for a breach of any of the covenants herein. Section 17. NOTICES 17.1 All notices to be given by one party to the other under this Lease shall be in writing, mailed or delivered as follows: if to Lessor, at the place where rent is payable; if to Lessee, at the address of Lessee set forth on the first page hereof until Lessee takes possession of the Leased Premises and thereafter at Leased Premises, provided that either party may, by notice to the other, from time to time designate another address to which notices shall thereafter be addressed. Mailed notices shall be sent by United States Certified or Registered Mail, postage prepaid. Such notices shall have been deemed to have been given by posting in the United States Mails. Section 18. ESTOPPEL CERTIFICATE 18.1 Lessee shall at any time and from time to time within ten (10) days after written request from Lessor execute, acknowledge and deliver to Lessor, in form reasonably satisfactory to Lessor and/or Lessor's mortgagee, a written statement certifying (if true) that Lessor has accepted the Leased Premises, that this Lease is unmodified and in full force and effect (or if there have been modifications, that the same is in full force and effect as modified and stating the modifications), that the Lessor is not in default hereunder, the date to which the rental and other charges have been paid in advance, or any, and such other accurate certifications as may reasonably be required by Lessor or Lessor's mortgagee, and agreeing to give copies to any mortgage of Lessor of all notices by Lessee to Lessor. It is intended that any such statement delivered pursuant to this subsection may be relied upon by any prospective purchaser or mortgage of the Leased Premises and their respective successors and assigns. Section 19. COVENANT OF QUIET ENJOYMENT 19.1 Lessor further agrees that at all times when Lessee is not in default under the terms of and during the terms of this Lease, Lessee's quiet and peaceable enjoyment of the Leased Premises shall not be disturbed or interfered with by Lessor or by any person claiming by, through or under Lessor. Section 20. POSSESSION 20.1 Lessor shall construct, or cause to be constructed, the Leased Premises in accordance with the provisions of Exhibit B attached hereto, including building standard work therein described. 20.2 Construction shall be commenced and diligently pursued in order to have the Leased Premises substantially completed on or before the date specified for commencement of the Lease Term, provided that if construction is delayed because of changes, deletions or addition in construction requested by Lessee, strikes, lockouts, casualties, acts of God, war, material or labor shortages, governmental regulation or control or other causes beyond the control of Lessor, the construction time period shall be extended for the amount of time Lessor is so delayed, and Monthly Installments of rental shall abate pro rata until substantial collection and delivery of possession. -8- 20.3 Lessor shall notify Lessee as soon as the Leased Premises are substantially completed. In the event that there is a dispute as to whether or not the Leased Premises are substantially completed, the dispute shall be resolved by the architect for the Building. Taking of possession by Lessee shall be deemed conclusively to establish that the Leased Premises have been completed in accordance with the said Exhibit B. If Lessor gives possession prior to the commencement date to enable Lessee to fit the Leased Premises to its use, such occupancy shall be subject to all the terms and conditions of this Lease (except that Lessee shall not be required to pay rent or taxes during such occupancy). Section 21. ACTS SUBSEQUENT TO TERMINATION 21.1 No receipt of money by Lessor from Lessee after the termination of this Lease, the service of any notice, the commencement of any suit or final judgment for possession shall reinstate, continue to extend the term of this Lease or affect any such notice, demand, suit or judgment. Section 22. WAIVER OF DEFAULT 22.1 No waiver of default of Lessee shall be implied, and no express waiver shall affect any default other than the default specified in such waiver and that only for the time and to the extent therein stated. The invalidity or unenforceability of any provision of this Lease shall not affect or impair any other provision. Section 23. EXAMINATION OF LEASE 23.1 Submission of this instrument for examination or signature by Lessee does not constitute a reservation of or option for lease, and it is not effective as a lease or otherwise until execution and delivery by both Lessor and Lessee. Section 24. DEFAULT UNDER OTHER LEASE 24.1 If the term of any lease, other than this Lease, made by Lessee, for the Leased Premises or any part thereof, or for any other space in the Building and shall be terminated or terminable after the making of this Lease, because of any default by Lessee under such other lease, such fact shall embower Lessor, at Lessor's sole option, to terminate this Lease by notice to Lessee and/or to exercise any of the remedies set forth in Section 15. Section 25. REPRESENTATIVE CAPACITY 25.1 No person, partnership, corporation or other organization executing this Lease in a representative capacity for Lessor or Lessee shall be held individually liable hereunder in the absence of fraud provided such person, partnership, corporation or other organization acted with due authority and the intended principals are bound. Section 26. MISCELLANEOUS 26.1 All rights and remedies of Lessor and Lessee under this Lease shall be cumulative and none shall exclude any other rights and remedies allowed by law or statute. 26.2 Each of the provisions of this Lease shall extend to and shall, as the case may require, bind or inure to the benefit, not only of Lessor and of Lessee, but also of their respective heirs, legal representatives, successors and permitted assigns, provided this clause shall not permit any assignment contrary to the provisions of Section 11 hereof. 26.3 All of the representations and obligations of Lessor and Lessee are contained herein and no modification, waiver or amendment of this Lease, or any of its conditions or provisions, shall be binding upon the Lessor and Lessee unless in writing, signed by Lessor and Lessee. -9- 26.4 The receipt by Lessor of any installment of regular stipulated rent hereunder or any of said additional rent, shall not be a waiver of any other additional rent then due or of any default of Lessee hereunder. 26.5 This Lease may be executed in any number of counterparts. Each such executed counterpart shall be deemed an original hereof and all such executed counterparts shall together constitute but one and the same instrument, which instrument shall for all purposes be sufficiently evidenced by such executed counterpart. 26.6 The section and paragraph headings of this Lease are for convenience only and in no way limit or enlarge the scope or meaning of the language contained in the body of this Lease. 27.0 Lessor will build as per plan. Lessor will carpet entire premises. Lessor will paint entire premises. INITIAL Landlord Tenant -10- WILLOW LAKE OFFICE CENTER ------------------------- SITE PLAN EXHIBIT A WILLOW LAKES OFFICE CENTER -------------------------- FLOOR PLAN INITIAL Landlord Tenant EXHIBIT "B" CLC Plan Agreement Exhibit 1.1.3 =============================================================================== CAMADON(TM) CORPORATE OFFICE: Pewaukee, WI 414/544-9200 . fax: 414/544-4488 REGIONAL OFFICE: Vernon Hills, IL . 708/362-5100 . fax 708/362-5114 REGIONAL OFFICE: Madison, WI . 608/233-3880 . 608/223-3890
Agreement No._____ Date______ Customer No.____ - -------------------------------------------------------------------------------------------------------------------------------- BILL TO: SHIP TO: - -------------------------------------------------------------------------------------------------------------------------------- Name (Full Legal Name) Name The Land Sales Resource Same - -------------------------------------------------------------------------------------------------------------------------------- Address Address 622 Executive Dr. - -------------------------------------------------------------------------------------------------------------------------------- City/State City/State Zip Code Willow Brook, IL 60521 - --------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------- INITIAL PERIOD: CHARGES AND COPIES PER COPY PERIOD: - -------------------------------------------------------------------------------------------------------------------------------- Term/Payment Frequency Agreed Minimum Monthly Volume X Base Copy Rate = Minimum [_] plus tax Advance Monthly Copy Payments Charges: [X] incl tax 60 month 29,000 .024 696.00 1392.00 - -------------------------------------------------------------------------------------------------------------------------------- Meter Reading Frequency Excess Copy Charge .0135 Please check one: (Circle One) M Q S A ----- [_] Aggregate Minimum [_] Per Machine Minimum - -------------------------------------------------------------------------------------------------------------------------------- PLEASE FURNISH THE FOLLOWING INFORMATION - -------------------------------------------------------------------------------------------------------------------------------- Make/Model Serial # Per Machine Make/Model SeriaL # Per Machine Allowance Allowance - -------------------------------------------------------------------------------------------------------------------------------- FT-6655 - -------------------------------------------------------------------------------------------------------------------------------- Sorter/Stapler - -------------------------------------------------------------------------------------------------------------------------------- DOC Feeder - -------------------------------------------------------------------------------------------------------------------------------- Power Cond. - --------------------------------------------------------------------------------------------------------------------------------
Dear User: We have written this Agreement in plain language because we want you to fully understand its terms. Please read your copy of this Agreement carefully and feel free to ask us any questions you may have about it. We use the words "you" and "your" to mean the user named below. The words "we", "us" and "our" refer to the Owner named below. IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT (INCLUDING THOSE ON THE REVERSE SIDE) SHOULD BE READ CAREFULLY, BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN AGREEMENT MAY BE LEGALLY ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT. YOU AGREE TO COMPLY WITH THE TERMS AND CONDITIONS OF THIS AGREEMENT. THIS AGREEMENT IS NOT CANCELLABLE. YOU PROMISE THAT THE EQUIPMENT WILL BE USED ONLY FOR BUSINESS PURPOSES TERMS AND CONDITIONS (CONTINUED ON REVERSE SIDE) 1. AGREEMENT. You agree to rent from us and we agree to rent to you the Equipment listed above. You promise to pay not less than the Minimum Monthly Copy Charge every month during the Initial Term. WE WILL PROVIDE THE EQUIPMENT AND FULL SERVICE MAINTENANCE DURING NORMAL BUSINESS HOURS, INCLUDING ALL SUPPLIES AND PARTS NECESSARY TO PRODUCE COPIES, EXCEPT PAPER WHICH YOU MUST PURCHASE SEPARATELY. YOU AGREE THAT WE CAN INCREASE THE MINIMUM MONTHLY COPY CHARGE ANNUALLY AFTER TWELVE MONTHS HAVE ELAPSED UNDER THIS AGREEMENT BY AN AMOUNT NOT GREATER THAN THE PREVIOUS YEAR'S INFLATION RATE AS MEASURED BY THE CONSUMER PRICE INDEX. You agree to pay for service outside of normal business hours or service required by your negligence or misuse of the Equipment at our customary rates. - ------------------------------------------------------------------------------ YOU AGREE WITH US TO USE THE EQUIPMENT FOR THE INITIAL PERIOD IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS AGREEMENT (INCLUDING THOSE ON THE REVERSE SIDE) AND NOT TO PAY LESS THAN THE MINIMUM MONTHLY COPY CHARGE PAYMENT EACH MONTH. YOU PROMISE THAT ALL THE INFORMATION GIVEN IN THIS AGREEMENT AND YOUR APPLICATION WAS CORRECT AND COMPLETE WHEN THIS AGREEMENT WAS SIGNED. THIS AGREEMENT IS NOT BINDING UPON US OR EFFECTIVE UNTIL AND UNLESS WE EXECUTE THIS AGREEMENT. THE AGREEMENT WILL BE GOVERNED BY THE LAWS OF THE STATE OF WISCONSIN. YOU AGREE TO THE JURISDICTION AND VENUE OF FEDERAL AND STATE COURTS IN WAUKESHA COUNTY, WISCONSIN. ACCEPTED BY: PROPOSED BY: OWNER: CAMADON, INC. USER: THE LAND SALES RESOURCE BY: /s/ ILLEGIBLE BY: /s/ ILLEGIBLE -------------------------------- -------------------------------- TITLE: LEASE Coordinator TITLE: ------------------------------ ------------------------------ DATE: 6-20-94 DATE: ------------------------------ ------------------------------ - ------------------------------------------------------------------------------ UNCONDITIONAL PERSONAL GUARANTY: TO CAMADON, INC. In consideration of your entering into the above Agreement in reliance upon this guaranty, the undersigned, together and separately, unconditionally and irrevocably guaranteed to you, your successors and assigns, the prompt payment and performance of all obligations under the Agreement. We agree that (a) this is a guaranty of payment and not of collection, and that you can proceed directly against us without disposing of any security or seeking to collect from the above named User, (b) we waive all defenses and notices, including those of protest, presentment and demand, (c) you may extend or otherwise change the terms of the Agreement without notice to us, and (d) we will pay all of your costs of enforcement and collection. This guaranty survives the bankruptcy of the above named User and binds our administrators, successors and assigns. My obligations under this guaranty continues even if the User becomes insolvent or bankrupt or is discharged from bankruptcy and I agree not to seek to be repaid by the User in the event I must pay you. THIS GUARANTY WILL BE GOVERNED BY THE SAME STATE LAW AS THE AGREEMENT. WE AGREE TO JURISDICTION AND VENUE IN THE STATE AND FEDERAL COURTS IN THE SAME STATE AND COUNTY. By___________________ , individually By___________________ , individually Address_____________________________ Address_____________________________ Soc. Security #_____________________ Soc. Security #_____________________ Witness:____________________________ Witness:____________________________ ================================================================================ 2. ORDERING EQUIPMENT. You request us to arrange delivery of the equipment to you at your expense. If the Equipment has not been delivered, implied, and accepted by you, within forty-five (45) days from the date that ordered the equipment, we may terminate the Agreement and our obligations to you on ten (10) days written notice to you. If we have issued a purchase contract or order for the Equipment, you agree that the purchase order or contract is acceptable to you. If you have entered into a purchase contract for the Equipment, by signing this Agreement you have assigned it to us, effective when we pay for the Equipment. 3. COPY CHARGES. The first monthly payment is due upon receipt of invoice. Thereafter, monthly payments will be due on the same date each month during the Initial Term, which will start on the date you accept the Equipment (as confirmed by a properly executed Certificate of Acceptance received by us or as otherwise confirmed by us to our satisfaction) and will continue until the end of the Term, whether or not you receive an invoice, payments will be made to us at our address below, or at another address which we designate in writing. Your obligation to pay Minimum Monthly Copy Charges is unconditional and is not subject to any reduction, set-off, defense, or counterclaim for any reason whatsoever. If we accepted an advance payment form you, it will be held by us to secure your faithful performance of this Agreement, and it will be returned or applied as stated in Paragraph 12. You agree that we may at our option charge and collect a one-time reasonable administrative fee for credit investigation and documentation expenses. 4. NO WARRANTIES. The Equipment is being supplied to you "AS IS". YOU AGREE THAT YOU HAVE SELECTED THE SIZE, MODEL, DESIGN AND BRAND OF THE EQUIPMENT USING YOUR OWN JUDGMENT WITHOUT ANY RELIANCE ON US. WE MAKE NO WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE OR ORDINARY USE IN CONNECTION WITH THIS AGREEMENT OR THE EQUIPMENT. As long as you are not in default under any of the terms of this Agreement, we transfer to you any warranties made to us by the manufacturer or supplier. YOU AGREE THAT REGARDLESS OF CAUSE, YOU WILL NOT MAKE ANY CLAIM WHATSOEVER AGAINST US OR ANYONE TO WHOM WE MAY ASSIGN THIS AGREEMENT FOR LOSS OF EXPECTED PROFITS OR ANY OTHER DIRECT, SPECIAL OR INDIRECT DAMAGES. You acknowledge that anyone to whom we assign this Agreement will not be responsible for any service, repairs or maintenance of the Equipment, that such assignee is not a party to any service or maintenance agreement, and even if you have a dispute regarding the Equipment, you will continue to pay such assignee all rental and maintenance payments due under this Agreement and all schedules to this Agreement without deducting or withholding any amounts. 5. METER. (A) In return for Minimum Monthly Copy Charge, you are entitled to use the Agreed Minimum Number of Copies each month. If you use more than the Agreed Minimum Number of Copies in any month, you will additionally pay us a charge equal to the number of additional metered copies times the Excess Copy Charge. We may audit the automatic meter reading device periodically. If we determine that you have used fifteen percent (15%) more supplies than normal for copies, you agree to pay customary charges for all excess supplies. (B) The Meter Reading Frequency is the period of time (monthly, quarterly, semi annually or annually) for which the number of copies used will be reconciled. The Meter Reading Frequency and corresponding excess charge, if any, may be different than the Minimum Payment Frequency. (C) You agree to provide adequate space without charge at the Equipment Location for the Equipment, adequate electricity (including if necessary a dedicated 220 volt line), a telephone line and hookup for any automatic meter reading device and reasonable storage for supplies to be used with the Equipment. Most Equipment will be connected to an automatic meter reading device which will report the number of copies made on the Equipment each month and upon which monthly invoices will be based. If an automatic meter reading device is not installed and otherwise upon request, you shall provide us by telephone with the actual meter reading on the first business day of each calendar month, provided that we may estimate a number of copies used if such meter reading is not received by us within seven (7) days. We will adjust the estimated charge for excess copies upon receipt of actual meter readings. Notwithstanding any adjustment you will never pay less than the Minimum Monthly Copy Charge. 6. ASSIGNMENT. YOU MAY NOT SELL, TRANSFER, ASSIGN OR SUBLEASE THE EQUIPMENT. We may, without notifying you, sell, assign, or transfer this Agreement and ownership of the Equipment. You agree that if we do so, the new owner will have the same rights and benefits that we now have, and the assignee will not have to perform any of our obligations. You agree that the rights of the assignee will not be subject to any claims, defenses, or set-offs that you may have against us. However, any such assignment, sale or transfer of this Agreement or the Equipment will not relieve us of our obligations to you under this Agreement. 7. OWNERSHIP AND QUIET ENJOYMENT. We are the owner of the Equipment and have title to the Equipment. If any other person attempts to claim ownership of the Equipment against or through you, you agree, at your expense, to protect and defend our title to the Equipment. You agree that you will at all times keep the Equipment free from any legal process or lien whatsoever, and you will give us immediate notice if any legal process or lien is asserted or made against the Equipment. So long as you are not in default under any of the terms in this Agreement, we agree that you shall quietly use and enjoy the Equipment. YOU AGREE THAT YOU WILL NOT BE ABLE TO PURCHASE THE EQUIPMENT AT ANY TIME. 8. CARE, USE AND LOCATION; LOSS. (A) You will not move the Equipment form the Equipment Location without our written consent in advance. You will give us reasonable access to the Equipment Location to confirm the Equipment's existence, condition and proper maintenance. You are responsible for installing and keeping the Equipment in good working order and repair and for using it in compliance with all applicable laws. You will not make any alterations to the Equipment without our prior written consent nor will you permanently attach the Equipment to your real estate. At the end of the Initial Term of the Agreement, you will return the Equipment to us, at your expense. (B) You are responsible for protecting the Equipment from damage, except for ordinary wear and tear and from any other kind of loss while you have the Equipment or while it is being delivered to you. Even if the Equipment is damaged or lost, you agree to pay all Minimum Monthly Copy Charges for the entire Initial Term. 9. TAXES. You agree to pay when due either directly or to reimburse us all taxes, fines and penalties relating to this Agreement or the Equipment. 10. INDEMNITY. We are not responsible for any injuries, damages, penalties, claims or losses including legal expenses incurred by you or any other person caused by the installation, selection, ownership, possession, maintenance, condition or use of the Equipment. You agree to reimburse us for and to defend us against any claims for such losses, damages, penalties, claims, injuries or expenses. This indemnity shall continue even after this Agreement has expired. 11. INSURANCE. You agree to keep the Equipment fully insured against loss until you have met all your obligations under this Agreement. You agree to obtain a general public liability insurance policy, covering both personal injury and property damage, from anyone who is acceptable to us and include us as an insured on the policy. You agree to provide us with certificates or other evidence of insurance acceptable to us. If any insurance proceeds are paid as a result of any loss or damage to the Equipment, you agree that such insurance proceeds shall be paid first to us to satisfy your obligations under this Agreement. If the Equipment is either lost or totally destroyed, and you are not in default under the terms of this Agreement, instead of continuing to pay us the Minimum Monthly Copy Charge, you have the option of paying us the then present value of both the unpaid balance of all remaining Minimum Monthly Copy Charges under this Agreement and the value of our residual interest in the Equipment, each computed with a discount rate of six percent (6%) per year; or the lowest legal rate. If you do not provide evidence of proper insurance within ten (10) days of our request, we will have the right but not the duty to obtain such insurance at your expense on our own interest in the Equipment. You shall pay all premiums and related charges, including interest at up to one and one-half percent (1.5%) per month, or the highest legal rate, if less. 12. DEFAULTS AND REMEDIES. If you do not pay the Minimum Monthly Copy Charges when due or if you or your guarantor break any of your promises under this Agreement, or you or your guarantor become insolvent, assign your assets for the benefit of your creditors, or enter (voluntarily or involuntarily) into a bankruptcy proceeding, or all or a material portion of your assets or stock is sold, or (if an individual) you or your guarantor dies, or you are in default in any other agreement between you and us, you will be in default. If you are in default, we can require that you return the Equipment to us and pay to us the then present value of the unpaid balance of all remaining Minimum Monthly Copy Charges under this Agreement computed with a discount rate of six percent (6%) per year, or the lowest legal rate. If you fail to return the Equipment to us, in addition we can also require that you pay to us the current estimated fair market value of similar equipment of like age. You also agree to pay us interest on all sums due us from the date of default until paid at the rate of one and one-half percent (1.5%) per month, but only to the extent permitted by law. In addition, we shall be entitled to recover from you all damages caused by any such default to the extent permitted by law. We can also use any of the remedies available to us under the Uniform Commercial Code ("UCC") or any other law. If we refer this Agreement to an attorney for enforcement or collection, you agree to pay our reasonable attorney's fees, which may be twenty percent (20%) of the total discounted unpaid Minimum Monthly Copy Charges for the remaining term of this Agreement. If we have to take possession of the Equipment, you agree to pay the cost of the repossession, storing, shipping, repairing and selling the Equipment. Although you agree that we are not obligated to do so, if we decide to sell the Equipment, and we are able to sell the Equipment for a price that exceeds the sum of (a) our cost of repossession and sale of the Equipment and (b) our estimated residual value of the Equipment, present value as calculated above, then we shall give you credit for the amount of such excess. You agree that we do not have to notify you that we are selling the Equipment or of the time, place or advertising of any sale, You also agree that we may telephone you at any reasonable time to enforce our rights. 13. OTHER RIGHTS. You Agree that any delay or failure to enforce our rights under this Agreement will not prevent us from enforcing any rights at a later time. The parties intend this document to be a rental agreement. However, you grant us a security interest in your interest in the Equipment in case it is found otherwise: You also give us the right to file immediately, at your expense, any UCC financing statements or related filings, as well as the right to sign your name to any such filings that we make. 14. RETURN OF EQUIPMENT. When this agreement expires or is otherwise terminated, you shall disconnect, properly package for transportation, and return the Equipment, freight prepaid to us, in good repair, condition and working order, normal wear and tear excepted, to the location we designate. If upon expiration or termination, you do not immediately return the Equipment, at our option (a) we will peacefully remove the Equipment and you agree to pay us an amount equal to two (2) Minimum Monthly Copy Charges or (b) the Equipment will continue to be held and rented by you for successive periods at the same Minimum Monthly Copy Charge, subject to your or our right to terminate this Agreement upon one (1) month written notice, provided that we retain the right, in our sole discretion, to limit the total number of such successive renewals to protect our rights as owner of the Equipment. If we agree at your request to allow you to terminate this Agreement before the end of the Initial Term, you agree to pay us a reasonable fee for such privilege. 15. LATE CHARGES. If any part of a payment is not made by you when due, you agree to pay us a late charge of the higher of $25 or ten percent (10%) of each such late payment, but not more than permitted by law. You agree to pay us the late charge not later than one (1) month following the date that the original Minimum Monthly Copy Charge was due. 16. MISCELLANEOUS. This is the entire Agreement between us regarding the Equipment. In the event you fail to comply with any part of this Agreement, we can, but we do not have to, take any action necessary to effect your compliance and you will pay the amount it costs us plus all of our expenses in causing your compliance at the time of the next due Minimum Monthly Copy Charge. If any notices are required under this Agreement, they may be given personally or mailed to the addresses in this Agreement by certified or registered mail, postage prepaid or by recognized overnight delivery service. This Agreement is for the benefit of and is binding upon you and your personal representatives, successors and assigns. You agree and consent that we may serve you by registered or certified mail, which shall be sufficient to obtain jurisdiction. YOU WAIVE TRIAL BY JURY IN ANY ACTION BETWEEN US. Both you and we intend this Agreement to be a valid and legal document, and agree that if any part is determined to be unenforceable, all other parts remain in full force and effect. You agree that we both intent that this Agreement comply with all applicable laws. If it is determined that any payment due under this Agreement results in an interest payment, and that interest is higher than allowed by law, then any excess interest will be applied to principal and interest will be at the highest legal rate. In no event will you pay or will we charge or receive any more interest than allowed by law. 17. UCC-ARTICLE 2A PROVISIONS. You acknowledge that Article 2A of the UCC may be applicable to this Agreement. Therefore, you agree to the following: (a) you acknowledge that we have given you the name of the supplier of the Equipment you are renting from us in this Agreement or on the attached schedule or in your purchase agreement. We hereby notify you that you may have rights under the supply contracts and that you may contact the supplier for a description of those rights or any warranties; and (b) you hereby waive any rights and remedies you are given by Sections 2A-508 through 2A-522 of the UCC, including the right to reject the Agreement and the Equipment; to cancel the Agreement; to revoke acceptance of the Equipment; to grant a security interest in the Equipment in your possession or control for any reason; to recover damages under such UCC 2A Sections for any breach of warranty. You will start any action against us within one year. We will not be liable to you for any failure to deliver or delay in delivering the Equipment or other loss or damage suffered by you in connection with this Agreement or the Equipment. Exhibit 2.2.1(1) BILL OF SALE The Land Sales Resource, an Illinois corporation ("Assignor"), for good and valuable consideration to it in hand paid, receipt of which is hereby acknowledged, hereby sells, assigns, transfers and conveys unto COMPS InfoSystems, Inc., a Delaware corporation ("Assignee"), its Successors and assigns, the following described property: 1. All property of every kind and description and wherever situated, tangible and intangible, owned by Assignor or to which Assignor has any right, title or interest on the date hereof as described in Section 1.1 and the exhibits referenced therein of the Asset Purchase Agreement dated July __, 1995. 2. Assignor hereby authorizes and grants its power of attorney to Assignee and appoints Assignee and the officers thereof as Assignor's attorney-in-fact to take any appropriate action in connection with any of said rights, claims, causes or action and property, in the name of Assignor or in its own or any other name but at its own expense, it being understood that this authorization and power of attorney are coupled with an interest and irrevocable. 3. Assignee shall have the right to have and to hold all of the rights, claims, causes of action, property, assets, business and goodwill transferred hereby as a going concern. 4. Assignor does hereby warrant, covenant and agree that it: (i) has good and marketable title to the properties and assets hereby sold, assigned, transferred, conveyed and delivered, subject to such liens and other encumbrances as are disclosed in the Asset Purchase Agreement or any schedules or exhibits thereto and except as otherwise provided in the Asset Purchase Agreement; and (ii) will warrant and defend the sale of said properties and assets against all and every person or persons whomsoever claiming or to claim against any or all of the same, subject to the terms and provisions of the Asset Purchase Agreement. 1 IN WITNESS WHEREOF, this Bill of Sale has been executed this _____ day of July, 1995. ASSIGNOR The Land Sales Resource By ----------------------------------------------- Kitty Layne, President ASSIGNEE COMPS InfoSystems, Inc. By ----------------------------------------------- Chris Crane, President 5487.1 2 Exhibit 2.2.1(2) ASSIGNMENT OF REAL PROPERTY LEASE FOR VALUABLE CONSIDERATION receipt of which is hereby acknowledged, the undersigned The Land Sales Resource, an Illinois corporation ("Assignor") hereby assigns all of its right, title and interest under that certain Lease dated ____________________, 199_, by and between Assignor, as Lessee, and ________________________________________, as Lessor, for the office space located at 622 Executive Drive, Willowbrook, Illinois 60521 (the "Lease") including all of the undersigned's right, title and interest in and to any prepaid rent or security deposit with respect to the Lease, and delegates all of its duties under the Lease, to COMPS InfoSystems, Inc., a Delaware corporation ("Assignee"). Dated this _____ day of ____________________, 1995. The Land Sales Resource By ----------------------------------------------- Kitty Layne, President ACCEPTANCE OF ASSIGNMENT Assignee hereby accepts the assignment, transfer and conveyance of Assignor's interest under the Lease and further assumes and agrees to make all payments which become due from, and to perform all covenants, conditions, responsibilities, duties, liabilities and obligations which are to be performed by Assignor pursuant to the Lease effective as of the Closing of the Asset Purchase Agreement. Dated this _____ day of ____________________, 1995. COMPS InfoSystems, Inc. By ----------------------------------------------- Chris Crane, President 1 Exhibit 2.2.1(2) CONSENT TO ASSIGNMENT The undersigned, _______________________________________, hereby consents to the assignment of Assignor's interest under the Lease to COMPS InfoSystems, Inc., a Delaware corporation. The undersigned does not hereby waive any of its rights under the Lease, and all of the terms, conditions, provisions and covenants of the Lease shall remain and continue in full force and effect. Dated this _____ day of ____________________, 1995. -------------------------------------------- 5485.1 2 Exhibit 2.2.1(3) ASSIGNMENT OF EQUIPMENT LEASE FOR VALUE CONSIDERATION receipt of which is hereby acknowledged, the undersigned The Land Sales Resource, an Illinois corporation ("Assignor") hereby assigns all of its rights, title and interest under that certain Equipment Lease dated ____________________, 199_, by and between Assignor, as Lessee, and ________________________ as Lessor, for the equipment described on Exhibit A thereto (the "Lease"), including all of Assignor's rights, title and interest in and to any prepaid rent or security deposit with respect to the Equipment Lease, and delegate all of its duties under the Equipment Lease, to COMPS InfoSystems, Inc., a Delaware corporation ("Assignee"). Dated this _____ day of ____________________, 1995. The Land Sales Resource By ----------------------------------------------- Kitty Layne, President ACCEPTANCE OF ASSIGNMENT Assignee hereby accepts the assignment, transfer and conveyance of Assignor's interest under the Equipment Lease and further assumes and agrees to make all payments which become due from, and to perform all covenants, conditions, responsibilities, duties, liabilities and obligations which are to be performed by assignor pursuant to the Equipment Lease effective as of the Closing of the Asset Purchase Agreement. Dated this _____ day of ____________________, 1995. COMPS InfoSystems, Inc. By ----------------------------------------------- Chris Crane, President 1 Exhibit 2.2.1(3) CONSENT TO ASSIGNMENT The undersigned, ________________________________________ hereby consents to the assignment of Assignor's interest under the Equipment Lease to COMPS InfoSystems, Inc. The undersigned does not hereby waive any of its rights under the Equipment Lease, and all of the terms conditions, provisions and covenants of the Equipment Lease shall remain and continue in full force and effect. Dated this _____ day of ____________________, 1995. ---------------------------------------- 5484.1 2 Exhibit 8 COVENANT NOT TO COMPETE This COVENANT NOT TO COMPETE ("Covenant") is made and effective on July 31, 1995 by and between COMPS InfoSystems, Inc., a Delaware corporation ("COMPS"), The Land Sales Resource, an Illinois corporation ("LSR"), and Kitty Layne ("Layne"). LSR and Layne are sometimes collectively referred to as "Covenantors. This Covenant is made with reference to the following facts: A. COMPS, Layne and LSR have entered into an Asset Purchase Agreement dated July 17, 1995 ("Agreement") providing for COMPS to acquire the assets of LSR. B. Layne is a shareholder of LSR. C. COMPS is unwilling to purchase the assets unless Covenantors agree to provide this Covenant. NOW, THEREFORE, in consideration of the premises and mutual covenants, representations and warranties contained herein, the parties agree as follows: 1. NON-COMPETITION. Except as an employee or consultant of COMPS, Covenantors agree that they will not at any time within the three (3) year period immediately following the date of this Covenant, directly or indirectly, in the counties in which LSR is presently doing business, whether or not for compensation, engage in, or have any interest in any person, firm, corporation, or business (whether as an employee, officer, director, agent, shareholder, security holder, creditor, partner, consultant, holder of any beneficial interest or otherwise) that engages in any activity which is the same as, similar to, or competitive with any activity now engaged in by COMPS as long as COMPS, or any transferee of all or substantially all of the assets of COMPS ("Transferee") shall engage in this or similar activity. 2. EMPLOYEES. Covenantors shall not, during the term of this Covenant, induce any employee of LSR to leave the employ of the LSR. 3. CONSIDERATION. This Covenant is made in consideration of and in connection with the sale of the assets and good will of LSR as described in the Agreement. 4. TERM. The term of this Covenant is to be three (3) years from the date hereof. 5. ASSIGNMENT. No rights under this Covenant shall be assignable nor duties delegable by either party, except that COMPS may assign and delegate any of its rights and duties hereunder to a Transferee. Nothing contained in this Covenant is intended to confer upon any person or entity, other than the parties hereto, their successors in interest and Transferees, any rights or remedies under or by reason of this Covenant unless expressly so stated to the contrary. 6. SUCCESSORS AND ASSIGNEES. All covenants, representations, warranties and agreements of the parties contained herein shall be binding upon and inure to the benefit of their respective heirs, executors, administrators, personal representatives, successors and Transferees. 7. UNENFORCEABILITY. It is the intention of the parties hereto that the provisions of this Covenant shall be enforced to the fullest extent permissible under all applicable laws and public policies, but that the unenforceability or the modification to conform with such laws or public policies of any provision hereof shall not render unenforceable or impair the remainder of the Covenant. Accordingly, if any provision shall be determined to be invalid or unenforceable either in whole or in part, this Covenant shall be deemed amended to delete or modify, as necessary, the invalid or unenforceable provisions to alter the balance of this Covenant in order to render the same valid and enforceable. 8. INJUNCTIVE RELIEF. Covenantors acknowledge that any breach of this Covenant will result in irreparable damage to COMPS for which COMPS will not have an adequate remedy of law. Shareholder further acknowledges that COMPS shall be entitled to injunctive relief hereunder and the parties hereby consent to an injunction in favor of COMPS enjoining any breach of any of the foregoing by any court of competent jurisdiction without prejudice to any other right or remedy to which COMPS may be entitled. 9. COUNTERPARTS. This Covenant may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same agreement. 10. ATTORNEYS' FEES. If an action is instituted to enforce any of the provisions of this Covenant, the prevailing party in such action shall be entitled to recover from the losing party its or his reasonable attorneys" fees and costs as set by the court. 11. WAIVER. The waiver by either party of a breach of any provision of this Covenant shall not operate or be construed as a waiver of any subsequent breach. COVENANTORS: COMPS InfoSystems, Inc. By: /s/ KITTY LAYNE By: /s/ CHRIS CRANE ------------------------------ -------------------------------- Kitty Layne Chris Crane, President The Land Sales Resource By: /s/ KITTY LAYNE ------------------------------ Kitty Layne, President AMENDMENT TO COVENANT NOT TO COMPETE This Amendment to Covenant Not to Compete (the "Covenant Not to Compete") dated as of July 31, 1995 by and among COMPS InfoSystems, Inc., a Delaware corporation ("COMPS"), Kitty Layne ("Layne") and Land Sales Resource, an Illinois corporation ("LSR") is entered into and effective as of the 31st day of March, 1996. WHEREAS, the COMPS and Layne are also parties to that certain Employment Agreement dated as of August 1, 1995 (the "Employment Agreement"); and WHEREAS, in exchange for the amendment of even date herewith of the Employment Agreement, and in recognition of the value of the business and assets (including without limitation goodwill) acquired by COMPS from LSR pursuant to that certain Asset Purchase Agreement dated July 17, 1995 by and among COMPS, LSR and Layne, and for other good and valuable consideration receipt of which is hereby acknowledged, COMPS and Employee desire to amend the Employment Agreement as set forth herein; NOW THEREFORE, the Covenant Not to Compete is hereby amended as follows: Sections 3 and 4 of the Covenant Not to Compete is hereby amended and restated in its entirety as follows: 3. CONSIDERATION. This Covenant is made in consideration of and in connection with (i) the sale of substantially all the assets and good will of LSR as described in the Agreement; and (ii) the payment to Layne by COMPS of the amounts and at the times set forth on Exhibit A hereto. 4. TERM. The term of this Covenant is to run from July 31, 1995 through the close of business June 30, 1999. Except as set forth herein, the Covenant Not to Compete remains unmodified and in full force and effect. IN WITNESS WHEREOF, the parties hereto execute this Amendment, effective as of the date first above written. COMPS InfoSystems, Inc. a Delaware corporation By: /s/ KITTY LAYNE By: /s/ DALE WALLIS --------------------------------- --------------------------------- Kitty Layne Its: Chief Financial Officer -------------------------------- EXHIBIT A Date Payment Due ---- ----------- March 31, 1996 $22,400 December 31, 1996 70,000 December 31, 1997 76,000 December 31, 1998 75,000 2 Schedule 1.1 Asset Purchase Agreement Between COMPS and LSR LIST OF ASSETS WITH ESTIMATED VALUES TO BE TRANSFERRED AT CLOSE Following is the list of assets to be transferred under The Asset Purchase Agreement and their estimated fair market values at the date of close. No other assets are to be transferred as part of this Agreement. Actual values of these assets will be determined by a balance sheet showing actual value of these assets at July 31,1995 to be prepared by Roche, Scholz, Roche, & Walsh, LTD. CPAS. Cash (to be transferred to new LSR-COMPS bank account) $ 3,000 Accounts receivable (to be evidenced by a detailed aged receivable list) 65,000 Prepaid Map Subscriptions 1,000 Security deposits 3,615 Property and equipment (detail fist attached) 8,265 ------ Total assets transferred $ 80,880 ====== SCHEDULE 1.1.1 ASSETS ------ The complete database of LSR's real estate information in print and electronic form (database format) . Print and computer formats, including the file used in conjunction with Q&A to provide data electronically to customers. Customer list, customer data and customer subscription agreements, including: . account profile - contact name at the company and payment status of each account, including amounts currently due and through what date the customer has paid. . subscriber profile - name of company/individual who subscribes, the type(s) of product delivered to customers currently and in the past, the subscription price and term, and the format in which the subscriber receives the print and/or electronic data. . list of customers who have used LSR's call-in service and the level of sales to such customers in the last 12 months. All customer information shall include company name, address, phone number and company contact name. Schedule 1.1.6 Furnit.ofc OFFICE FURNITURE INVENTORY -------------------------- ITEM QTY ---- --- Desks 17 Tables 13 Credenzas 2 Bookcases 4 (large & small) Printer Stands 2 File Cabinets 18 (large & small) Chairs 35 1 OFFICE EQUIPMENT INVENTORY -------------------------- ITEM QTY ---- --- Fax machines 3 Copiers 2 Typewriters 1 Microfilm Readers 9 Merlin Telephones 13 computers: file server: DTK 486DX/50 EISA, 32Mb ram, 2.7Gb disk, 20 user NW3.11 fax server: 386SX/16, 4Mb ram, 2 Intel Satisfaxtion 400 int fax boards print srvr: Printmate dedicated 2P/1S ethernet MF: Midwest Micro 486DX2/66, 15" SVGA, 40OMb disk, 2x CD player, HP IIc scanner, Mirror/Syquest 20OMb 5 1/4" removable, USR Sportster 14.4 Fax/Modem, WangDAT 2Gb tape datafax: (2) Insight 486DX2/66 mono VGA reception: AGI 386DX/20, 8Mb ram, 28OMb disk KL: Xinetron 386DX/25 diskless, mono VGA, 5Mb ram, USR Sportster 14.4 JS: Xinetron 386DX/25 diskless, mono VGA, 5Mb ram SJ: Wang 386DX/20 JL: Compudyne 386SX/16 JB: Compaq Deskpro 286/12 research1: Insight 486DX2/66, 2x CD, mono VGA, USR Sportster 14.4 research2: Krista 486DX2/66, 2x CD, mono VGA print srvr: XT Turbo clone running IQ Server digest: Insight 486DX2/66, 15" SVGA, 40OMb disk, 2x CD player print srvr: AGI 286/12 running IQ Server *GK: Midwest Micro 486DLC/33 laptop, mono, 12OMb disk, modem *WH: Midwest Micro 486DX4/100, 15" SVGA, 54OMb disk, 2x CD, 14.4 F/M *JS: Clone XT Turbo * Machine is at employee's home. printers: HP LaserJet Series II HP LaserJet III HP LaserJet 4 MP PS, 6Mb ram HP DeskJet 1200c, 4Mb ram Fargo Primera 203dpi thermal wax/dye sub Oki ML393 24pin, wide carriage dot matrix Epson LQ850 24pin dot matrix (2) Panasonic KXP1180 9pin dot matrix UPS: (5) Tripp BC250 (1) Tripp BC400 (1) Tripp BC45OLan (1) Tripp BC75OLan (3) APC 250VA (1) APC 400VA SCHEDULE 1.2 ASSET PURCHASE AGREEMENT BETWEEN COMPS AND LSR LIST OF LIABILITIES TO BE ASSUMED BY COMPS AT CLOSE Following is the complete list of liabilities to be assumed by COWS under The Asset Purchase Agreement and their estimated fair market values at the date of close. No other liabilities are to be assumed as part of this Agreement. Actual values of these liabilities will be determined by a balance sheet showing actual value of these assets at July 31,1995 to be prepared by Roche, Scholz, Roche, & Walsh, LTD. CPAS. Accounts payable (to be evidenced by a detailed list of payables) $ 30,370 Payable to LSR for accrued payroll from July 22 through July 31 6,000 Line of credit to Bank 30,000 -------- Total liabilities to be paid in cash 66,370 Deferred subscription revenues 180,000 -------- Total liabilities transferred $246,370 ======== SCHEDULE 1.4 COMIPS INFOSYSTEMS, INC. THE LAND SALES RESOURCE, INC. ALLOCATION OF ASSET PURCHASE PIICE Assets purchased: Assets from Schedule 1.1 Cash $ 3,000 Accounts receivable 65,000 Prepaid Map Subscriptions 1,000 Security Deposits 3,615 Property and equipment 8,265 Value assigned to intangible asset purchased Customer lists 440,490 -------- Total value of assets purchased $521,370 ======== Purchase price: Liabilities assumed from Schedule 1.2 Accounts payable $ 30,370 Payable to LSR for accrued payroll 6,000 Line of credit to bank 30,000 Deferred subscription revenues 180,000 Cash paid at purchase 275,000 -------- Total purchase price $521,370 ======== NOTE: The above allocation of purchase price is based on the assumed asset and liability values to be transferred as set forth in Schedules 1.1 and 1. 2. After closing, Land Sales Resource will provide COMPS with a final July 31, 1995 balance sheet. The values set forth above will be adjusted to reflect the values on that balance sheet. After the final adjustments are made, IRS Form 8594 reflecting allocation values under Internal Revenue Code Section 1060 will be prepared by COMPS and provided to LSR. EX-10.43 46 PURCHASE AGMT EXHIBIT 10.43 PURCHASE AGREEMENT (this "Agreement") Dated: August 31, 1995 (the "Effective Date") Between COMPS INFOSYSTEMS, INC. -And- TRW REDI PROPERTY DATA, a Delaware corporation an Ohio general ("COMPS") And-partnership ("TRW REDI") Recitals - -------- 1. TRW REDI is engaged in the creation, marketing and sale of proprietary information products and services originating from real property ownership and sales information generated from public record sources and, in connection therewith, creates and maintains computerized files, residential, commercial and industrial real estate data, and other business information that is proprietary to TRW REDI, including without limitation original works of authorship in the compilation of otherwise unprotectable data; 2. COMPS is a company engaged in the creation, marketing and sale of proprietary information products and services derived from public record and private and other sources and, in connection therewith, COMPS creates and maintains computerized files, commercial and industrial real estate data, and other business information that is proprietary to COMPS, including without limitation Original works of authorship in the compilation of otherwise unprotectable data; 3. The parties desire that TRW REDI sell to COMPS and COMPS purchase from TRW REDI, the TRW REDI investment property publishing business described herein; 4. The parties desire that COMPS grant to TRW REDI certain license rights with respect to COMPS Data (as defined herein); and 5. The parties further desire to make certain agreements concerning the provision of public record information, all as provided herein. NOW THEREFORE, in consideration of the mutual premises and other good and valuable consideration had and received, TRW REDI and COMPS hereby agree as follows: 1. Definitions: The following terms will have the meanings specified below ----------- when used in this Agreement. 1.1 Accounts Receivable. Those accounts described in Section 2.2.2. ------------------- 1.2 Assets: Defined in Section 2.2. ------ *** Certain confidential portions of this Exhibit were omitted by means of blackout of the text (the "Mark"). This Exhibit has been filed separately with the Secretary of the Commission without the Mark pursuant to the Company's Application Requesting Confidential Treatment under Rule 406 under the Act. 1.3 California C&I Business: TRW REDI's C&I Photo Illustrated ----------------------- Business (as hereinafter defined) relating to Investment Property located within the state of California 1.4 C&I Data Extract Business: TRW REDI's Investment Property (as ------------------------- hereinafter defined) data extract publishing business as is more particularly described on Exhibit A. --------- 1.5 C&I Data Photo Illustrated: TRW REDI's Investment Property (as -------------------------- hereinafter defined) photo illustrated publishing business with respect to Investment Property as is more particularly described on Exhibit A. --------- 1.6 Closing: Defined in Section 12. ------- 1.7 COMPS Data: The product currently marketed and sold by COMPS ---------- with respect only to California Investment Property under the trademark "COMPS," as well as any successor product with substantially similar primary purpose, publishing substantially similar data, and addressing a substantially identical market, and published by COMPS after July 15, 1995. For purposes of this definition, the "primary purpose" of the COMPS Data product is the publication of current sales transaction data concerning the most recent sales (typically sales closing within the three-month period preceding publication of such COMPS Product) involving Investment Property located in California. COMPS Data does not include any product marketed or sold by COMPS which contains substantially different data or addresses a substantially different market than the current "COMPS" product, or the primary purpose of which is not the publication of current sales transaction data concerning the most recent sales involving Investment Property located in California. 1.8 COMPS Data Commission Fees: Defined in Section 3.3. -------------------------- 1.9 COMPS Mark: COMPS(R) ---------- 1.10 Confidential Information: Defined in Section 8. ------------------------ 1.11 Data Credit. Defined in Section 2.5. ----------- 1.12 Effective Date: Defined on page 1 of this Agreement. -------------- 1.13 Enhanced C&I Product: Property and transaction information -------------------- concerning Investment Property which includes public records data enhanced by additional information such as a photograph or photographs of the Investment Property, confirmed sales information (which may include but not be limited to income information, broker names and addresses, telephone numbers, buyer and seller names and telephone numbers, and contact names and telephone numbers for such parties), property condition, sale price, financing information, market time information, parking space information, cap rate or gross rent multipliers, and technical and non-technical property descriptions. 1.14 Florida and Georgia C&I Data Extract Business: TRW REDI's C&I ---------------------------------------------- Data Extract Business relating to Investment Property within the states of Florida and Georgia. 2 1.15 Gross Revenues: The monetary amount of all consideration -------------- collected by or for the benefit of COMPS from the sale, license, sublicense or other transfer, or use of COMPS Data, where such sale, license, sublicense or other transfer is made through the on-line digital transmission of such data in connection with the Sales Agency. 1.16 Initial Term: Defined in Section 13.2. ------------ 1.17 Investment Property: Real estate property, excluding "single ------------------- family residences," of a commercial nature which is used for investment purposes or is commonly referred to in the commercial real estate industry as "investment property." 1.18 Licensed Data: COMPS Data and/or TRW REDI Data, as applicable. ------------- 1.19 New York Territory: The five boroughs of New York City: ------------------ Manhattan, Brooklyn, Bronx, Queens, Staten Island. 1.20 Option Closing: Defined in Section 2.6.1. -------------- 1.21 Photo Illustrated Counties. The following counties located -------------------------- within the State of California: Contra Costa, San Diego, Alameda, Marin, Orange, San Francisco, Los Angeles, Riverside, San Bernardino, Santa Clara, San Mateo and Ventura. 1.22 Public Record Data Products: Data products derived solely from --------------------------- public record sources that are not enhanced by either additional value-added research data or other information obtained from non-public record sources. 1.23 Purchased Businesses. The California C&I Business, the C&I Data -------------------- Extract Business in the Territory (as defined below), and, following exercise by COMPS of the option set forth in Section 2.6, the Florida and Georgia C&I Data Extract Business. 1.24 Renewal Term: Defined in Section 13.2. ------------ 1.25 OuickSource: A call-in service of TRW REDI whereby customers ----------- may purchase comparable properties information. 1.26 Sales Agency: Defined in Section 3.1. ------------ 1.27 Term: The Initial Term and any Renewal Term. ---- 1.28 Territory: Collectively, the states of California and --------- Washington; the District of Columbia; Cook County, Illinois; Anne Arundel, Baltimore; Montgomery, and Price George's counties, Maryland; and Arlington, Alexandria, Fairfax, Loudon and Prince William Counties, Virginia. 1.29 TRW REDI List Price: The TRW REDI Data list prices set forth in ------------------- Exhibit B. - --------- 3 1.30 TRW REDI Data: The transaction information and updates, ------------- assessor's data and maps compiled by TRW REDI from public record and other sources and distributed through published reports, magnetic tape or other magnetic media, microfiche products, and/or electronically via TRW REDI's on- line property database and CD-ROM systems or other media. 2. Sale and Transfer of TRW REDI Businesses. ---------------------------------------- 2.1 Business Sale and Transfer. At the Closing, and subject to the -------------------------- terms and conditions of this Agreement, TRW REDI agrees to sell, assign, transfer and convey to COMPS, and COMPS agrees to purchase and acquire from TRW REDI, all of TRW REDI's right, title and interest in and to all of the Assets (defined below). The Assets will be sold, assigned, transferred and conveyed to COMPS upon the Closing, free and clear of all mortgages, pledges, liens, licenses, rights of possession, security interests, restrictions, encumbrances, charges, title retention, conditional sale or other security arrangements and all claims or agreements of any nature whatsoever (except for licenses and other agreements assigned to COMPS pursuant to the terms of this Agreement, all of which are identified on Exhibit E). 2.1.1 Assignment of TRW REDI Contracts; Fulfillment of TRW REDI --------------------------------------------------------- Obligations. TRW REDI will assign to COMPS and COMPS agrees to fulfill and - ----------- assume, subject to Section 2.3 hereof, those agreements set forth in Exhibit E. --------- COMPS agrees to fulfill, as an independent sub-contractor to TRW REDI and at no additional cost to TRW REDI except as set forth in this subsection, those agreements between TRW REDI and the customers of the Purchased Businesses whose agreements have not been assigned to COMPS hereunder and who have not yet entered into new contracts for similar products directly with COMPS, and who request continued service and products from TRW REDI under contracts with TRW REDI that exist as of the Closing. Such contracts may not be modified or extended by TRW REDI without the express written consent of COMPS. TRW REDI shall pass through to COMPS, on a monthly basis, all amounts collected by TRW REDI pursuant to such contracts. COMPS agrees to defend, indemnify and hold TRW REDI harmless against any and all loss, cost, claims, and liabilities directly arising from COMPS's performance of its obligations under this Section 2.1.1 and based upon facts, circumstances or events occurring following the Closing. Any party seeking indemnification under this Section 2.1.1 shall provide prompt notice of any claim or occurrence potentially giving rise to indemnification obligations hereunder, and shall permit the indemnifying party to assume and control the defense thereof. Neither party shall be responsible for any settlement made with respect to any claim for which indemnification sought hereunder without the other's prior written consent, which shall not unreasonably be withheld. 2.2 Assets Defined. As used in this Agreement, the term "Assets" -------------- means, collectively, all of the assets, rights and properties of TRW REDI described in the following paragraphs of this Section 2.2: 2.2.1 Customer Lists, Marketing Information. All of TRW REDI's lists ------------------------------------- of current customers of the Purchased Businesses, together with such additional data regarding such customers and prior customers of the Purchased Businesses (such as historical, marketing, promotional and sales information used by TRW REDI in the Purchased Businesses) which can be assembled and provided by TRW REDI following a reasonable effort. 4 2.2.2 Accounts Receivable. Subject to the limitations in this -------------------- section, the accounts receivable of the Purchased Businesses existing as of the Closing, together with all rights, claims, and causes of action of TRW REDI relating thereto. A complete schedule of Accounts Receivable as of the date of this Agreement is attached hereto as Exhibit F. An updated schedule shall be --------- provided by TRW REDI at the Closing and attached as Exhibit F-1 hereto and made ----------- part hereof. TRW REDI warrants and confirms that all of the receivables purchased by COMPS and identified on Exhibit F and Exhibit F-1 represent goods --------- ----------- shipped by TRW REDI and received by the customer. TRW REDI shall pass through to COMPS on a monthly basis, any and all amounts collected by TRW REDI after the Closing pursuant to these receivables. COMPS shall be liable for all taxes on any such amount passed through to COMPS. 2.2.3 Employee List. A complete list of the TRW REDI employees ------------- engaged in the Purchased Businesses as of the Closing, including full name, position, duration of employment and salary information, together with, with respect to those TRW REDI employees who consent, all personnel records relating to any of such consenting TRW employees. 2.2.4 Business Records. All books, records, files, and sales ---------------- literature and sales aids, pictures, product sheets and documentation, product displays, advertising materials, and manuals relating to the Purchased Businesses, an electronic version of the TRW REDI C&I database for the three- year period preceding the Effective Data with respect to the Purchased Businesses, and all copies of TRW REDI C&I Photo Illustrated Books relating to the California C&I Business in TRW REDI's possession. 2.3 Liabilities Not Assumed. Except as specifically set forth in ----------------------- Sections 2.1.1 and 2.3, TRW REDI does not transfer hereunder, and COMPS does not assume hereby, any liability associated with the Purchased Businesses. TRW REDI agrees to defend, indemnify and hold COMPS harmless against any and all loss, cost, claims, and liabilities not expressly assumed by COMPS hereunder, including but not limited to any liabilities arising under any contracts relating to the Purchased Businesses, and based upon facts, circumstances or events occurring prior to the Closing. Without limiting the generality of the foregoing, TRW REDI shall be solely responsible for any refunds and/or cancellation fees it becomes obligated to pay as a result of the transactions contemplated by this Agreement. 2.4 Conversion of TRW REDI Subscribers; Referrals to COMPS. For such ------------------------------------------------------ of TRW REDI's California C&I Business and C&I Data Extract Business contracts (if any) that may not be sold, transferred or assigned by TRW REDI without Subscriber consent, TRW REDI agrees to reasonably cooperate with COMPS's efforts to induce TRW REDI customers for the California C&I Business and C&I Data Extract Business to substitute COMPS subscriber agreements for TRW REDI subscriber agreements. In addition, TRW REDI QuickSource will refer all inquiries it receives during the Term regarding Investment Property located within the Territory (and, following exercise by COMPS of the option described in Section 2.6, located within the United States except the New York Territory), to COMPS. 2.5 Purchase Price and Payment Terms. In consideration for sale and -------------------------------- transfer to COMPS of the Assets, and other consideration as provided herein, COMPS agrees to pay TRW REDI, the following amounts upon the dates set forth below: 5 Date Amount ---- ------ Closing $*** 12/l/96 *** 12/l/97 *** 12/l/98 *** 12/l/99 *** 12/l/00 *** 12/l/01 *** In addition to the foregoing payments, COMPS shall pay TRW REDI for the purchased accounts receivable as described in Section 2.2.2 and as listed in Exhibit F-1 as follows. COMPS shall pay only for receivables balances that represent billings for goods that have been shipped and have been received by the customer. For all accounts having any balances greater than 120 days old, COMPS shall pay 30% of the total receivable balance for such accounts. For accounts with no balances over 120 days old, COMPS shall pay 80% of the total receivable balance. At the close, COMPS shall pay TRW REDI $25,000 towards payment for accounts receivable. Within 10 business days of COMPS being provided information regarding the receivables in a format that allows COMPS to bill and collect the receivables, a final accounting shall be made of the amounts due under this section and payment shall be made by COMPS to TRW REDI for any balance remaining due or payment shall be made by TRW REDI to COMPS for any overpayment. COMPS shall receive a "Data Credit" towards the purchase of TRW REDI Data described in Section 2.8 in the amounts of $100,000 for each of the next five (5) twelve-month periods beginning upon the Closing. Such Data Credit shall be based upon the price for such TRW REDI Data described in subsection 2.8.2 (inclusive of the discount described therein). COMPS purchase of TRW REDI Data shall be pursuant to a standard TRW REDI subscription agreement, a form of which is attached hereto as Exhibit G. Notwithstanding anything in such standard --------- TRW REDI subscription agreement however, COMPS shall be entitled to the licensed use of TRW REDI Data described in Section 4 hereof. The payment obligations set forth above shall be evidenced by a promissory note in the form attached hereto as Exhibit H. --------- In the event TRW REDI discontinues the generation of TRW REDI Data pursuant to Section 5.3 ("Discontinuation") hereof in a number of counties resulting in a decrease in the number of counties covered by TRW REDI to fewer than 145, then COMPS shall be entitled to reduce the amounts payable pursuant to this Section as follows: (i) in the event COMPS uses the entire Data Credit in a given twelve-month period, there shall be no reduction in the amounts payable pursuant to this section; (ii) in the event COMPS uses less than the entire Data Credit in any given twelve-month period, COMPS may offset the amounts payable pursuant to this Section for the following twelve-month period by an amount equal to the difference between the Data Credit and the amount of the Data Credit actually used by COMPS. For example, if TRW REDI reduces the number of counties to less than 145 during the 1996 calendar year, and COMPS uses $80,000 of the Data Credit during such period, then COMPS is entitled to reduce the amount payable on December 1, 1996 by $20,000 (note: if the number of covered counties falls below 145 subsequent to December 1 of a given calendar year, COMPS shall be entitled to offset the amount payable with respect to the following year). 6 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 2.5.1 Failure to Make Payments. In the event COMPS fails to make any ------------------------ of the payments described in this Section 2.5, within 10 business days of notice of such failure, and in addition to all other legal, equitable and contractual remedies, TRW REDI may elect any or all of the following: (i) TRW REDI may, at its option, elect to accelerate all remaining payments due under this Section 2.5, so that such payments become immediately due and payable; (ii) TRW REDI may offset against all amounts due TRW REDI from COMPS pursuant to this Section 2.5 any amounts payable to COMPS pursuant to Section 3.4.1 ("Report and Payment") until such time as COMPS's obligations under this Section 2.5 have been satisfied; (iii) TRW REDI shall have, only during the period as to which COMPS has not satisfied its obligations under this Section 2.5, a fully-paid royalty- free license to re-sell in digital form the COMPS Data (such license to expire upon payment by COMPS of all amounts currently due under this Section 2.5 or upon receipt by TRW REDI pursuant to the exercise of such license of proceeds equal to amounts currently due from COMPS less the COMPS Data Commission Fees otherwise payable by TRW REDI with respect to the sale of such COMPS Data); (iv) TRW REDI may suspend the Data Credit provided to COMPS in Section 2.5, above; and (v) COMPS shall be subject to the late payment charge described in Section 3.5. 2.6 C&I Data Extract Business; Option. At any time during the first --------------------------------- year of the Initial Term, COMPS may, by written notice to TRW REDI, exercise the option granted by this Section 2.6 to acquire, to the extent described in Section 2.1 through 2.4 hereof, the Florida and Georgia C&I Data Extract Business. If this option is exercised by COMPS, and in consideration of such acquisition, COMPS agrees to pay TRW REDI the additional sum of Sixteen Thousand Six Hundred Sixty-Six Dollars and Sixty-Seven Cents ($16,666.67) each month for the first year following exercise of the option, and the sum of Twelve Thousand Five Hundred ($12,500) each month for each of the next succeeding four (4) years. 2.6.1 Payment and Delivery. Exercise of the option described in this -------------------- section shall be evidenced by written notice from COMPS to TRW REDI. COMPS shall have sixty (60) days from the date of such notice to conduct a reasonable due diligence inquiry into the status and condition of the Florida and Georgia C&I Data Extract Business. Provided COMPS is satisfied in its sole discretion with the results of such due diligence investigation, and provided TRW REDI has transferred and delivered the material and information described in Section 2.2 with respect to the Florida and Georgia C&I Data Extract Business, COMPS shall so notify TRW REDI and shall become obligated to begin making the monthly payments described in this section and shall promptly transmit the first such payment to TRW REDI (the "Option Closing"). Payments will be made by COMPS to TRW REDI by wire transfer of immediately available funds or by certified check on or before the end of each month following exercise of the option. 2.7 Covenant Not to Compete. TRW REDI agrees that for a period of ----------------------- one (1) year following the Closing, neither TRW REDI nor any affiliate of TRW REDI will, directly or indirectly through interest in an affiliate, enter into or conduct or assist another to conduct the C&I Data Extract Business or C&I Photo Illustrated Business in each county within the Territory. Material breach of this covenant shall be deemed a material breach of this Agreement, and in addition to all other available legal, equitable and contractual remedies, TRW REDI agrees to promptly refund to COMPS all amounts paid previously by COMPS pursuant to Section 2.5 (in which case COMPS shall pay for all Data Credits actually used by COMPS during the Term). Following the exercise by COMPS of the option described in Section 2.6 7 hereof, and subject to the occurrence of the Option Closing, TRW REDI agrees that for a period of one (1) year following the Option Closing neither TRW REDI nor any affiliate of TRW REDI will, directly or indirectly through interest in an affiliate, enter into or conduct or assist another to conduct the C&I Data Extract Business or C&I Photo Illustrated Business in each county within North Carolina, South Carolina, Alabama, Mississippi, Florida, and Georgia. TRW REDI agrees to cure, within fifteen (15) days of COMPS's request therefor, all breaches of this Section regardless of materiality. 2.8 TRW REDI Data. -------------- 2.8.1 Sale of TRW REDI Data to COMPS: During the Term of this ------------------------------ Agreement, TRW REDI agrees to sell to COMPS such TRW REDI Data for the United States of America (except for the states of Florida, Georgia and the New York Territory) as COMPS may order from time to time. If COMPS exercises the option pursuant to Section 2.6 of this Agreement, TRW REDI further agrees to sell the TRW REDI Data for Florida and Georgia to COMPS on an as-ordered basis. 2.8.2 Price and Payment. For all TRW REDI Data orders, COMPS agrees ----------------- to pay TRW REDI the list prices set forth on Exhibit B (as modified by TRW REDI --------- from time to time), less a ten percent (10%) discount (or such greater discount - - including any discount resulting from reduction in TRW List Prices - made available to TRW REDI's most favored customer during the Term). 2.9 Non-Solicitation of Former TRW REDI Employees. TRW REDI agrees --------------------------------------------- that for the Term of this Agreement, neither TRW REDI nor any affiliate of TRW REDI will directly or indirectly solicit any former TRW REDI employees hired by COMPS to terminate their employment with COMPS. 3. COMPS Appointment of TRW REDI as Sales Agent. -------------------------------------------- 3.1 Sales Agency. Subject to the terms and conditions hereof, COMPS ------------ appoints TRW REDI as its non-exclusive sales agent for on-line digital transmission of COMPS Data stored in a computer database format (the "Sales Agency"). Such appointment shall be non-transferable by TRW REDI In connection with such appointment, COMPS hereby provides TRW REDI a non-exclusive, non- transferable license to digitally publish and transmit COMPS Data in the format of an on-line computer database and to offer to end users a non-transferable license from COMPS for the personal use of such COMPS Data by such end users for real estate appraisal and analysis. TRW REDI agrees that all sales of COMPS Data pursuant to the Sales Agency shall be on a "per inquiry" basis, according to the specifications in Exhibits C-1 or C-2, as applicable, and that such products shall not be sold, transferred or delivered in bulk. For purposes of this section, COMPS acknowledges that TRW REDI currently bases its on-line pricing for Commercial and Industrial Data on a per minute basis and shall remain as such until such time as COMPS provides TRW REDI with specifications reasonably acceptable to TRW REDI for changing this pricing method which changes shall be made upon 75 days notice to TRW REDI. If such change is requested, it shall not be treated as a change under Section 3.1.1. Failure by TRW REDI to complete the requested changes to COMPS's reasonable satisfaction 8 within such 75-day period shall result in a penalty of $1,000 per day to be subtracted from next payment to be made an the Promissory Note. 3.1.1 Obligations of TRW REDI. In correction with the Sales Agency, ----------------------- TRW REDI agrees (i) it shall publish COMPS Data as a stand-alone product and only in the format attached hereto as Exhibit C-2; (ii) it shall make COMPS Data ----------- available through its on-line database services to TRW REDI subscribers on a consistent basis; (iii) it shall provide a level of customer service to purchasers of COMPS Data consistent with the level of service provided by TRW REDI to subscribers to other TRW REDI on-line information services; (iv) TRW REDI will use its reasonable efforts to keep its on-line technology current with competitive on-line services; (v) TRW REDI shall offer and provide COMPS Data only at such prices and terms determined by COMPS and provided to TRW REDI (such prices and terms subject to change in the unilateral discretion of COMPS upon sixty (60) days notice to TRW REDI; such changes shall be limited to once-per- year unless COMPS pays TRW REDI for the time and materials cost of such changes; however, COMPS may make one other such additional change, subject to this Section 3.1.1, during the Term); and TRW REDI shall use reasonable care to notify its on-line subscribers that COMPS Data is owned by COMPS and subject to copyright and other intellectual property protection. As an inducement for TRW REDI to act as COMPS' agent and to open its system to COMPS' product, COMPS acknowledges that TRW REDI must obtain a commission sufficient to cover its costs of providing such product. Therefore, COMPS will not set a price for such product less than an amount sufficient to permit TRW REDI to recover such commission, which commission COMPS acknowledges as $0.12 per minute or $0.50 per inquiry. For purposes of this Section 3.1.1. price changes refers to the numerical values of such prices and not the pricing methodology. 3.1.1.1 non-exclusive Remedies. In case (A) COMPS Data is not ---------------------- available to end users through the Sales Agency for either (1) a period of thirty (30) consecutive days, or (2) a total of sixty (60) days during the Term, or (B) TRW REDI fails to comply with any other obligation set forth in this Section, and in addition to other equitable, legal and contractual remedies available, the Sales Agency shall terminate at COMPS's option. Notwithstanding the foregoing, the termination of the Sales Agency shall not occur until the completion of, in the case of a breach of the obligations described in this subsection or in clauses (i), (ii), (iii) or (v) of subsection 3.11, thirty (30) days from written notice of such failure, and, in the case of a breach of the obligation described in clause (iv) of subsection 3.1.1, six (6) months from the date of written notice of such failure. 3.1.2 Exclusive Agency. TRW REDI agrees that it shall not, during ---------------- the term of the Sales Agency, provide on-line services or availability with respect to any other Enhanced C&I Product. 3.2 Nonexclusive License Grants. ---------------------------- 3.2.1 COMPS Mark. Subject to Section 6, COMPS grants to TRW REDI a ---------- nonexclusive, nontransferable license to use the COMPS Mark in connection with marketing and performing its obligations under the Sales Agency. TRW REDI shall have no other rights to use the COMPS Mark except as expressly set forth herein. 9 3.2.2 Limitations. TRW REDI may not use or reproduce the COMPS Mark ----------- in any manner other than in the manner as set forth in Section 6 and such other manners as COMPS may pre-approve in writing. Upon any expiration or termination of the Sales Agency provided by this Section 3, the license grant pursuant to Section 3.2.1 shall immediately terminate and TRW REDI shall discontinue all use and distribution of COMPS Mark. 3.3 Fees Paid to TRW REDI. In consideration of its performance --------------------- under the Sales Agency, COMPS agrees to pay TRW REDI the following fees ("COMPS Data Commission Fees"): a. For aggregate COMPS Data sales through the Sales Agency during each succeeding twelve-month period beginning upon the Closing of up to *** Dollars ($***), *** percent (***%) of Gross Revenues collected by TRW REDI for the benefit of COMPS; and b. For aggregate COMPS Data sales through the Sales Agency during each succeeding twelve-month period beginning upon the Closing in excess of *** Dollars ($***), *** percent (***%) of Gross Revenues collected by TRW REDI for the benefit of COMPS. 3.4 Report and Payment of Proceeds. ------------------------------ 3.4.1 Report and Payment. Within thirty (30) days after the end of ------------------ each calendar month, TRW REDI will provide COMPS with a detailed and accurate statement, in a customary form reasonably satisfactory to COMPS, of the identity of purchasers of COMPS Data through TRW REDI's on-line services and the calculation of all COMPS Data Commission Fees earned by TRW REDI with respect to the immediately preceding month, together with payment of Gross Revenues during such month less the COMPS Data Commission Fees earned by TRW REDI during such month. Such payment shall be made by TRW REDI check. 3.4.2 Records and Audit Rights. TRW REDI shall maintain current, ------------------------ accurate and complete books and records relating to COMPS Data sales and all payments due hereunder in sufficient detail to enable the COMPS Data Commission Fees payable thereon to be determined. COMPS or its designee (which shall be a certified public accountant chosen by COMPS) may audit the records of TRW REDI as necessary, but no more than annually, to verify such fees, during normal business hours and following reasonable notice. If the audit discloses overpayment of such fees by COMPS, TRW REDI shall promptly pay to COMPS an amount equal to any such overpayment to which COMPS is entitled as disclosed by the audit, plus late charges thereon as set forth in Section 3.5. Alternatively, if the audit discloses underpayment of such fees, COMPS shall promptly remit to TRW REDI any such underpayment. Such audit shall be at COMPS's expense; provided, however, that if the audit discloses that COMPS overpaid COMPS Data Commission Fees by at least five percent (5%) for the audited period, then TRW REDI shall reimburse COMPS for the reasonable audit costs related to said overpayment. COMPS may exercise its right of audit as to each of TRW REDI and its permitted sublicensees no more frequently than once per year with respect to COMPS Data sales for the preceding three (3) calendar years (except that COMPS may perform one additional audit during the term if necessary or advisable in connection with a significant transaction or financing). TRW REDI shall preserve and maintain all such records required for audit for a period of three (3) years after the month to which the record applies. COMPS or its designee, may, during the course of such 10 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. examination, make such copies and/or extracts of TRW REDI's books and records relating to COMPS Data sales as are reasonably necessary. COMPS and its designee shall treat all such information reviewed during the audit as Confidential Information of TRW REDI. 3.5 Late-Charges. Any late payments under this Section 3 shall ------------ incur late charges at a rate equal to the lesser of one and one-half percent (1.5%) per month or the maximum legal rate. 4. Reservations. Except as expressly provided in this Agreement, each party ------------ reserves all proprietary rights in and to: (i) all of the underlying data, compilations and information gathered, compiled or published by such party in connection with the creation and preparation of the Licensed Data; (ii) all of the other data, compilations and publications created, prepared or authorized by each party not consisting of the Licensed Data; and (iii) all copyrights and other proprietary rights in any of the foregoing. However, notwithstanding anything in any TRW REDI subscription or other agreement to which COMPS may be subject, COMPS is expressly licensed and permitted to incorporate TRW REDI Data into its permanent enhanced Investment Property database; provided, however that ----------------- such incorporated information may not be transferred, re-sold, licensed or sub- licensed by COMPS "as is," and may only be transferred, re-sold, licensed or sub-licensed by COMPS as part of COMPS Data or another COMPS enhanced information product. Nothing herein shall be construed as a license by TRW REDI to COMPS relating to any TRW REDI or TRW tradenames or trademarks, including without limitation "'TRW," "TRW REDI," and "QuickSource." 5. Delivery of Licensed Data; Other Services and Taxes. --------------------------------------------------- 5.1 Delivery of COMPS Data. ----------------------- 5.1.1 Initial Fulfillment. COMPS will deliver to TRW REDI one true ------------------- and complete copy of the COMPS Data as of January 1, 1995 and updated through September 25, 1995, on or before September 30, 1995. 5.1.2 Updates. COMPS will deliver updates of the COMPS Data to TRW ------- REDI weekly. COMPS will use its best efforts to provide updates which are as current and complete as the most current of any of COMPS products available. 5.1.3 Shipping Address. COMPS will ship COMPS Data and an updates to ---------------- TRW REDI at the following address: 5601 East La Palma Avenue, Anaheim, California 92807, Attention: Diana Serio. 5.1.4 Format and Layout. COMPS will furnish the COMPS Data (i) on ----------------- magnetic media in IBM compatible format, and in the record layout set forth in Exhibit C-1, and (ii) in hard-copy form as currently made available by COMPS to - ----------- its customers. 5.1.5 During a transition period from the Closing until the time referenced in Section 5.1.1, COMPS shall immediately give COMPS Data to TRW REDI in hard copy. COMPS and TRW REDI shall work together to input such COMPS Data into TRW's database. The costs of such input shall be borne equally by COMPS and TRW REDI. 11 5.2 Delivery of TRW REDI Data. TRW REDI shall deliver to COMPS ------------------------- such TRW REDI Data as COMPS may order in accordance with the order and delivery instructions provided in written purchase orders that COMPS may place with TRW REDI from time to time. COMPS may request TRW REDI to deliver the TRW REDI Data in any standard form, media and/or format currently provided by TRW REDI to any of its customers. TRW REDI Data obtained under the Data Credit set forth in Section 2.5 above will be provided to COMPS in a custom form, media and/or format ONLY IF COMPS pays TRW REDI an additional fee including, without limit, all additional costs, fees or expenses of such custom work. TRW REDI agrees to negotiate with COMPS in good faith in the event COMPS makes a request for such custom work. 5.3 Discontinuation. Notwithstanding anything herein to the --------------- contrary, either party to this Agreement may discontinue compiling and providing the Licensed Data for any geographic location which prohibits the provision of such data in accordance with this Agreement, or for any geographic location where a party hereto voluntarily elects to discontinue the compilation of such data. 5.4 Services. TRW REDI agrees, for a period of three (3) months -------- after the Closing and promptly upon the request of COMPS, to provide reasonable training and access to TRW REDI personnel so as to enable COMPS to independently generate a list of sales transaction leads for the Territory. Such training shall not exceed one hundred (100) person-hours of time by TRW REDI personnel. 5.5 Taxes. Each party shall pay, respectively, all applicable taxes, ----- fees and assessments now or hereafter imposed by any governmental authority with respect to the Licensed Data products distributed by such party. 6. Trademarks and Quality Control. ------------------------------ 6.1 Approval of Use of COMPS Mark. TRW REDI shall submit all ----------------------------- proposed uses of COMPS Mark to COMPS for the express prior written approval of COMPS before any distribution or use thereof. Such approval may be granted or withheld as COMPS may reasonably determine. Failure by COMPS to disapprove in writing any such proposed use within fourteen (14) days from the date of submission by TRW REDI shall be deemed approval thereof. After samples have been approved pursuant to this Section, TRW REDI shall not depart therefrom without the prior written approval of COMPS. 7. Proprietary Rights. ------------------ 7.1 Acknowledgement Each party acknowledges the other's valuable --------------- rights in and to the Licensed Data compilations, including each party's copyrights and other proprietary rights therein. 7.2 Restriction on Copying, Disclosure and Use. Except as set forth ------------------------------------------ in this Agreement, without the other party's prior written consent, neither party will: a. disclose or transfer any portion of the Licensed Data acquired from the other party in any manner other than as expressly authorized in this Agreement; 12 b. provide or cause to be provided data including the Licensed Data to any third party unless such third party enters into a certification acknowledging that the third party will not use the Licensed Data except as permitted by this Agreement. c. make any copies of the Licensed Data owned by the other party in any form except for two (2) authorized back-up copies; or d. use the other's Licensed Data in connection with promotional offerings (i.e., providing services or product without charge). 7.3 Ownership. TRW REDI may use the COMPS Mark for the purposes of --------- this Agreement. TRW REDI acknowledges that COMPS is the sole and exclusive owner of the COMPS Mark. TRW REDI agrees that it will not do anything inconsistent with such ownership either during the term of the Agreement or afterwards. Specifically, TRW REDI shall use reasonable and good faith efforts to use the COMPS Mark in a manner that does not deviate from COMPS's rights in the COMPS Mark, and TRW REDI will take no action that will interfere with or diminish COMPS's rights in the COMPS Mark. TRW REDI shall use the COMPS Mark so that such trademarks are a separate and distinct impression from any other trademark that may be used or affixed to any TRW REDI Product. Except as permitted in this Agreement, TRW REDI agrees that it will not adopt or use the COMPS Mark as part or all of any corporate name, trade name, other trademark, service mark or certification mark, either alone or in combination with other words. TRW REDI shall not register, or cause any third party to register, the COMPS Mark. TRW REDI hereby acknowledges that the public recognition and positive perception of the value which is associated with the COMPS Mark enhances and exceeds the tangible value of the COMPS Mark ("Good Will") and that all rights in the COMPS Mark and Good Will arising therefrom belong exclusively to, and shall inure to the benefit of, COMPS. TRW REDI shall not adopt or register a confusingly similar mark or designation anywhere in the United States in connection with the sale or marketing of any Enhanced C&I Product. 8. Confidentiality. Except as expressly permitted by this Agreement, each --------------- party agrees that it will not use or disclose any "Confidential Information" of the other party. "Confidential Information" means any information which the other party marks "Confidential" or if not disclosed in writing, identifies as confidential at the time of disclosure and confirms thereafter in writing within thirty (30) days of such disclosure. Confidential Information does not include any information which was either in the public domain or already known to the recipient at the time of disclosure, independently developed by the recipient, disclosed to recipient by a third party without breach of an obligation of confidentiality or disclosed pursuant to a court order. 9. Warranties and Indemnification. ------------------------------- 9.1 Warranties. COMPS and TRW REDI each represents and warrants to ---------- the other that (i) it has the right, title and authority to enter into and perform this Agreement (including, in the case of TRW REDI, good and marketable title to the Assets); and (ii) its execution, delivery and performance of this Agreement will not conflict with the terms of any other agreement to which it is a party. COMPS and TRW REDI each further covenant not to enter into any agreement which will conflict with the terms of this Agreement. Neither party guarantees the accuracy or reliability of any Licensed Data. THIS WARRANTY IS THE ONLY 13 WARRANTY WITH RESPECT TO THE LICENSED DATA, AND SUCH WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR PARTICULAR PURPOSE. 9.2 Limitation of Liability. EXCEPT AS SET FORTH IN SECTION 9.3, ----------------------- UNDER NO CIRCUMSTANCES WILL EITHER PARTY HAVE ANY OBLIGATION OR LIABILITY TO THE OTHER PARTY FOR ANY CLAIM, INJURY OR DAMAGE RELATING TO, ARISING OUT OF, OR RESULTING FROM THE INACCURACY OF ANY LICENSED DATA. NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT, UNDER NO CIRCUMSTANCES WILL EITHER PARTY HAVE ANY OBLIGATION OR LIABILITY TO THE OTHER FOR ANY INCIDENTAL, SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES INCURRED BY THE OTHER PARTY, REGARDLESS OF HOW SUCH DAMAGES ARISE AND OF WHETHER OR NOT A PARTY WAS ADVISED SUCH DAMAGES MIGHT ARISE. 9.3 Other Parties; Indemnification. Each party will include ------------------------------ provisions consistent with those set forth in Sections 9.1 and 9.2 above, in any agreement pursuant to which the Licensed Data is provided to any third party. Each party to this Agreement will indemnify, defend and hold harmless the other party (the "Indemnified Party") hereto, its employees, agents and representatives, from and against any losses, claims, suits, costs and/or expenses, including attorney fees, arising out of or resulting from any claim by any third party to whom the Indemnifying Party has provided the Licensed Data and based exclusively on such Licensed Data, whether such data was provided prior to or during the Term of this Agreement. The Indemnified Party shall provide prompt notice to the Indemnifying Party of a claim potentially giving rise to obligations under this section, and the Indemnifying Party shall be permitted to assume and control the defense thereof. The Indemnifying Party shall not be liable for any settlement entered into without its prior written consent, which shall not unreasonably be withheld. 10. Conditions Precedent to TRW REDI's Performance. The obligation of TRW REDI ---------------------------------------------- to consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or before the Closing of all the conditions set out below in this Section 10. TRW REDI may waive in writing any or all of these conditions, in whole or in part, without prior notice; provided, however, that no such waiver of a condition shall constitute a waiver by TRW REDI of any of its other rights or remedies, at law or in equity, if COMPS shall be in default of any of the representations or covenants under this Agreement. 10.1 Accuracies of COMPS' Representations. Except as otherwise ------------------------------------ permitted by this Agreement, all representations by COMPS in this Agreement shall be true on and as of the Closing as though made at that time. 10.2 Performance by COMPS. COMPS shall have performed, satisfied, -------------------- and complied with all covenants, agreements, and conditions required by this Agreement to be performed or complied with by COMPS on or before the Closing. 14 10.3 President's Certificate as to Financial Condition. TRW REDI ------------------------------------------------- shall have received a certificate duly executed by the President of COMPS, stating that the audited balance sheet of COMPS as of December 31, 1994, and the unaudited balance sheet of COMPS as of May 31, 1995, each reflects net worth (total assets less total liabilities) of at least $700,000. Such certificate shall also state that each of the balance sheets referred to in this section were prepared in accordance with generally accepted accounting principles (subject, in the case of the May 31 balance sheet, to normal year-end adjustments and the absence of footnotes). 11. Conditions Precedent to COMPS' Performance. The obligation of COMPS to ------------------------------------------ consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or before the Closing of all the conditions set out below in this Section 11. COMPS may waive in writing any or all of these conditions, in whole or in part, without prior notice; provided, however, that no such waiver of a condition shall constitute a waiver by COMPS of any of its other rights or remedies, at law or in equity, if TRW REDI shall be in default of any of the representations or covenants under this Agreement. 11.1 Financial Statements. TRW REDI shall have provided COMPS with -------------------- financial statements certified by an authorized officer of TRW REDI confirming that TRW REDI's total 1994 channel revenues equaled or exceed the revenues set forth on Exhibit D. --------- 11.2 Due Diligence. COMPS shall have completed due diligence and be ------------- satisfied, in its sole discretion (i) that the transactions contemplated herein do not conflict with any material contract or commitment to which TRW REDI is a party, including without limitation the TRW REDI General Partnership Agreement; (ii) that the status and condition of the California C&I Business and the C&I Data Extract Business are substantially as has been represented by TRW REDI to COMPS; and (iii) as to the quality and quantity of the customer base for the California C&I Business and the C&I Data Extract Business. COMPS agrees that TRW REDI information obtained during the due diligence described in this section shall be subject to the Non-Disclosure Agreement attached hereto as Exhibit I. --------- 11.3 Transfer of Business. TRW REDI shall have transferred to COMPS -------------------- all of the Assets, and TRW REDI shall have executed a Bill of Sale and Assignment in form reasonably satisfactory to COMPS and its counsel relating to the Assets. 11.4 Accuracies of TRW REDI's Representations and Warranties. Except ------------------------------------------------------- as otherwise permitted by this Agreement, all representations by TRW REDI in this Agreement or in any written statement that shall be delivered to COMPS under this Agreement shall be true on and as of the Closing as though made at that time. 11.5 Performance by TRW REDI. TRW REDI shall have performed, ----------------------- satisfied, and complied with all covenants, agreements, and conditions required by this Agreement to be performed or complied with by TRW REDI on or before the Closing. 11.6 Officer's Certificate. Each party shall have received a --------------------- certificate signed by an authorized officer of the other attesting to the satisfaction of the conditions in Sections 10.1, 10.2, 11.4 and 11.3. 15 12. The Closing. The closing of the foregoing transaction (the ----------- "Closing") shall occur at 2:00 p.m. on August 31, 1995 at a site mutually determined by the parties, unless the Agreement is terminated earlier in accordance with Section 13. 12.1 Waiver of Conditions Precedent. COMPS, in its discretion, may ------------------------------ waive one or more of the conditions precedent to COMPS' obligation to perform as described in Section 11 hereof as a condition to the Closing. In the event that COMPS so waives any one or more such condition, TRW REDI agrees that such condition is waived as a condition to Closing only and are not waived as a covenant of TRW REDI hereunder. Without limiting the foregoing, in the event that COMPS waives the obligation of TRW REDI to deliver all the Assets at the Closing, TRW REDI shall, within a reasonable time period but not to exceed thirty (30) days from the Closing, deliver to COMPS any remaining Assets not delivered to COMPS at the Closing. In the event that TRW REDI shall fail to deliver to COMPS any remaining Material Assets (as defined below) not delivered to COMPS at the Closing within thirty (30) days from the Closing, then as liquidated damages hereunder, COMPS shall be entitled to reduce the payment due on 12/l/96 as set forth in Section 2.5 by an aggregate amount equal to $47,500 plus $1,000 per day (up to $30,000) for each day after September 30, 1995 that TRW REDI continues to fail to deliver such remaining Material Assets. TRW REDI acknowledges that, insofar as it would be extremely impracticable and difficult to estimate the actual damages and harm which COMPS would suffer in the event that TRW REDI defaults hereunder and fails to deliver the remaining Material Assets timely hereunder, the parties agree that the sum calculated in accordance with this Section 12.1 is a reasonable estimate of the total net detriment that COMPS would suffer in the event of TRW REDI's failure to deliver the remaining Material Assets by the applicable date. COMPS shall be entitled to retain such liquidated damage sum, and COMPS shall be entitled to an offset against the payment coming due on 12/l/96 for the amounts due COMPS hereunder. For purposes of this Agreement, "Material Assets" shall mean the Accounts Receivable and the books referenced in Section 2.2.4. 12.2 Payment. At the Closing, COMPS shall deliver or cause to be ------- delivered to TRW REDI the initial payment as set forth in Section 2.5. 12.3 Further Documents. At any time before or after the Closing, ----------------- each party shall execute, acknowledge, and deliver any further deeds, assignments, conveyances, and other assurances, documents, and instruments of transfer, reasonably requested by the other, and will take any other action consistent with the terms of this Agreement that may reasonably be requested by the other. 13. Amendments; Term and Termination. -------------------------------- 13.1 Amendments. This Agreement may be amended at any time, but only ---------- by written instrument signed by both parties which refers specifically to this Agreement. 13.2 Term. This Agreement shall have a term of five (5) years (the ---- "Initial Term"). Unless and until terminated as set forth herein, the Renewal Provisions shall be automatically renewed for successive one (1) year terms ("Renewal Term(s)"). Either party may terminate this agreement at the end of the Initial Term or of any Renewal Term by giving the 16 other party one (1) year advance written notice of such termination. For purposes of this section, "Renewal Provisions" means Sections 1, 2.8, 3, 4, 5, 6, 7, 8, 9, 13, and 14 of this Agreement 13.3 Mutual Termination. This Agreement may be terminated by ------------------ mutual agreement at any time, but only by a written instrument signed by both parties specifying the date and time as of such termination. 13.4 Termination for Cause. This Agreement may be terminated --------------------- unilaterally by either party if and when (a) the other party has breached material obligation under this Agreement, (b) the party desiring to terminate has delivered to the breaching party a written demand that the breaching party cure the breach, (c) the breaching party has failed to cure such breach within five (5) days (in the case of the nonpayment of license fees) or sixty (60) days (in the case of any other breach) after receipt of the demand and (d) the party desiring to terminate delivers to the breaching party written notice of termination. A party to this Agreement shall be deemed to have breached a material obligation hereunder if it (a) fails to materially perform its obligations hereunder in accordance with the terms hereof, or breaches any of the covenants, warranties or representations, hereunder, (b) fails to provide any required statement of account or make any payment hereunder as and when such statement is to be provided or such payment is to be made, or (c) becomes insolvent, makes an assignment for the benefit of creditors, suspends its business operations, files a voluntary petition of bankruptcy under federal or state bankruptcy statutes or has filed against it an involuntary petition in bankruptcy which is not dismissed or withdrawn within thirty (30) days of the filing thereof. 13.5 Unilateral Termination by COMPS. COMPS may terminate this ------------------------------- Agreement without cause at any time during the Initial Term by giving TRW REDI one (1) year advance written notice (the "Notice Period") of such termination. If COMPS terminates this Agreement pursuant to this Section 13.5. COMPS agrees to pay TRW REDI, on the final day of the Notice Period, the total amounts still due TRW REDI pursuant to Sections 2.5, 2.5.1, 2.6 and 2.6.1, discounted to the final day of the Initial Term at the net present value rate of Ten Percent (10%). 13.6 Rights Upon Termination. Except as otherwise expressly set ----------------------- forth in this Agreement, upon any expiration or termination of this Agreement, all license grants shall immediately terminate. The obligations of the parties pursuant to Section 2.1.1 (except that only COMPS indemnification obligations pursuant to Section 2.1.1 shall survive termination), Section 2.3, Section 4, Section 7, Section 8, Section 9 and Section 14 shall survive any expiration or termination of this Agreement. In addition, the obligations of TRW REDI set forth in Section 2.7 shall survive any termination of this Agreement for the remainder of the Initial Term, provided COMPS has made the payments described in Section 13.5. 13.6.1 Post-Termination License; Return of Information. In the event ----------------------------------------------- this Agreement terminates pursuant to Sections 13.2 or 13.5, or is terminated by TRW REDI pursuant to Section 13.4, TRW REDI shall receive a fully paid, non- exclusive, non-transferable license to use the COMPS Data available throughout the Term and as of the date of termination of this Agreement, only with respect to properties located within the Photo Illustrated Counties and only for the purpose of the reestablishment of TRW REDI's C&I Photo Illustrated Business and on-line delivery of Investment Property information within such Photo Illustrated Counties. 17 Nothing set forth herein shall obligate COMPS to update, modify or improve such COMPS Data, and TRW REDI shall have no right or license to COMPS Data developed after the date of termination. 14. Miscellaneous. ------------- 14.1 Arbitration. Any controversy or claim arising out of or ----------- relating to this Agreement, or the breach hereof, or the interpretation hereof, that cannot be settled by good faith negotiations between the parties within thirty (30) days, shall be settled by arbitration in accordance with the Rules of the American Arbitration Association; and judgment upon the award rendered in such arbitration shall be final and may be entered in any court having jurisdiction thereof. Notice of the demand for arbitration shall be filed in writing with the other party to this Agreement and with the American Arbitration Association. In no event shall the demand for arbitration be made after the date when institution of legal or equitable proceedings based on such claim, dispute or other matter in question would be barred by the applicable statute of limitations. This agreement to arbitrate shall be specifically enforceable under the prevailing arbitration law. The arbitration or arbitrators in any arbitration proceeding shall be instructed to award attorneys' fees and costs to the prevailing party. 14.2 Waiver. Either party may at any time waive compliance by the ------ other with any covenants or conditions contained in this Agreement, but only by written instrument executed by the party waiving such compliance. No such waiver, however, shall be deemed to constitute the waiver of any such covenant or condition in any other circumstances or the waiver of any other covenant or condition. 14.3 Status. The parties will perform all services hereunder as ------ independent contractors. Nothing contained in this Agreement shall be deemed to create any association, partnership, joint venture, or relationship of principal and agent or master and servant between the parties. 14.4 Excusable Delay. Neither party shall be liable for any delay or --------------- failure in its performance of any of the acts required by this Agreement when such delay or failure arises for reasons beyond the reasonable control of such party. The time for performance of any act delayed by such causes shall be postponed for a period equal to the delay not to exceed sixty (60) days; provided, however, that the party so affected, however, shall use reasonable efforts to avoid or remove such causes of nonperformance and to complete performance of the act delayed, as soon as possible. 14.5 Governing Law. This Agreement will be governed by and construed ------------- in accordance with the internal substantive laws of the State of California, as applied between residents of the State of California. 14.6 Severability. If any provision of this Agreement shall finally ------------ be determined to be unlawful, then such provision shall be deemed to be severed from this Agreement and every other provision of this Agreement shall remain in full force and effect. 14.7 Assignment. This Agreement shall not be assignable by either ---------- party without the prior written consent of the other except to a successor of all, or substantially all, of 18 the business of a party. Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of permitted successors and assigns. 14.8 No Third Parties. Except as expressly provided herein, neither ---------------- this Agreement nor any provisions set forth herein is intended to or shall create any rights in, or confer any benefits upon, any person other than the parties hereto. 14.9 Incorporation by Reference. The Exhibits to this Agreement -------------------------- constitute integral parts of this Agreement and are hereby incorporated into this Agreement by this reference. 14.10 Notices. All notices, requests and other communications ------- hereunder shall be in writing and shall be deemed to have been duly given at the time of receipt if delivered by hand or communicated by electronic transmission, or, if mailed, three (3) days after mailing registered or certified mail, return receipt requested, with postage prepaid (i) if to TRW REDI, then to: TRW REDI Property Data, 5601 East La Palma Avenue, Anaheim, California 92807, Telefax: 714-701-9231, Attention: General Manager, with a copy to the person indicated below TRW REDI's signature; or (ii) if to COMPS, then to: COMPS Infosystems, Inc., 9888 Carroll Centre Road, Suite 100, San Diego, California 92126, Telefax 619-684-3292, Attention: President, provided, however, that if either party shall have designated a different address by notice to the other given as provided above, then to the last address so designated. 14.11 Counterpart. More than one counterpart of this Agreement may ----------- be executed by the parties hereto, and each fully executed counterpart shall be deemed an original without production of the others. 14.12 Complete Agreement. This Agreement sets forth the entire ------------------ understanding of the parties hereto with respect to the subject matter hereof and supersedes all prior letters of intent, agreements, covenants, arrangements, communications, representations, or warranties, whether oral or written, by any officer, employee, or representative of either party relating thereto - except for the letter from TRW REDI to COMPS of August 31, 1995. IN WITNESS WHEREOF, each party hereto has caused this Agreement to be executed by its duly authorized representatives. TRW REDI PROPERTY DATA, COMPS INFOSYSTEMS, INC. an Ohio general partnership a Delaware corporation By: /s/ Edwin P. Setzer By: /s/ Christopher A. Crane ---------------------------- ---------------------------------- Title: President & GM Title: President ------------------------- ----------------------------- 19 A copy of each notice to TRW REDI should A copy of each notice to COMPS should be sent to: be sent to: TRW REDI Property Date COMPS InfoSystems, Inc. - ---------------------------------------- ------------------------------------- 5601 East La Palma Ave. 9888 Carroll Centre Road, Suite 100 - ---------------------------------------- ------------------------------------- Anaheim, CA 92807 San Diego, CA 92126 - ---------------------------------------- ------------------------------------- Telefax: 714.701.9231 Telefax: 619.684.3292 -------------------------------- ----------------------------- Attention: General Manager Attention: President ------------------------------ --------------------------- 20 EXHIBIT A TRW REDI BUSINESS I. C&I Data Extract Business The business of developing, marketing, publishing and selling property and transaction information concerning Investment Property, in whatever form and including without limitation paper, electronic, magnetic, CD-ROM forms, where the publication of such information typically contains a subset of the information provided in the C&I Photo Illustrated Business (described below). Specifically, information provided in the C&I Data Extract Business is typically characterized by the lack of a photograph concerning the investment property, and such information principally consists of public records data enhanced in some instances by the addition of maps and other basic information obtained through a preliminary level of personal research. Such business does not include the resale on a stand-alone basis of Public Record Data Products. II. C&I Photo Illustrated Business The business of developing, marketing, publishing and selling property and transaction information concerning Investment Property, in whatever form and including without limitation paper, electronic, magnetic, CD-ROM forms, where the publication of such information typically contains, with respect to such Investment Property, a photograph or photographs of the Investment Property, confirmed sales information (which may include but not be limited to income information, broker names and addresses, telephone numbers, buyer and seller names and telephone numbers, and contact names and telephone numbers for such parties), property condition, sale price, financing information, market time information, parking space information, cap rate or gross rent multipliers, and technical and non-technical property descriptions. Such business does not include the resale on a stand-alone basis of Public Record Data Products. 21 EXHIBIT B --------- TRW REDI DATA AND LIST PRICE [Insert complete description of TRW REDI Data and list price] 22 EXHIBIT B
ON LINE CD ROM MICROLICHE CALIFORNIA RPF DB SPECIALTY DB REPORT DB DATA MAPS - ---------- Los Angeles 80c - $1.92/min 80c - $2.99/min $ 2-$3.50 $2,700 $1,295 $2,095 Orange 80c - $1.92/min 80c - $2.99/min $ 2-$3.51 $1,200 $ 595 $ 982 Riverside 80c - $1.92/min 80c - $2.99/min $ 2-$3.52 $1,200 $ 525 $ 578 San Bernardino 80c - $1.92/min 80c - $2.99/min $ 2-$3.53 $1,200 $ 525 $ 415 Sam Diego 80c - $1.92/min 80c - $2.99/min $ 2-$3.54 $1,200 $ 595 $ 725 Alameda 80c - $1.92/min 80c - $2.99/min $ 2-$3.55 $1,020 $ 488 $ 495 Contra Costa 80c - $1.92/min 80c - $2.99/min $ 2-$3.56 $1,020 $ 480 $ 495 San Francisco 80c - $1.92/min 80c - $2.99/min $ 2-$3.57 $1,020 $ 488 $ 495 San Mateo 80c - $1.92/min 80c - $2.99/min $ 2-$3.58 $1,020 $ 488 $ 495 Marin 80c - $1.92/min 80c - $2.99/min $ 2-$3.59 $ 900 $ 413 $ 495 Sacramento 80c - $1.92/min 80c - $2.99/min $ 2-$3.60 $1,020 $ 488 $ 495 El Dorado 80c - $1.92/min 80c - $2.99/min $ 2-$3.61 $ 900 $ 413 $ 400 Ventura 80c - $1.92/min 80c - $2.99/min $ 2-$3.62 $1,020 $ 525 $ 625 WASHINGTON - ---------- King 80c - $1.92/min 80c - $2.99/min $ 2-$3.65 $1,195 $ 450 $ 745 ILLINOIS - -------- Cook 80c - $1.92/min 80c - $2.99/min $ 2-$3.68 $3,400 $2,500 $4,115 10-Regions D.C. METRO - ---------- Baltimore City, MD 80c - $1.92/min 80c - $2.99/min $ 2-$3.71 $ 675 N/A $1,110 Baltimore County 80c - $1.92/min 80c - $2.99/min $2-$ 3.72 $ 675 N/A $ 765 Anne Arundel, MD 80c - $1.92/min 80c - $2.99/min $2-$ 3.73 $ 675 N/A $ 660 Montgomery, MD 80c - $1.92/min 80c - $2.99/min $2-$ 3.74 $ 790 N/A $ 785 Prince Georges MD 80c - $1.92/min 80c - $2.99/min $2-$ 3.75 $ 790 N/A $ 785 Washington D.C. 80c - $1.92/min 80c - $2.99/min $2-$ 3.76 $ 900 N/A $1,110 Alexandria, VA 80c - $1.92/min 80c - $2.99/min $2-$ 3.77 $ 550 N/A $ 425 Arlington VA 80c - $1.92/min 80c - $2.99/min $2-$ 3.78 $ 550 N/A $ 425 Fairfax, VA 80c - $1.92/min 80c - $2.99/min $2-$ 3.79 $ 800 N/A $ 750 Loudon, VA 80c - $1.92/min 80c - $2.99/min $2-$ 3.80 $ 550 N/A $ 600 Prince William, VA 80c - $1.92/min 80c - $2.99/min $2-$ 3.81 $ 600 N/A $ 600 New Castle, DE 80c - $1.92/min 80c - $2.99/min $2-$ 3.82 N/A N/A $1,350 HC Aerial HC Flat HC FLAT LID HC MTHLY HC YR END HC VACANT ILLEGIGLE CALIFORNIA Maps Library UPDATE SVC. SALES RPTS SALES RPTS LAND RPT PROT ATLAS - ---------- Los Angeles Orange Riverside San Bernardino Sam Diego Alameda Contra Costa San Francisco San Mateo Marin Sacramento El Dorado Ventura WASHINGTON - ---------- King ILLINOIS - -------- Cook $795 D.C. METRO - ---------- Baltimore City, MD City product is combined with County product. Baltimore County $895 $ 695 $466 $845 $290 $315 Anne Arundel, MD $895 $ 946 $400 $400 $290 Montgomery, MD $895 $1,080 $420 $650 $290 Prince Georges MD $895 $ 960 $426 $650 $290 Washington D.C. $400 $290 $720 Alexandria, VA $355 $185 Arlington VA $355 $185 Fairfax, VA $ 600 $165 $355 $290 Loudon, VA $355 $185 Prince William, VA $355 $185 New Castle, DE $500 $290
PAGE 1 EXHIBIT B
GEORGIA - ------- Cherokee 80c - $1.92/min 80c - $2.99/min $2-$ 3.85 N/A N/A $ 715 City of Atlanta 80c - $1.92/min 80c - $2.99/min $2-$ 3.86 N/A N/A $ 725 Clayton 80c - $1.92/min 80c - $2.99/min $2-$ 3.87 $ 595 N/A $ 850 Cobb 80c - $1.92/min 80c - $2.99/min $2-$ 3.88 $ 595 N/A $ 850 Dekalb 80c - $1.92/min 80c - $2.99/min $2-$ 3.89 $ 595 N/A $ 850 Douglass 80c - $1.92/min 80c - $2.99/min $2-$ 3.90 $ 595 N/A $ 660 Fayette 80c - $1.92/min 80c - $2.99/min $2-$ 3.91 $ 595 N/A $ 660 Forsyth 80c - $1.92/min 80c - $2.99/min $2-$ 3.92 $ 595 N/A $ 660 Fulton 80c - $1.92/min 80c - $2.99/min $2-$ 3.93 $ 695 N/A $1,260 Gwinnet 80c - $1.92/min 80c - $2.99/min $2-$ 3.94 $ 595 N/A $ 805 Hall 80c - $1.92/min 80c - $2.99/min $2-$ 3.95 $ 595 N/A $ 660 Henry 80c - $1.92/min 80c - $2.99/min $2-$ 3.96 $ 595 N/A $ 660 Rockdale 80c - $1.92/min 80c - $2.99/min $2-$ 3.97 $ 595 N/A $ 660 FLORIDA - ------- Brevard 80c - $1.92/min 80c - $2.99/min $2-$ 3.100 $ 595 N/A $1,785 included $ 695 $140 Broward 80c - $1.92/min 80c - $2.99/min $2-$ 3.101 $ 795 N/A $3,535 included Dade 80c - $1.92/min 80c - $2.99/min $2-$ 3.102 $ 795 N/A $3,030 included Hillsborough 80c - $1.92/min 80c - $2.99/min $2-$ 3.103 $ 695 N/A $2,245 included $ 795 $175 Orange 80c - $1.92/min 80c - $2.99/min $2-$ 3.104 $ 695 N/A $2,035 included $ 695 $135 Palm Beach 80c - $1.92/min 80c - $2.99/min $2-$ 3.105 $ 795 N/A $3,155 included $1,500 $205 Pinellas 80c - $1.92/min 80c - $2.99/min $2-$ 3.106 $ 695 N/A $2,025 included $ 895 $170 Sarasota 80c - $1.92/min 80c - $2.99/min $2-$ 3.107 $ 695 N/A $2,360 $750 $ 795 $255 $600 Seminole 80c - $1.92/min 80c - $2.99/min $2-$ 3.108 $ 695 N/A $ 790 $525 $ 795 $140 $800 Volusia 80c - $1.92/min 80c - $2.99/min $2-$ 3.109 $ 695 N/A $1,430 $865 $ 795 $185 $745
PAGE 2 EXHIBIT C-1 ----------- TRW REDI DATA RECORD INPUT LAYOUT [Insert record layout] 23 EXHIBIT C-2 ----------- TRW REDI ONLINE DATA FORMAT [Insert Data Format] 24 Exhibit C-2 Command/Feature: pri 2 -------------------------------------------------------- Address:325 CAJON ST, REDLANDS 92373 County :SAN BERNARDINO CA Land Use :OFFICE BUILDING Lot Size :A.27 Bldg Area: 2,200 New Page : Lot Area :11,920 Rent Area: Map Page :29-C3 Source :I Zoning : Bsmt Area: APN-Acct#:0171-371-04-0000 Ofc. Area: Census Tr:82.00 Year Blt :1930/30 Assessed Land: $39,658 # Bldgs : 1 Park Type:GARAGE Improvement: $68,760 # Stories : 2 Park Spcs:2 Total Value: $108,418 Units : 1 Paving : Assessed Yr:94 CLASS D BUILDING;AVERAGE QUALITY;AVERAGE CONDITION;FRAME $/Sqft : $100.00 CONSTRUCTION;WOOD FRAME;STUCCO/WOOD SIDING;RAISED Price/Un:$220,000 FOUNDATION;GABLE ROOF;COMPOSITION SHINGLE ROOF;FLOOR FURNACE HEAT;WALL A/C;BUILDING SQUARE FOOTAGE PER THE BUYER Publication Reference: BEC-08/95-0069 Legal Dsc:L7 BA /ATWOOD & FORD'S SUB Price : $220,OOOC Sale Date:06/07/95 Cash Down: $121,000 Document#:198109 1st Mtg : $99,000 Int: Yrs: 2nd Mtg : Int: Yrs: Prev Sale: $24,750U Prev Date:07/30/80 Lease:OWNER=USER Buyer :BARRE JUDITH Y Address :612 N LINCOLN ST;REDLANDS,CA 923744151 Seller :UPSTON WILLIAM F Address :325 CAJON ST.;REDLANDS,CA 92373 Lender :CHINO VLY BK (TRW REDI) Incomnet:BDR2183 All Rights Reserved -------------------------------------------------------- 25 Command/Feature: pri 4 -------------------------------------------------- Address:2280 S LILAC AV, RIALTO 92316 County :SAN BERNARDINO CA Land Use :WAREHOUSE Lot Size :A2.92 Bldg Area: 17,264 New Page : Lot Area :1276,195 Rent Area: Map Page :26-C2 Source :I Zoning : Bsmt Area: APN-Acct#:0258-011-21-0000 Ofc. Area: 2,200 Census Tr:36.01 Year Blt :1989/89 Assessed Land: $134,741 # Bldgs : 1 Park Type: Improvement: $419,271 # Stories : 1 Park Spcs: Total Value: $544,012 Units : 1 Paving : Assessed Yr:94 CLASS S BUILDING;AVERAGE QUALITY;AVERAGE CONDITION;METAL $/Sqft : $ 44.89 CONSTRUCTION;STEEL FRAME;METAL SIDING;CONCRETE FOUNDATION Price/Un:$775,000 TRUCK DOORS 2;THIS SALE INCLUDED; ;XS LAND;;NO SPECIFIC VALUE ASSIGNED TO THIS XS LAND Publication Reference: BEC-08/95-0087 Legal Dsc:L2 /B54P20 Price : $775,000C Sale Date:06/05/95 Cash Down : $ 52,000 Document#:194427 1st Mtg : $723,000S Int: Yrs: 2nd Mtg : Int: Yrs: Prev Sale : $115,000U Prev Date:10/02/85 Lease:OWNER=USER Buyer :PACIFIC KILN & INSULATIONS Address :8639 ETIWANDA AVE;RANCHO CUCAMONGA,CA 91739;909/899-1711 Seller :MUNRO CHILDRENS TRUS Address :PO BOX 1219;S. PASADENA,CA 91031 Lender :SELLER Broker :DAN BORIS(L) Address :;714/361-7670 (TRW REDI) Incomnet:BDR1622 All Rights Reserved ------------------------------------------------ Command/Feature: pri 2 -------------------------------------------------- Address:295 -97 ACACIA AV, CARLSBAD 92008 County :SAN DIEGO CA Land Use :APARTMENT Lot Size :A.43 Bldg Area: 9,000 New Page :1106-E6 Lot Area :18,897 Rent Area: Map Page :13-F2 Source : Zoning :R3 Bsmt Area: APN-Acct#:204-240-05-00 Ofc. Area: Census Tr:180.00 Year Blt :1987/87 Assessed Land: $350,000 # Bldgs : 2 Park Type:GARAGE Improvement: $400,000 # Stories : 2 Park Spcs:8 Total Value: $750,000 Units : 8 Paving : Assessed Yr:94 CLASS D BUILDING;AVERAGE QUALITY;AVERAGE CONDITION;FRAME $/Sqft : $95.44 CONSTRUCTION;WOOD FRAME;STUCCO EXTERIOR; SLAB FOUNDATION; G.I.M. : 10.34 FLAT ROOF;BUILT-UP ROOF COVER;FORCED AIR HEAT;NO A/C;NO Cap Rate: 7.05 ELEVATOR;NO FIRE SPRINKLER SYSTEM;6(3+2) $850; 1(2+2);$795 RNT/#/MO: $ 0.76 1(3+2) $900;TOWNHOME; BYR UPLEG 1031; SEVERAL BLKS FROM Price/Un:$107,375 Publication Reference: SDA-08/95-0003 Legal Dsc:PTN OF *L9 BQ/PALISADES UN 02 Price : $859,000C Sale Date:06/05/95 Gross Income : $ 83,040 Cash Down : $719,000 Document#:242492 Expenses : $ 19,132 1st Mtg : $140,000C Int: Yrs:30 Net Income : $ 60,586 2nd Mtg : Int: Yrs: Prev Sale : $900,000C Prev Date:05/16/89 Buyer :POTTER TRUST & MARYANNE MI Address :8775 AERO DR #135;SAN DIEGO,CA 921231779 Seller :TANNER ROB Address :321 WILSHIRE RD;SAN LUIS REY,CA 92068 Lender :HOME SAVINGS OF AM Broker :CREAGAN/ADAMS(L) Address :;619/431-4200 (TRW REDI) Incomnet:BDR3597 All Rights Reserved ------------------------------------------------ Command/Feature: print 2 -------------------------------------------------- Address:274 -276 28 ST, SAN FRANCISCO 94131 County :SAN FRANCISCO CA Land Use :DUPLEX Lot Size :A.06 Bldg Area: 3,184 New Page : Lot Area :2,850 Rent Area: Map Page :14-B1 Source : Zoning :R-3 Bsmt Area: APN-Acct#:6601-018 Ofc. Area: Census Tr:215.00 Year Blt :1927/27 Assessed Land: $ 24,186 # Bldgs : 1 Park Type:BASEMENT Improvement: $ 40,909 # Stories : 2 Park Spcs:1 Total Value: $ 65,095 Units : 2 Paving : Assessed Yr:94 CLASS D BUILDING;GOOD QUALITY;GOOD CONDITION;FRAME $/Sqft :$ 138.19 CONSTRUCTION;WOOD FRAME;STUCCO/WOOD SIDING;CONCRETE G.I.M. : 25.18 FOUNDATION;FLAT ROOF;TAR & GRAVEL ROOF COVER;FLOOR FURNACE Cap Rate: 2.92 HEAT;NO A/C;NO ELEVATOR;NO FIRE SPRINKLER SYSTEM;2(2+1) RNT/#/MO:$ 0.45 ADJUSTABLE RATE RIDER;/UNIT HAS RENT CONTROL Price/Un:$220,000 Publication Reference: SFA-08/95-0083 Legal Dsc:/HORNER'S ADD BL 095 Price : $440,000C Sale Date:05/26/95 Gross Income : $17,472 Cash Down : $44,100 Document#:F797024 Expenses : $ 4,280 1st Mtg : $395,900H Int: 7.12 Yrs:30 Net Income : $12,843 2nd Mtg : Int: Yrs: Type :ACTUAL Buyer :BAERG MARLENE A & ROBERT C Address :274 28TH ST;SAN FRANCISCO,CA 94131 Seller :DREWES FAMILY 1/2 /TR Address :1150 CANTERFORD CIR;WESTLAKE VILLAGE,CA Lender :BANK OF AMERICA Broker :JIM GOODWIN(L) Address :;415/731-9350 (TRW REDI) Incomnet:BDN9444 All Rights Reserved ------------------------------------------------ Command/Feature: pri 2 -------------------------------------------------- Address:ARCHBALD, ONTARIO 91761 County :SAN BARNARDINO CA Land Use :COMMERCIAL ACREAGE Lot Size :A1.07 Bldg Area: New Page : Lot Area :46,800 Rent Area: Map Page :23-A6 Source : Zoning :C1 Bsmt Area: APN-Acct#:0218-021-21-0000 Ofc. Area: Census Tr:22.02 Year Blt : / Assessed Land: $374,400 # Bldgs : Park Type: Improvement: # Stories : Park Spcs: Total Value: $374,400 Units : Paving : Assessed Yr:94 UTILITIES AVAILABLE;PRICE PER DOCUMENT;TRANSFER TAXI; $/Sqft :$11.54 ARCHIBALD STATE HWY Publication Reference: BEC-08/95-0095 Legal Dsc: L1 /B178P30 Price : $540,000F Sale Date:06/14/95 Cash Down : $540,000 Document#:204914 1st Mtg : K Int: Yrs: 2nd Mtg : Int: Yrs: Buyer :WOLFSON & SEGAL REALTY Address :1250 6TH ST #400;SANTA MONICA,CA 90401 Seller :ARCHIBALD ASSOCIATES (TRW REDI) Incomnet:BDS7003 All Rights Reserved ------------------------------------------------ Command/Feature: pri 2 -------------------------------------------------- Address:12335 LLAGAS AV, SAN MARTIN 95046 County :SANTA CLARA CA Land Use :ORCHARD Lot Size :A17.08 Bldg Area: New Page : Lot Area :736,164 Rent Area: Map Page :81-C5 Source :I Zoning :AW Bsmt Area: APN-Acct#:825-01-008+ Ofc. Area: Census Tr:5124.00 Year Blt : / Assessed Land: $ 57,983 # Bldgs : Park Type: Improvement: $ 54,501 # Stories : Park Spcs: Total Value: $112,484 Units : Paving : Assessed Yr:94 UTILITIES AVAILABLE;CHERRY ORCHARD;70 TREES PER ACRE;;FULLY $/Sqft :$0.51 IRRIGATED MKT TIME 3-5 YRS, ESCROW 45 DAYS, 6/95 Publication Reference: SCC-06/95-0055 Multi-APN:825-1-(8,10) Legal Dsc: L11, L112-113 /SAN MARTIN RANCH MA Price : $375,000C Sale Date:04/18/95 Cash Down : $100,000 Document#:12864554 1st Mtg : $275,000S Int: Yrs: 2nd Mtg : Int: Yrs: Buyer :MARIANI MITCHELL L & MARIA Address :1615 HALF RD;MORGAN HILL,CA 950372905;408/779-5467 Seller :ESTATE OF JENNIE MAR Address :420 UNION AVENUE #5;CAMPBELL,CA 95008 Lender :MARFIA, JENNIE Broker :JERRY MARTIN(L) Address :;408/842-0505 (TRW REDI) Incomnet:BDG5037 All Rights Reserved ------------------------------------------------ Command/Feature: DETAIL;pri 3 -------------------------------------------------- Address:11455 -S CLAYTON RD, SAN JOSE 95127 County :SANTA CLARA CA Land Use :PRIVATE SCHOOL Lot Size :A10.00 Bldg Area: 39,750 New Page : Lot Area :435,600 Rent Area: Map Page :56-D6 Source :I Zoning :A SJ Bsmt Area: APN-Acct#:612-38-012 Ofc. Area: Census Tr:5033.12 Year Blt :1975/75 Assessed Land: $72,171 # Bldgs : 8 Park Type:PAVED Improvement: $ 931,811 # Stories: 1 Park Spcs:40 Total Value: $1,003,982 Units : 1 Paving : Assessed Yr:94 CLASS D BUILDING;AVERAGE QUALTIY;AVERAGE CONDITION;FRAME $/Sqft :$28.93 CONSTRUCTION;WOOD FRAME;STUCCO EXTERIOR;SLAB FOUNDATION; LAT ROOF;TAR & GRAVEL ROOF COVER;BUILDING HEATED;PARTIAL A/C;NO ELEVATOR;NO FIRE SPRINKLER SYSTEM;3/95;POOL, RUNNING TRACK & BASKETBALL COURT Publication Reference: SCC-07/95-0009 Legal Dsc:/B80 P39 M Price : $1,150,000C Sale Date:03/31/95 Cash Down: $1,150,000 Document#:12847952 1st Mtg : K Int: Yrs: 2nd Mtg : Int: Yrs: Prev Sale: Prev. Date: Lease:OWNER=USER Buyer : DHARMA REALM BUDDHIST ASSN Address : 11455 CLAYTON RD;SAN JOSE,CA 951275007;408/721-3702 Seller : TWELVEACRES INC Address : 11455 CLAYTON RD;SAN JOSE,CA 95127 Broker : LISA GIIMRE(L) Address : ;408/246-5020 (TRW REDI) Incomnet:BDD6187 All Rights Reserved ------------------------------------------------ APN :279-41-031 Price: $510,000C Date:03/09/95 Bldar:5,238 County:SANTA CLARA CA $/Sq : $97.37 Doc#:12827598 Units:1 MapPg :66-B3 NewPg: AssLd: $ 24,460 Zone:R1 CAStory:1 Source:I (Inc#:BCZ0868) Total: $ 83,445 Lot :14,950 Yrblt:1950/50 Comment:ALSO USED AS A CHURCH ------------------------------------------------ 5) Address:14614 MAGNOLIA ST, WESTMINSTER Use :RELIGIOUS APN :098-391-1B Price:$1,875,000C Date:03/31/95 Bldar:13,900 County:ORANGE CA $/Sq : $134.89 Doc#:137390 Units:480 MapPg :21-E2 NewPg:828-C3 AssdLd: $156,928 Zone:R2 Story:2 Source:I (Inc#:ASN1841) Total: $749,916 Lot :91,040 Yrblt:1963/86 Comment:DBA CHINESE PRESBYTERIAN CHURCH Command/Feature: format 80;pri ---------------------------------------------------- No. Street City St Sale Price Date Bldg Area Unit Lot Area Use 1 1027 S 1 ARCADIA CA $ 600,000C 95/06 6,577 150 17,589 675 2 10844 TUXFORD SUN VALLE CA $ 230,000C 95/05 1,760 1 25,700 675 3 11455 CLAYTON SAN JOSE CA $ 1,150,000C 95/03 39,750 1 435,600 655 4 109 N 1 CAMPBELL CA $ 510,000C 95/03 5,238 1 14,950 675 5 14614 MAGNOLIA WESTMINST CA $ 1,875,000C 95/03 13,900 480 91,040 675 6 4990 BLACK MOUNT SAN DIEGO CA $ 2,100,000C 95/03 5,151 1 203,425 675 EXHIBIT D --------- TRW REDI REVENUES (1994) California On-line $240,000 California Published 260,000 Washington & D.C. 80,000 Chicago 75,000 Quick Source C&I in covered areas 30,000 to 70,000 TOTAL 685,000 to $725,000
25 EXHIBIT E --------- PURCHASED CONTRACTS [To be Completed] 26 EXHIBIT F --------- ACCOUNTS RECEIVABLE 27
- ----------------------------------------------------------------------------------------------------------------------------- CUSTOMER LIST BY REGION Cont $ - ----------------------------------------------------------------------------------------------------------------------------- CUST NAME CUST # CONTRACT # CONT DATE BILL DATE ANN DATE CONT $ Per Hardcopy - ----------------------------------------------------------------------------------------------------------------------------- ILLINOIS - ----------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13266508 253795700 93-05-09 94-08-27 95-08-27 820 495 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13504042 335042500 90-05-23 95-05-28 96-05-28 820 725 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13171079 253163801 93-09-02 94-10-10 95-10-10 595 3,325 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13180624 253347800 86-10-28 94-11-15 95-11-15 820 495 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13172593 232423800 88-08-22 95-04-07 96-04-07 824 495 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13196997 253257800 86-12-19 94-12-24 95-12-24 820 645 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13537909 353317400 91-01-24 95-01-10 96-01-10 820 725 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13569537 355401300 91-07-09 94-05-10 95-09-10 820 795 pi - ----------------------------------------------------------------------------------------------------------------------------- I N *** 10355391 178189201 95-06-08 95-06-10 96-06-10 612 3,200 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13181908 457069000 94-12-14 94-12-30 94-12-30 NO CHG 495 - - ----------------------------------------------------------------------------------------------------------------------------- I A *** 10767512 178198100 93-10-21 95-06-29 96-06-29 1,371 3,915 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13135855 344968403 95-01-15 95-01-15 96-01-15 595 1,634 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13190012 232295801 95-01-05 95-03-07 96-03-07 659 3,390 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13655049 457068000 94-12-22 94-12-30 95-12-30 NO CHG 795 - - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13430358 306796600 95-04-27 95-06-25 96-06-25 820 690 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13056099 148171901 93-06-08 94-07-10 95-12-10 575 1,807 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13211380 253328800 87-02-10 95-02-19 96-02-19 820 645 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13583052 8355452200 93-08-19 93-11-10 95-08-10 595 950 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 10752639 152194100 92-03-24 94-07-28 95-07-28 NO CHG NO CHG - - ----------------------------------------------------------------------------------------------------------------------------- I A *** 10518198 152195100 95-01-19 94-10-13 95-10-13 575 2,890 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13658206 405003201 95-04-03 95-03-26 96-03-26 744 2,678 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13186756 232287800 86-11-14 94-11-19 95-11-19 820 495 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13549269 356237401 95-06-01 95-07-08 96-07-08 595 3,015 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13351813 284553600 88-06-10 94-06-25 95-12-25 820 1,800 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13188110 469100200 93-10-22 95-06-04 96-06-04 820 795 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13628182 405378200 92-09-05 95-03-09 95-09-09 595 3,015 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13608953 377942300 92-04-17 95-06-01 96-09-01 595 795 Disc - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13556906 8355852300 93-07-29 94-10-01 95-10-01 744 2,890 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13547148 8355761300 91-04-02 94-06-15 95-10-15 280 2,890 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13257320 253464701 94-07-01 94-08-27 95-08-27 820 4,010 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 10375944 180711100 86-07-30 94-11-15 95-11-15 595 370 pi - ----------------------------------------------------------------------------------------------------------------------------- I N *** 13751301 9416910000 95-05-08 01-01-01 01-01-01 982 2,975 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13629451 405259200 92-09-11 94-09-30 95-09-30 744 3,370 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13180095 180835100 86-10-24 94-10-15 95-10-15 347 575 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 10527576 158477101 94-03-22 94-10-10 95-10-10 595 3,345 mp - ----------------------------------------------------------------------------------------------------------------------------- I N *** 13183014 253219801 95-05-31 95-07-10 96-07-10 794 2,500 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13662054 447228100 93-04-06 94-07-15 95-07-15 982 2,890 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13308208 254802701 94-12-30 94-12-30 95-12-30 910 2,975 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 10481366 8178157100 88-07-15 95-10-29 95-10-29 595 370 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13106211 267876500 94-01-20 94-12-15 95-12-15 744 2,700 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13166389 249490801 94-10-12 94-11-10 95-11-10 595 1,995 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13666030 447257100 93-05-05 94-07-15 95-09-15 982 3.015 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13189140 249428800 86-11-12 94-11-15 95-11-15 1,985 1,090 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13293032 469091100 93-12-06 94-12-28 95-12-28 820 795 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13498602 334516500 95-01-24 95-04-30 96-04-30 820 725 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13265574 244890800 87-07-16 95-07-21 96-07-21 820 645 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13189117 253276800 86-11-24 95-01-15 96-01-15 595 3,995 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13183218 249422800 93-08-19 94-11-10 95-11-10 820 495 pi - ----------------------------------------------------------------------------------------------------------------------------- I N *** 13585489 355509301 95-05-19 95-05-10 96-05-10 842 2,678 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13170805 232413800 86-09-24 94-10-04 95-10-04 820 495 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13185191 278214800 86-11-07 94-11-17 95-11-17 820 495 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13436293 306746600 89-07-14 95-07-28 96-07-28 820 690 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13215403 253359800 87-02-19 95-02-26 96-02-26 820 805 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13524565 334912400 93-07-21 94-10-10 95-10-10 595 725 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13182314 253185800 90-10-18 94-10-29 95-10-29 744 M M - ----------------------------------------------------------------------------------------------------------------------------- I M *** 13678363 447233100 93-07-27 94-10-16 96-02-16 491 2,890 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13099764 227701900 93-10-27 95-06-15 96-06-15 595 2,265 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 10726650 178156100 94-09-29 94-10-10 95-10-10 595 370 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13180679 253288800 94-02-16 95-06-19 96-06-19 1,285 3,295 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13188235 253192800 93-08-24 94-11-10 95-11-10 820 495 pi - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13106233 249921901 95-04-11 95-04-15 96-04-15 1,071 2,678 mp - ----------------------------------------------------------------------------------------------------------------------------- I A *** 13218004 253624800 93-08-25 94-11-10 95-11-10 1,3375 495 mp - ----------------------------------------------------------------------------------------------------------------------------- I N *** 13412701 306640600 89-03-31 95-04-07 96-04-07 820 690 pi - ----------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------- OUT- Cur DAYS PAST DUE TOTAL - ----------------------------------------------------------------------------------------------------------------------------- CUST NAME STANDING Due 30 60 90 120 150+ REC UNBILLED TERMS - ----------------------------------------------------------------------------------------------------------------------------- ILLINOIS - ----------------------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------------------- I A *** 820 820 820 0 6 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 463 149 149 314 6 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 820 820 820 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 508 73 73 434 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 10 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I N *** 612 450 450 161 10 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 NET 30 DAYS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 321 64 64 257 10 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 820 149 149 299 521 6 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 10 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 PO - ----------------------------------------------------------------------------------------------------------------------------- I A *** 571 82 82 489 10 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 595 0 595 10 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 6 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 820 149 149 299 521 6 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 595 0 595 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 595 0 595 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 744 66 66 677 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I N *** 982 0 982 10 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 3 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I N *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 744 66 66 66 66 66 199 531 213 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 982 90 99 179 802 12 PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I N *** 0 0 NET 3 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 6 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 181 149 149 31 6 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I M *** 491 123 123 368 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 1,285 0 1,285 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 1,071 0 1,071 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------- I N *** 820 820 820 0 NET 30 - -----------------------------------------------------------------------------------------------------------------------------
For each agreement referred herein: A = assignable; N = non-assignable; M = unlocated. Page 1 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.
CUSTOMER LIST BY REGION - ------------------------------------------------------------------------------------------------------------------------ Cont $ - ------------------------------------------------------------------------------------------------------------------------ CUST NAME CUST # CONTRACT # CONT DATE BILL DATE ANN DATE CONT $ Per Hardcopy - ------------------------------------------------------------------------------------------------------------------------ A *** 13676620 447407100 93-07-21 94-09-27 95-09-27 1,589 2,890 mp - ----------------------------------------------------------------------------------------------------------------------- I A *** 13133064 249546800 93-07-21 94-10-10 95-10-10 595 1,975 mp - ----------------------------------------------------------------------------------------------------------------------- I A *** 13060577 334349400 90-12-11 94-12-18 95-12-18 595 425 pi - ----------------------------------------------------------------------------------------------------------------------- I A *** 13706295 405564100 94-03-28 95-03-30 96-03-30 820 820 -- - ----------------------------------------------------------------------------------------------------------------------- I A *** 13221682 253782800 95-06-01 95-07-10 96-07-10 595 2,795 mp - ----------------------------------------------------------------------------------------------------------------------- I A *** 13352106 284365600 90-07-30 94-07-10 95-12-10 1,060 1,485 mp - ----------------------------------------------------------------------------------------------------------------------- I A *** 13512702 334632400 92-07-17 94-07-23 95-12-23 744 725 -- - ----------------------------------------------------------------------------------------------------------------------- I N *** 13532643 353637401 95-01-19 95-02-10 96-02-10 2,460 2,940 mp - ----------------------------------------------------------------------------------------------------------------------- I A *** 13198807 253475800 93-09-27 94-12-31 95-12-31 744 645 pi - ----------------------------------------------------------------------------------------------------------------------- I N *** 13537910 353619401 95-01-24 95-04-10 96-04-10 489 2,620 mp - ----------------------------------------------------------------------------------------------------------------------- I N *** 13564026 8355823302 95-02-07 95-02-10 95-09-10 360 360 -- - ----------------------------------------------------------------------------------------------------------------------- I A *** 13187537 253411700 88-06-22 94-07-05 96-01-05 595 765 disc - ----------------------------------------------------------------------------------------------------------------------- I A *** 13608384 405205200 92-07-02 94-07-10 95-07-10 820 820 -- - ----------------------------------------------------------------------------------------------------------------------- I A *** 13423266 306561600 89-05-17 95-06-16 96-06-16 1,952 5,110 mp - ----------------------------------------------------------------------------------------------------------------------- I M *** 13299551 8255357600 93-08-25 94-11-10 95-11-10 744 M M - ----------------------------------------------------------------------------------------------------------------------- I A *** 13250941 253846800 87-05-29 95-07-21 96-07-21 595 2,585 mp - ----------------------------------------------------------------------------------------------------------------------- I A *** 13293247 255317700 87-10-20 94-11-16 95-11-16 595 645 -- - ----------------------------------------------------------------------------------------------------------------------- I A *** 13517110 334683500 91-02-28 95-05-01 96-05-01 595 3,010 mp - ----------------------------------------------------------------------------------------------------------------------- I A *** 10388894 180713100 91-04-02 94-05-28 95-10-28 595 CR -- - ----------------------------------------------------------------------------------------------------------------------- I A *** 13300925 8254734800 92-04-22 95-05-04 96-05-04 595 2,580 mp - ----------------------------------------------------------------------------------------------------------------------- I N *** 13527313 353540401 95-01-24 95-02-13 96-02-13 659 3,295 mp - ----------------------------------------------------------------------------------------------------------------------- I A *** 13242423 253667700 88-02-23 94-04-26 95-09-26 655 645 -- - ----------------------------------------------------------------------------------------------------------------------- I A *** 13050938 8136511000 90-04-02 95-06-07 96-06-07 1,045 CR -- - ----------------------------------------------------------------------------------------------------------------------- I A *** 13186312 253407701 93-08-17 94-09-10 95-09-10 595 495 pi - ----------------------------------------------------------------------------------------------------------------------- I A *** 13226982 253634800 92-03-11 95-06-01 96-06-01 851 695 pi - ----------------------------------------------------------------------------------------------------------------------- I A *** 13149348 258326502 94-06-10 94-06-10 95-06-10 368 2,312 mp - ----------------------------------------------------------------------------------------------------------------------- I A *** 13187427 269430800 93-08-01 94-11-20 95-11-20 820 895 -- - ----------------------------------------------------------------------------------------------------------------------- I A *** 13188213 253409800 86-11-21 95-08-15 96-08-15 820 495 pi - ----------------------------------------------------------------------------------------------------------------------- I A *** 13155617 231658801 94-04-13 94-08-04 95-08-04 820 820 -- - ----------------------------------------------------------------------------------------------------------------------- I A *** 13477197 31965500 93-10-21 95-01-27 96-01-27 1,351 2,795 mp - ----------------------------------------------------------------------------------------------------------------------- *** - ----------------------------------------------------------------------------------------------------------------------- *** - ----------------------------------------------------------------------------------------------------------------------- *** - ----------------------------------------------------------------------------------------------------------------------- *** 93 72,150 150,025 - ----------------------------------------------------------------------------------------------------------------------- *** - ----------------------------------------------------------------------------------------------------------------------- *** - ----------------------------------------------------------------------------------------------------------------------- *** - ----------------------------------------------------------------------------------------------------------------------- *** - ----------------------------------------------------------------------------------------------------------------------- *** - ----------------------------------------------------------------------------------------------------------------------- A *** 13090978 470977200 93-06-15 95-07-10 96-07-10 1,634 1,200 pi - ----------------------------------------------------------------------------------------------------------------------- A *** 10092537 501775000 94-09-29 94-10-10 95-10-10 3,128 3,128 -- - ----------------------------------------------------------------------------------------------------------------------- M *** 10092537 501775001 94-11-16 94-12-27 95-12-27 1,000 M M - ----------------------------------------------------------------------------------------------------------------------- A *** 13735079 475650000 94-12-12 95-02-01 96-02-01 725 725 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13735079 475649000 94-12-27 94-12-27 95-12-27 775 775 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13723342 417967000 94-08-16 94-08-30 95-08-30 800 708 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13505605 489062100 95-05-22 95-06-10 96-06-10 NO CHARGE NO CHARGE -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13723560 492719000 94-08-24 94-10-01 95-10-01 775 775 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 14809780 492401000 94-09-12 94-10-10 95-10-10 1,275 1,275 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13164321 417498101 94-12-05 94-12-01 95-12-01 2,808 3,744 disc - ----------------------------------------------------------------------------------------------------------------------- A *** 13562785 475795002 94-12-14 95-04-10 96-04-10 536 536 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13592443 944180100 93-03-03 94-10-01 95-10-01 NO CHARGE NO CHARGE -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13631969 485576100 93-08-11 94-08-17 95-08-17 0 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13654886 419604200 93-01-25 95-02-28 96-02-28 0 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 10098171 497442000 94-07-15 94-08-09 95-08-09 553 553 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13675584 417750200 93-07-06 95-07-10 96-07-10 0 0 Can - ----------------------------------------------------------------------------------------------------------------------- A *** 13739772 499907000 95-01-19 95-03-01 96-03-01 708 708 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13446049 390235300 92-01-16 95-03-06 96-03-06 708 576 pi - ----------------------------------------------------------------------------------------------------------------------- A *** 10008631 418966100 94-06-08 94-10-10 95-10-10 6,000 5,995 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13665277 431158200 93-04-30 95-05-04 96-05-04 1,500 1,368 pi - ----------------------------------------------------------------------------------------------------------------------- A *** 13593992 424614200 92-11-18 94-12-01 95-12-01 708 708 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 10024044 499952000 94-10-03 94-10-10 95-10-10 775 775 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13684728 418867103 93-11-30 94-12-21 95-12-02 3,792 3,408 pi - ----------------------------------------------------------------------------------------------------------------------- A *** 10308832 497330000 94-06-17 94-10-01 95-10-01 775 775 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 10307163 944500200 93-07-01 95-07-01 96-07-01 708 708 -- - ----------------------------------------------------------------------------------------------------------------------- A *** 13719833 499698000 94-07-14 94-10-01 95-10-01 6,810 6,810 -- - -----------------------------------------------------------------------------------------------------------------------------------
CUSTOMER LIST BY REGION - ----------------------------------------------------------------------------------------------------------------------------------- OUT- Cur TOTAL CUST NAME STANDING Due 30 60 90 120 150+ REC UNBILLED TERMS - ----------------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------- I A *** 595 52 52 543 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ I A *** - 0 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ I A *** 595 595 595 0 12 MO PMTS - ------------------------------------------------------------------------------------------------------------------------------------ I A *** 1,060 0 1,060 6 MO PMTS - ------------------------------------------------------------------------------------------------------------------------------------ I A *** - 0 0 0 12 MO PMTS - ------------------------------------------------------------------------------------------------------------------------------------ I N *** 2,460 223 223 2,237 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------------- I A *** 744 434 434 310 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------------- I N *** 489 489 489 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------- I N *** - 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 0 3 PMTS - ---------------------------------------------------------------------------------------------------------------------------------- I A *** - 0 0 0 6 MO PMTS - ---------------------------------------------------------------------------------------------------------------------------------- I A *** 1,952 208 208 417 1,535 10 MO PMTS - ---------------------------------------------------------------------------------------------------------------------------------- I M *** 0 0 0 12 MO PMTS - ------------------------------------------------------------------------------------------------------------------------------------ I A *** 0 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ I A *** - 0 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ I A *** 595 595 595 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ I A *** - 0 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------- I N *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------- I A *** - 0 0 0 12 MO PMTS - ------------------------------------------------------------------------------------------------------------------------------------ I A *** - 1,045 1,045 1,045 0 NET 40 - ------------------------------------------------------------------------------------------------------------------------------------ I A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------- I A *** 851 76 76 152 700 12 MO PMTS - ----------------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ I A *** - 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------- I A *** 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------- I A *** - 0 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ I A *** 1,351 118 118 1,233 12 MO PMTS - ------------------------------------------------------------------------------------------------------------------------------------ *** - ------------------------------------------------------------------------------------------------------------------------------------ *** - ------------------------------------------------------------------------------------------------------------------------------------ *** - ------------------------------------------------------------------------------------------------------------------------------------ *** 26,574 3,318 1,814 2,030 156 186 1,839 9,044 17,531 - ------------------------------------------------------------------------------------------------------------------------------------ *** - ------------------------------------------------------------------------------------------------------------------------------------ *** - ------------------------------------------------------------------------------------------------------------------------------------ *** - ------------------------------------------------------------------------------------------------------------------------------------ *** - ------------------------------------------------------------------------------------------------------------------------------------ *** - ------------------------------------------------------------------------------------------------------------------------------------ A *** 1,634 0 1,634 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ M *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 391 65 65 65 65 65 325 66 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 713 418 70 70 70 70 713 0 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 0 0 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 138 138 138 0 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------------------------ A *** 779 283 283 496 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 514 47 47 467 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 0 0 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 0 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** 0 0 6 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 0 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** 0 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------- A *** - 0 0 12 MO. PYMTS. - ----------------------------------------------------------------------------------------------------------------------------------- A *** 492 164 164 328 164 10 MO. PYMTS. - ----------------------------------------------------------------------------------------------------------------------------------- A *** - 0 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** 0 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 0 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 733 0 733 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------------------------ A *** - 6,810 568 568 568 568 568 1,703 4,540 2,270 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------------------------
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. 2
- ----------------------------------------------------------------------------------------------------------- CUSTOMER LIST BY REGION Conl $ OUT- - ----------------------------------------------------------------------------------------------------------- CUST NAME CUST # CONTRACT # CONT DATE BILL DATE ANN DATE CONT $ Per Hardcopy STANDING - ----------------------------------------------------------------------------------------------------------- A *** 10038380 382027300 93-12-01 95-03-10 96-03-10 3,289 2,760 pi 3,289 - ----------------------------------------------------------------------------------------------------------- A *** 10006952 492640100 94-11-30 95-10-01 96-06-30 1,500 1,500 - 1,500 - ----------------------------------------------------------------------------------------------------------- A *** 10048459 492639100 94-11-30 95-10-01 96-06-30 750 750 - 750 - ----------------------------------------------------------------------------------------------------------- A *** 10330831 492638100 94-11-30 95-10-01 96-06-30 750 750 - 750 - ----------------------------------------------------------------------------------------------------------- A *** 13677627 485385102 94-07-01 94-07-01 94-09-30 550 550 - 550 - ----------------------------------------------------------------------------------------------------------- A *** 13677627 485386102 94-07-01 94-07-01 94-09-30 138 550 dg 138 - ----------------------------------------------------------------------------------------------------------- A *** 13677627 485388102 94-07-01 94-07-01 94-09-30 138 550 dg 138 - ----------------------------------------------------------------------------------------------------------- A *** 13713194 499901000 94-09-19 94-09-21 95-09-21 3,900 3,900 - - ----------------------------------------------------------------------------------------------------------- A *** 13731176 464681000 94-11-01 94-11-10 95-11-10 6,197 6,197 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 14292029 499429100 94-07-11 95-07-21 96-07-21 775 800 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 13718955 493265100 94-11-30 95-10-01 96-06-30 2,000 2,000 - 1,000 - ----------------------------------------------------------------------------------------------------------- A *** 13529054 492629100 94-11-30 95-10-01 96-06-01 4,000 4,000 - 3,000 - ----------------------------------------------------------------------------------------------------------- A *** 13688959 944340200 93-06-23 95-06-30 96-06-30 0 0 Can 0 - ----------------------------------------------------------------------------------------------------------- A *** 13417953 499693001 94-06-13 94-07-01 95-07-01 4,992 4,992 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 13688443 944170100 93-01-28 94-10-01 95-10-01 NO CHARGE NO CHARGE - 0 - ----------------------------------------------------------------------------------------------------------- A *** 10030607 433331200 92-12-04 95-01-20 96-01-20 1,368 1,368 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 14113588 423322100 93-10-10 94-09-10 95-09-10 219 219 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 13593619 469634100 93-07-30 94-08-13 95-08-13 900 900 - 900 - ----------------------------------------------------------------------------------------------------------- A *** 17788897 501638000 94-09-07 94-12-10 95-12-10 708 708 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 10310875 501515000 94-06-01 94-06-01 95-09-01 NO CHARGE NO CHARGE - 0 - ----------------------------------------------------------------------------------------------------------- A *** 10047753 390492200 93-02-16 95-05-10 96-05-10 708 708 - 660 - ----------------------------------------------------------------------------------------------------------- A *** 14292018 448376200 93-03-25 95-04-02 96-04-02 708 708 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 13670918 440268200 93-06-02 95-06-10 96-06-10 708 708 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 13716937 500168100 94-06-17 95-06-30 96-06-30 1,500 1,500 - 1,500 - ----------------------------------------------------------------------------------------------------------- A *** 10062358 492950000 94-10-07 95-01-19 96-01-19 2,400 2,400 - 1,848 - ----------------------------------------------------------------------------------------------------------- A *** 10062358 499906000 94-12-01 95-01-17 96-01-17 600 600 - 375 - ----------------------------------------------------------------------------------------------------------- A *** 13714838 501569100 94-05-18 95-06-09 96-06-09 708 708 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 14350961 944320100 95-02-06 95-02-21 96-02-21 708 708 - 615 - ----------------------------------------------------------------------------------------------------------- A *** 13689538 406545100 93-10-10 94-10-10 95-10-10 2,592 2,203 pi 0 - ----------------------------------------------------------------------------------------------------------- A *** 13615641 497405000 94-06-03 94-10-10 95-10-10 6,000 6,000 - 5,925 - ----------------------------------------------------------------------------------------------------------- A *** 13615641 497408000 94-06-08 94-10-10 95-10-10 500 500 - 100 - ----------------------------------------------------------------------------------------------------------- A *** 13720970 500188000 97-07-26 94-08-03 95-08-03 775 775 - - ----------------------------------------------------------------------------------------------------------- A *** 10085506 496058000 95-05-01 95-05-10 96-05-10 1,275 1,275 - 1,275 - ----------------------------------------------------------------------------------------------------------- A *** 10085430 471102200 93-06-21 95-06-10 96-06-10 1,368 1,488 1,161 - ----------------------------------------------------------------------------------------------------------- A *** 13427530 497001000 94-10-26 95-01-10 96-01-10 5,150 5,150 - 5,150 - ----------------------------------------------------------------------------------------------------------- A *** 13420292 500176000 94-06-24 94-12-02 95-12-02 400 400 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 13128707 944390201 94-06-15 95-06-15 96-06-15 708 586 pi 611 - ----------------------------------------------------------------------------------------------------------- A *** 10062688 499877000 94-10-13 94-12-31 95-12-31 3,450 3,450 - 1,448 - ----------------------------------------------------------------------------------------------------------- A *** 10062688 499877001 94-12-02 94-12-31 95-12-31 660 660 - 275 - ----------------------------------------------------------------------------------------------------------- A *** 10062677 430010200 93-09-17 94-10-10 95-10-10 708 672 pi 0 - ----------------------------------------------------------------------------------------------------------- A *** 10062688 499875000 94-10-13 94-11-15 95-11-15 690 690 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 10062688 499876000 94-10-13 94-10-26 95-10-26 690 690 - - ----------------------------------------------------------------------------------------------------------- A *** 13085088 475799000 94-12-29 95-06-10 96-06-10 775 775 - 733 - ----------------------------------------------------------------------------------------------------------- A *** 13587531 381878301 94-10-13 95-01-10 96-01-10 1,368 1,284 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 13733927 475414000 94-11-29 94-12-10 95-12-10 698 775 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 10084549 944470201 95-04-11 95-06-10 96-06-10 2,700 2,600 pi 2,497 - ----------------------------------------------------------------------------------------------------------- A *** 13733927 475414000 94-11-29 94-12-10 95-12-10 698 700 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 10049221 430822200 94-05-20 95-07-10 96-07-10 1,368 1,368 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 13688285 944090100 93-03-28 94-10-01 95-10-01 NO CHARGE NO CHARGE - 0 - ----------------------------------------------------------------------------------------------------------- A *** 10063263 487731000 95-04-25 95-09-10 96-09-10 5,949 5,924 - 5,949 - ----------------------------------------------------------------------------------------------------------- A *** 10063285 417422101 94-09-19 94-10-05 95-10-05 1,026 1,026 - 13 - ----------------------------------------------------------------------------------------------------------- M *** 10314426 431774200 93-04-02 95-04-19 96-04-19 775 944 dr 0 - ----------------------------------------------------------------------------------------------------------- A *** 10314426 491462100 94-01-14 95-01-25 96-01-25 708 M M 0 - ----------------------------------------------------------------------------------------------------------- A *** 13738672 478907000 95-03-17 95-03-01 96-03-01 620 620 - 620 - ----------------------------------------------------------------------------------------------------------- A *** 13185540 501507100 94-06-06 95-07-01 96-07-01 2,850 2,850 - - ----------------------------------------------------------------------------------------------------------- A *** 13643064 421014201 94-11-15 94-10-10 95-10-10 3,600 3,600 - 432 - ----------------------------------------------------------------------------------------------------------- A *** 13741070 464788000 95-02-03 95-02-27 96-02-27 5,900 5,900 - 2,963 - ----------------------------------------------------------------------------------------------------------- A *** 10015963 419562201 94-05-11 95-06-01 96-06-01 1,368 1,368 - 1,368 - ----------------------------------------------------------------------------------------------------------- A *** 12318365 408158200 93-06-30 95-07-10 96-07-10 1,500 1,500 - 1,500 - ----------------------------------------------------------------------------------------------------------- A *** 13688274 94480100 94-04-29 94-10-10 95-10-10 NO CHARGE NO CHARGE - 0 - ----------------------------------------------------------------------------------------------------------- A *** 13675629 471138200 94-06-21 95-07-10 96-07-10 1,500 1,500 - 1,500 - ----------------------------------------------------------------------------------------------------------- A *** 14041003 393371300 92-09-01 94-11-10 95-11-10 1,151 0 - ----------------------------------------------------------------------------------------------------------- A *** 14041003 393371204 95-04-25 95-06-22 96-06-22 775 775 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 14041003 393371400 94-03-14 95-03-21 96-03-21 2,592 2,592 - 0 - ----------------------------------------------------------------------------------------------------------- A *** 13729001 492364000 94-10-10 94-11-01 95-11-01 1,800 1,800 - 0 - ----------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------- CUR DAYS PAST DUE TOTAL - ------------------------------------------------------------------------------------------------------------------- CUST NAME DUE 30 60 90 120 150+ REC UNBILLED TERMS - ------------------------------------------------------------------------------------------------------------------- A *** 3,289 3,289 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 1,500 PURCH ORDER - ------------------------------------------------------------------------------------------------------------------- A *** 0 750 PURCH ORDER - ------------------------------------------------------------------------------------------------------------------- A *** 0 750 PURCH ORDER - ------------------------------------------------------------------------------------------------------------------- A *** 550 550 0 PURCH ORDER - ------------------------------------------------------------------------------------------------------------------- A *** 138 138 0 PURCH ORDER - ------------------------------------------------------------------------------------------------------------------- A *** 138 138 0 PURCH ORDER - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 1,000 1,000 0 PURCH ORDER - ------------------------------------------------------------------------------------------------------------------- A *** 0 3,000 PURCH ORDER - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 WRITE OFF - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 93 93 808 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 73 73 147 513 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 508 508 1,017 483 3 MO. PYMT. - ------------------------------------------------------------------------------------------------------------------- A *** 243 243 243 243 970 878 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 63 63 63 188 188 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 461 77 77 615 0 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 600 600 600 600 600 2,925 5,925 0 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 50 50 100 0 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 106 106 1,169 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 106 106 1,055 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 5,150 5,150 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 61 61 550 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 290 290 1,158 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 55 55 220 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 67 67 667 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO. PYMTS - ------------------------------------------------------------------------------------------------------------------- A *** 227 227 2,270 12 MO. PYMTS - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO. PYMTS - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 5,949 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 13 13 0 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- M *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 58 58 58 174 446 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 363 363 70 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 593 593 2,370 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 1,368 1,368 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 137 137 1,363 12 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 165 165 1,335 10 MO. PYMTS. - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ------------------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO. PYMTS. - -------------------------------------------------------------------------------------------------------------------
Page 3 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.
- ---------------------------------------------------------------------------------------------------------------------------------- CUSTOMER LIST BY REGION Cont $ OUT- Cur CUST NAME CUST # CONTRACT # CONT DATE BILL DATE ANN DATE CONT $ Per Hardcopy STANDING Due - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13297522 413677200 92-12-04 95-01-10 96-01-10 708 708 367 61 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13683802 944360200 93-05-21 95-05-30 96-05-30 2,595 2,592 2,219 218 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10303673 49270200 94-09-16 94-09-23 95-09-23 8,000 8,000 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13641217 433322200 92-11-30 94-10-10 95-10-10 4,641 4,641 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13723814 437428000 94-08-30 94-09-10 95-09-10 1,500 1,500 386 137 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13485554 492783000 94-12-01 94-12-15 95-12-15 775 775 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10051028 427500100 93-08-10 94-11-10 95-11-10 4,800 4,800 1,448 965 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10051028 487790100 94-04-13 94-05-01 95-05-01 3,625 3,625 965 483 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13740552 49990900 95-02-10 95-02-16 96-02-16 4,800 4,800 3,217 402 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13731558 492742000 94-11-10 94-11-18 95-11-18 775 775 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13576078 501422000 95-03-06 95-03-27 96-03-27 730 730 593 66 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13576078 501423000 94-10-19 94-11-10 95-11-10 775 775 593 66 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13708064 492072101 95-06-02 95-07-15 96-07-15 2,500 2,500 2,500 210 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10094984 944270100 93-10-08 94-10-01 95-10-01 NO CHARGE NO CHARGE 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13734924 478718000 94-12-07 95-06-30 95-12-27 2,757 2,732 2,757 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13018453 418946100 94-12-23 94-10-01 95-10-01 2,156 1,992 ug 2,156 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13359394 413376100 93-03-04 94-03-10 95-03-10 3,402 3,402 ug - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13635573 410863101 93-09-28 94-01-10 95-01-10 3,744 3,744 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13512609 418594200 94-01-05 94-02-21 95-02-21 3,048 3,048 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13528895 433329200 94-01-24 95-02-08 96-02-08 708 708 - 367 73 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10328573 499696000 94-07-07 94-08-01 95-08-01 1,500 1,500 - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10304636 486449100 94-12-29 94-11-10 95-11-10 3,000 3,000 - - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13545050 418634300 92-08-27 95-04-01 96-04-01 708 708 - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10099859 497333000 94-09-09 94-09-19 95-09-19 1,500 1,500 - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13545050 418634301 94-04-02 95-04-08 96-04-8 685 685 - 685 114 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13687699 492473000 94-10-28 94-12-10 95-12-10 775 775 - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10051996 432624200 94-03-09 95-02-01 96-02-01 1,368 1,080 ug 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13564275 433385200 93-03-17 95-06-30 96-06-30 708 708 - - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10052252 419099200 92-12-18 95-04-10 96-04-10 1,368 1,368 - - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13715158 437436100 94-05-26 95-05-10 96-05-10 1,368 1,248 pi 1,368 116 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13714407 501109100 94-05-25 95-06-10 96-06-10 1,368 1,368 - 1,368 1,368 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13689901 327631501 94-01-13 95-01-13 96-01-13 2,882 2,640 pi 2,882 2,882 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10089726 419936100 94-03-10 94-03-10 95-06-15 635 635 - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13645457 419233200 92-12-03 94-12-17 95-12-17 708 708 - 788 79 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13689440 475834000 95-03-17 95-04-30 96-04-30 3,000 3,000 - 2,118 2,118 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13053418 464162000 95-04-10 95-10-10 96-10-10 1,425 1,425 - 1,329 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10078735 486496000 94-09-01 94-12-31 95-12-31 2,592 2,592 - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13740518 464558000 94-12-14 95-02-16 96-02-16 775 775 - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 14276898 424579201 94-04-19 95-07-28 96-07-28 792 792 - - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13672725 470985200 93-12-23 95-06-24 96-06-24 0 0 Can - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13750249 463841000 95-05-04 95-05-17 96-05-17 800 795 - 800 266 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10053790 382179301 94-12-16 95-02-24 96-06-24 1,284 1,284 - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13672736 470986200 93-12-05 95-06-23 96-06-23 0 0 Can 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13743483 464012000 95-03-07 95-03-09 96-03-09 840 840 - 519 87 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13720712 483880000 94-07-14 94-07-10 95-11-10 776 775 - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10024167 467166000 95-05-18 95-05-10 96-05-10 695 695 - 695 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13702219 427259100 94-01-31 95-02-23 96-02-23 0 0 Can - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13683813 469832101 95-03-01 94-12-01 95-12-01 995 1,095 dg 271 109 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13716610 501595000 94-06-13 94-10-10 95-10-10 6,835 6,810 pi 7,553 570 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10092869 492701000 94-09-06 95-01-10 96-01-10 775 775 - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13748161 466603000 95-04-06 95-04-28 96-04-28 NO CHARGE NO CHARGE - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13714755 501584100 94-05-27 95-06-15 96-06-15 708 775 - 791 132 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13753020 475456000 95-05-23 95-05-10 96-05-10 300 300 - 300 35 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13753020 475456001 95-05-23 95-05-10 96-11-10 300 300 - 300 32 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13687600 431112100 95-05-22 95-06-02 96-06-02 708 708 - - ---------------------------------------------------------------------------------------------------------------------------------- M *** 13687600 475628000 93-10-13 94-10-10 95-10-10 708 708 - 648 59 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13038035 448917100 93-08-19 94-08-27 95-08-27 2,203 2,203 - 1,162 222 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13715181 458201100 94-05-26 95-05-10 96-05-10 1,368 1,248 pi 1,161 1,161 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13720169 469399000 94-07-11 94-08-02 95-08-02 708 708 - 603 60 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13614376 427253100 93-09-23 94-10-10 95-10-10 8,400 8,400 - 843 843 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13672747 470988200 93-06-21 95-06-23 96-06-23 NO CHARGE NO CHARGE - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13737077 475401000 95-01-01 95-01-13 96-01-13 5,490 5,490 - 3,203 458 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13748950 500544000 95-04-14 95-04-28 96-04-28 200 200 - 0 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 10087605 491700101 94-12-22 94-12-29 95-12-29 1,296 1,296 - - ---------------------------------------------------------------------------------------------------------------------------------- A *** 13486304 421117101 93-12-16 94-12-30 95-12-30 600 600 - - ----------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------- DAYS PAST DUE TOTAL CUST NAME 30 60 90 120 150+ REC UNBILLED TERMS - ---------------------------------------------------------------------------------------------------------------------------------- A *** 61 305 12 MO.PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 218 2 ,001 12 MO.PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 137 249 12 MO.PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 3 QTRLY PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 965 483 10 MO.PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 483 965 0 10 MO.PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 402 2,815 12 MO.PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 66 527 12 MO.PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 66 527 12 MO.PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 210 2,290 12 MO.PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 12 MO.PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 2,757 2,757 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 2,156 2,156 0 PURCHASE ORDER - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 PURCHASE ORDER - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 PURCHASE ORDER - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 PURCHASE ORDER - ---------------------------------------------------------------------------------------------------------------------------------- A *** 73 293 10 MO.PYMTS - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO.PYMTS - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 3 QTRLY PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 6 MO PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 114 571 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 10 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 3 QTRLY PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 232 348 1,020 12 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 1,368 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 2,882 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 10 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 79 79 79 79 314 708 80 10 MO. PYMTS. - ----------------------------------------------------------------------------------------------------------------------------------- A *** 2,118 0 10 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 1,329 12 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 266 266 798 2 3 QTRLY PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 87 433 10 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 695 695 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 10 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 109 162 10 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 570 570 570 570 3,987 6,835 718 12 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 132 264 527 6 MO PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 35 70 230 10 MO. PYMTS. --------------------------------------------------------------------------------------------------------------------------------- A *** 32 65 235 10 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- M *** 59 589 6 MO PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 222 222 222 887 275 10 MO PTMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 1,161 0 12 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 60 60 60 60 301 603 1 12 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 843 0 10 MO PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 458 915 2,288 12 MO. PYMTS. - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - ----------------------------------------------------------------------------------------------------------------------------------
Page 4 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.
- --------------------------------------------------------------------------------------------------------- CUSTOMER LIST BY REGION CONT # OUT- - --------------------------------------------------------------------------------------------------------- CUST NAME CUST # CONTRACT # CONT DATE BILL DATE ANN DATE CONT $ Per Hardcopy STANDING - --------------------------------------------------------------------------------------------------------- A *** 13486304 421117200 93-05-24 95-06-04 93-06-04 2,592 2,592 - 2,592 - --------------------------------------------------------------------------------------------------------- A *** 13683824 944440100 92-11-01 94-10-30 95-10-30 708 708 - 188 - --------------------------------------------------------------------------------------------------------- A *** 13734902 492409000 94-11-08 95-01-10 96-06-10 1,200 1,200 - 1,200 - --------------------------------------------------------------------------------------------------------- A *** 13694260 478875000 94-12-02 95-07-31 96-07-31 3,416 3,416 - 3,065 - --------------------------------------------------------------------------------------------------------- A *** 10055505 449455100 94-04-28 95-04-01 96-04-10 1,368 1,368 - 899 - --------------------------------------------------------------------------------------------------------- M *** 10067944 417647200 93-06-15 95-07-27 96-07-27 1,368 1,368 - 1,368 - --------------------------------------------------------------------------------------------------------- A *** 13724783 492723000 94-09-02 94-09-14 95-09-14 1,500 1,500 - 0 - --------------------------------------------------------------------------------------------------------- A *** 13715170 437434100 94-05-26 95-05-10 96-05-10 1,368 1,248 pi 1,180 - --------------------------------------------------------------------------------------------------------- A *** 10323679 944010101 94-08-23 94-10-31 95-10-31 945 945 - 97 - --------------------------------------------------------------------------------------------------------- A *** 13736597 464559000 94-12-15 95-01-09 96-01-09 3,600 3,600 - 0 - --------------------------------------------------------------------------------------------------------- A *** 13736597 493582000 94-12-15 95-01-18 96-01-18 8,400 8,400 - 0 - --------------------------------------------------------------------------------------------------------- A *** 13043806 464369000 94-10-24 94-11-01 95-11-01 1,500 1,500 - 500 - --------------------------------------------------------------------------------------------------------- A *** 13664210 491604100 93-10-01 95-02-10 96-02-10 5,400 3,600 5,234 - --------------------------------------------------------------------------------------------------------- A *** 13517824 469750100 94-04-01 95-05-01 96-05-01 775 708 - 0 - --------------------------------------------------------------------------------------------------------- A *** 13682650 500181000 94-06-27 94-11-01 95-11-01 4,392 4,392 - - --------------------------------------------------------------------------------------------------------- A *** 13717189 485047000 94-06-21 94-10-01 95-10-01 3,009 3,009 - 0 - --------------------------------------------------------------------------------------------------------- A *** 10081339 413457201 95-02-01 95-03-01 96-03-01 3,089 3,744 dg 0 - --------------------------------------------------------------------------------------------------------- A *** 13689439 944460101 94-08-09 94-10-30 95-10-30 900 900 - - --------------------------------------------------------------------------------------------------------- A *** 13042126 421662200 94-05-18 95-07-10 96-07-10 4,170 4,170 - 4,170 - --------------------------------------------------------------------------------------------------------- A *** 10305097 471254300 95-03-17 96-03-01 96-08-31 750 750 - 750 - --------------------------------------------------------------------------------------------------------- M *** 10305097 471254200 95-03-17 94-03-01 96-03-01 1,585 1,500 - 1,585 - --------------------------------------------------------------------------------------------------------- A *** 13184462 314324400 93-10-07 93-10-10 94-10-10 3,500 3,500 - 0 - --------------------------------------------------------------------------------------------------------- A *** 13749766 463906000 95-04-24 95-05-10 95-10-10 1,600 1,600 - 1,600 - --------------------------------------------------------------------------------------------------------- A *** 12901370 430371201 95-03-16 95-01-03 96-01-03 1,070 1,070 - - --------------------------------------------------------------------------------------------------------- A *** 13672004 401989101 93-12-03 94-12-10 95-12-10 708 708 - 220 - --------------------------------------------------------------------------------------------------------- A *** 14286178 448797200 93-04-28 95-05-10 96-05-10 1,368 972 ug - --------------------------------------------------------------------------------------------------------- A *** 13256686 469802101 94-09-20 94-10-01 95-10-01 3,575 3,575 - 0 - --------------------------------------------------------------------------------------------------------- A *** 17814158 418511201 94-12-05 95-01-01 96-01-01 3,033 3,033 - 917 - --------------------------------------------------------------------------------------------------------- A *** 13723043 497443100 94-08-08 95-02-10 96-02-10 1,992 1,162 ug 0 - --------------------------------------------------------------------------------------------------------- A *** 13114423 492092100 94-02-01 95-02-08 96-02-08 1,368 1,368 - 761 - --------------------------------------------------------------------------------------------------------- M *** 13114423 478719000 94-12-09 94-12-30 95-12-30 1,500 1,500 - - --------------------------------------------------------------------------------------------------------- M *** 13522846 368523300 92-09-18 94-09-10 95-09-10 708 708 - 0 - --------------------------------------------------------------------------------------------------------- A *** 13730153 467320000 95-06-05 95-06-05 96-06-05 1,500 1,500 - 1,240 - --------------------------------------------------------------------------------------------------------- M *** 13730153 493476000 94-10-26 94-11-04 95-11-04 750 750 - 155 - --------------------------------------------------------------------------------------------------------- A *** 13731570 492876000 94-10-28 94-11-17 95-11-17 1,500 1,500 - 305 - --------------------------------------------------------------------------------------------------------- A *** 10098171 497442001 94-07-15 94-08-09 95-08-09 553 553 - - --------------------------------------------------------------------------------------------------------- A *** 13684726 418867100 93-09-21 94-09-29 95-09-29 2,592 2,592 - 0 - --------------------------------------------------------------------------------------------------------- A *** 13677627 485389103 94-07-01 94-07-01 94-09-30 275 550 dg 138 - --------------------------------------------------------------------------------------------------------- A *** 13677627 485394102 94-07-01 94-07-01 94-09-30 138 550 dg 138 - --------------------------------------------------------------------------------------------------------- A *** 13753020 475456002 95-05-23 95-05-10 96-11-10 300 300 - 300 - --------------------------------------------------------------------------------------------------------- *** - --------------------------------------------------------------------------------------------------------- *** - --------------------------------------------------------------------------------------------------------- *** - --------------------------------------------------------------------------------------------------------- *** 196 336,639 330,691 138,288 - --------------------------------------------------------------------------------------------------------- *** - --------------------------------------------------------------------------------------------------------- *** - --------------------------------------------------------------------------------------------------------- *** - --------------------------------------------------------------------------------------------------------- W A *** 40001333 485936100 93-10-10 95-01-14 96-01-14 695 1,865 mp - --------------------------------------------------------------------------------------------------------- W A *** 40001333 485937100 93-10-10 95-01-14 96-01-14 695 695 - - --------------------------------------------------------------------------------------------------------- W A *** 40002291 432234200 93-01-08 95-01-08 96-01-08 695 1,815 mp - --------------------------------------------------------------------------------------------------------- W A *** 40002291 498712100 93-09-06 94-09-06 95-09-06 695 695 - - --------------------------------------------------------------------------------------------------------- W A *** 40000893 499099100 93-10-26 94-10-26 95-10-26 695 695 - - --------------------------------------------------------------------------------------------------------- W A *** 40000893 400990200 92-08-18 94-08-18 95-08-18 695 2,480 Can - --------------------------------------------------------------------------------------------------------- W A *** 40000893 400990201 92-08-18 94-08-14 95-08-14 695 895 mp - --------------------------------------------------------------------------------------------------------- W A *** 40002835 406266100 93-01-12 95-04-30 96-04-30 695 1,290 mp 695 - --------------------------------------------------------------------------------------------------------- W A *** 40002835 406266101 93-01-12 95-04-30 96-04-30 695 1,290 mp - --------------------------------------------------------------------------------------------------------- W M *** 40002835 406265100 93-01-12 95-04-30 96-04-30 695 M M - --------------------------------------------------------------------------------------------------------- W A *** 40002943 009215001 90-03-10 94-03-10 96-03-10 235 235 - - --------------------------------------------------------------------------------------------------------- W A *** 40003692 401019201 89-06-05 94-09-23 95-09-23 595 1,985 mp,dg - --------------------------------------------------------------------------------------------------------- W A *** 40012320 457429000 94-10-21 94-12-03 95-12-03 695 695 - 504 - --------------------------------------------------------------------------------------------------------- W A *** 40012320 494372000 94-10-21 94-12-03 95-12-03 695 1,290 mp 504 - --------------------------------------------------------------------------------------------------------- W A *** 40012320 457431000 94-10-21 94-12-03 95-12-03 695 1,290 mp 504 - --------------------------------------------------------------------------------------------------------- W A *** 40004071 064318300 92-02-19 94-06-10 98-09-10 695 1,390 mp 1,529 - --------------------------------------------------------------------------------------------------------- W A *** 40004347 406252000 92-09-18 94-12-12 95-12-12 695 2,955 - --------------------------------------------------------------------------------------------------------- W A *** 40004347 406253000 94-04-01 94-12-01 95-12-01 695 1,423 - ---------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------- CUR DAYS PAST DUE TOTAL - --------------------------------------------------------------------------------------------------------- CUST NAME DUE 30 60 90 120 150+ REC UNBILLED TERMS - --------------------------------------------------------------------------------------------------------- A *** 259 259 2,333 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 61 61 127 12 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 1,200 1,200 0 2 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 3,065 3,065 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 150 150 750 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- M *** 139 139 1,229 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 116 116 1,064 12 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 97 97 0 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 125 124 375 12 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 543 543 543 543 543 543 3,255 1,979 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 0 0 3 QTRLY PYMTS - --------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 0 0 12 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 454 454 3,716 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 0 750 PURCHASE ORDER - --------------------------------------------------------------------------------------------------------- M *** 790 790 795 PURCHASE ORDER - --------------------------------------------------------------------------------------------------------- A *** 0 0 PURCHASE ORDER - --------------------------------------------------------------------------------------------------------- A *** 1,600 1,600 0 PURCHASE ORDER - --------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 73 73 147 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 0 0 3 QTRLY PYMTS - --------------------------------------------------------------------------------------------------------- A *** 306 306 612 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 139 139 621 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- M *** 0 0 3 QTRLY PYMTS - --------------------------------------------------------------------------------------------------------- M *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 155 155 1,085 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- M *** 78 78 78 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 153 153 305 0 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- A *** 138 138 0 PURCH ORDER - --------------------------------------------------------------------------------------------------------- A *** 138 138 0 PURCH ORDER - --------------------------------------------------------------------------------------------------------- A *** 32 32 65 235 10 MO PYMTS - --------------------------------------------------------------------------------------------------------- *** - --------------------------------------------------------------------------------------------------------- *** - --------------------------------------------------------------------------------------------------------- *** - --------------------------------------------------------------------------------------------------------- *** 29,105 9,285 3,481 3,018 6,859 19,378 71,127 67,162 - --------------------------------------------------------------------------------------------------------- *** - --------------------------------------------------------------------------------------------------------- *** - --------------------------------------------------------------------------------------------------------- *** - ------------------------------------------------------------------------------------------ --------------- W A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 695 695 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W M *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 324 324 181 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 348 348 157 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 348 348 157 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 695 695 1,390 139 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 0 0 NET 30 - --------------------------------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ---------------------------------------------------------------------------------------------------------
For each agreement referred herein: A = assignable; N = non-assignable; M = unlocated. Page 5 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.
- --------------------------------------------------------------------------------------------------------------------------- CUSTOMER LIST BY REGION Cont $ OUT- Cur - --------------------------------------------------------------------------------------------------------------------------- CUST NAME CUST # CONTRACT # CONT DATE BILL DATE ANN DATE CONT $ Per Hardcopy STANDING Due - --------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------- W A *** 40004347 406254000 94-04-01 94-12-01 95-12-01 695 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40004927 406112100 93-08-10 94-11-22 95-11-22 695 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40004927 406267100 94-01-30 95-04-03 96-04-03 695 695 - 777 - --------------------------------------------------------------------------------------------------------------------------- W A *** 40004927 406231100 93-11-14 95-02-19 96-02-19 695 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40005760 499007100 93-06-22 94-09-29 95-09-29 695 1,340 mp - --------------------------------------------------------------------------------------------------------------------------- W A *** 40006006 412980200 93-01-12 95-04-19 96-04-19 695 695 - 752 695 - --------------------------------------------------------------------------------------------------------------------------- W M *** 40005984 376843300 93-04-22 95-04-02 96-04-02 1,390 M M 799 695 - --------------------------------------------------------------------------------------------------------------------------- W A *** 40006152 426296200 93-04-25 95-07-20 96-07-20 695 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40006196 494221100 94-03-19 95-05-20 96-05-20 695 1,553 mp - --------------------------------------------------------------------------------------------------------------------------- W A *** 40008334 063954201 91-09-27 94-09-30 95-09-30 595 2,520 mp - --------------------------------------------------------------------------------------------------------------------------- W A *** 40012054 400912200 92-08-15 94-08-15 95-08-15 695 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40009308 400929100 92-08-19 NO CHG NO CHG - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40009616 400396300 94-01-13 NO CHG 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40009627 006525000 89-08-02 NO CHG NO CHG - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40010216 485453100 93-10-10 95-01-13 96-01-13 695 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40010216 406271100 94-01-30 95-04-19 95-04-19 1,390 1,390 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40013110 429113100 93-04-06 94-06-12 95-06-12 595 595 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40014951 506251100 93-07-16 94-09-22 95-09-22 695 1,665 mp - --------------------------------------------------------------------------------------------------------------------------- W A *** 40015822 064739200 92-04-06 95-04-06 96-04-06 695 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40015952 542611400 93-06-21 94-09-08 95-09-08 595 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40008464 063919200 92-07-15 94-09-27 95-09-27 895 845 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40008497 406236000 94-06-13 94-06-13 95-06-13 895 870 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40009010 506255100 93-07-20 94-09-30 95-09-30 695 1,310 mp - --------------------------------------------------------------------------------------------------------------------------- W A *** 40012122 494234100 94-03-19 95-06-20 96-06-20 752 1,340 mp 752 752 - --------------------------------------------------------------------------------------------------------------------------- W A *** 40012100 494233100 94-03-19 NO CHG NO CHG - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40012627 489279000 90-01-10 95-01-10 96-01-10 495 470 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40012627 489280100 93-12-22 94-12-22 95-12-22 695 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40013279 506543100 94-03-08 95-03-09 96-03-09 695 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40003997 063499200 91-08-10 94-08-10 95-08-10 644 1,490 mp 644 644 - --------------------------------------------------------------------------------------------------------------------------- W A *** 40013363 062699200 90-06-14 94-09-27 95-09-27 595 795 - --------------------------------------------------------------------------------------------------------------------------- W A *** 40001674 412997200 93-01-13 95-04-14 96-04-14 695 920 mp - --------------------------------------------------------------------------------------------------------------------------- W A *** 40001979 506202100 92-09-15 94-10-31 95-10-31 695 1,291 mp - --------------------------------------------------------------------------------------------------------------------------- W A *** 40002097 413081200 87-03-26 95-03-24 96-03-24 695 495 ug - --------------------------------------------------------------------------------------------------------------------------- W M *** 40002729 062768301 94-04-01 94-11-01 95-11-01 695 M M - --------------------------------------------------------------------------------------------------------------------------- W A *** 40014412 400336200 92-05-10 95-05-10 96-05-10 695 3,005 mp 723 - --------------------------------------------------------------------------------------------------------------------------- W M *** 40019112 447177200 93-04-22 95-04-22 96-04-22 1,790 M M 2,047 - --------------------------------------------------------------------------------------------------------------------------- W A *** 40010607 063469200 91-11-20 94-12-04 95-12-04 595 595 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40009764 400530000 90-09-03 94-12-16 95-12-16 595 695 - - --------------------------------------------------------------------------------------------------------------------------- W A *** 40009764 061775200 92-09-15 94-09-12 95-09-12 695 1,140 mp 325 - --------------------------------------------------------------------------------------------------------------------------- W A *** 40016614 376435300 92-06-08 95-06-08 96-06-08 1,390 1,390 - 777 - --------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------- 46 39,756 57,732 11,333 5,195 - --------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------- 448,545 538,448 176,196 37,618 - --------------------------------------------------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- DAYS PAST DUE TOTAL - ------------------------------------------------------------------------------- CUST NAME 30 60 90 120 150+ REC UNBILLED TERMS - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 695 695 82 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 695 57 NET 30 - ------------------------------------------------------------------------------- W M *** 695 104 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 LIEU/ADVERTISE - ------------------------------------------------------------------------------- W A *** 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 752 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 644 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W M *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 723 NET 30 - ------------------------------------------------------------------------------- W M *** 695 895 1,590 457 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 0 NET 30 - ------------------------------------------------------------------------------- W A *** 0 325 NET 30 - ------------------------------------------------------------------------------- W A *** 0 777 NET 30 - ------------------------------------------------------------------------------- 0 1,390 0 895 695 8,175 3,158 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 11,099 6,901 3,174 7,941 21,912 88,345 87,850 - -------------------------------------------------------------------------------
For each agreement referred herein: A = assignable; N = non-assignable; M = unlocated. Page 6 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. EXHIBIT G --------- TRW REDI SUBSCRIPTION AGREEMENT
[LOGO] TRW REDI PROPERTY DATA Unless otherwise stipulated and agreed to herein, this is an 1700 N.W. 66th Avenue, Ft. Lauderdale, FL 33313 ANNUAL (12-MONTH) LEASE AGREEMENT for TRW REDI products and/or 1-800-345-7334 services, as specified below, relating to.... EXHIBIT G - ------------------------------------------------------------------------------------------------------------------------------------ This is an [_] ORIGINAL-LEASE AGREEMENT [_] ADDENDUM (Continuation and/or Revision) Revision) PRODUCTS COUNTY NAME COUNTY STATE EDITION - ------------------------------------------------------------------------------------------------------------------------------------ LESSEE CUSTOMER (BILLING) ADDRESS IS LOCATED IN [_] Same county as shown above [_] Other COUNTY NUMBER NAME OR TRADEMARK OF CUSTOMER - ------------------------------------------------------------------------------------------------------------------------------------ REP: IF CUSTOMERS NAME OR BILLING ADDRESS HAS CHANGED SINCE LAST COUNTY NAME STATE AGREEMENT SEE INSTRUCTIONS ON REVERSE SIDE. - ------------------------------------------------------------------------------------------------------------------------------------ BILLING / CORRESPONDENCE SHIP TO & PICK UP FROM ADDRESS ADDRESS/IF SAME LEAVE BLANK - ----------------------------------------------------------------------- -------------------------------------------------------- Street Address Department Room Number Street Address Department Room Number Ship Code - ----------------------------------------------------------------------- -------------------------------------------------------- City State City State - ----------------------------------------------------------------------- -------------------------------------------------------- Zip Code Area Code Telephone Zip Code Area Code Telephone - ----------------------------------------------------------------------- -------------------------------------------------------- Attention Of Department Attention Of Department - ----------------------------------------------------------------------- -------------------------------------------------------- PLEASE SUPPLY STREET ADDRESS, WE CANNOT SHIP TO A POST OFFICE BOX - ------------------------------------------------------------------------------------------------------------------------------------ CHECK PRODUCTS and/or SERVICES ORDERED.... APPLICABLE TO THE ABOVE NAMED COUNTY OR THIS AGREEMENT ONLY - ------------------------------------------------------------------------------------------------------------------------------------ [X] Deliver IF THIS ORDER IS FOR # OF PRODUCT COMPONENTS ----------- LESS THAN FULL COUNTY SETS and/or SERVICES No Yes give "SPLIT" specifics. ORDERED Has (if more Already than 1) - ------------------------------------------------------------------------------------------------------------------------------------ Microfiche: OWNERSHIP BY ASSESSOR # (NUMERICAL) - ------------------------------------------------------------------------------------------------------------------------------------ Microfiche: OWNERSHIP BY NAME (ALPHABETICAL) - ------------------------------------------------------------------------------------------------------------------------------------ Microfiche: OWNERSHIP BY ADDRESS - ------------------------------------------------------------------------------------------------------------------------------------ Microfiche: OWNERSHIP BY CATEGORY (INVEST. PACKAGE) - ------------------------------------------------------------------------------------------------------------------------------------ Microfiche: ASSESSOR MAPS - ------------------------------------------------------------------------------------------------------------------------------------ "REALTY DIRECTORY" (OWNERSHIP) - ------------------------------------------------------------------------------------------------------------------------------------ "AERIAL & MARSEES ATLAS" - ------------------------------------------------------------------------------------------------------------------------------------ RECORDED PLATS LIBRARY - ------------------------------------------------------------------------------------------------------------------------------------ RECORDED PLATS UPDATE SERVICE - ------------------------------------------------------------------------------------------------------------------------------------ SALES TRANSACTIONS/OWNERSHIP UPDATES - ------------------------------------------------------------------------------------------------------------------------------------ OTHER: - ------------------------------------------------------------------------------------------------------------------------------------ OTHER: - ------------------------------------------------------------------------------------------------------------------------------------ SERIAL NUMBER MICROFICHE READER (VIEWER) (If Known) - ------------------------------------------------------------------------------------------------------------------------------------ Annual Membership / Access Fee: NATIONAL DATA RESEARCH CENTER (DRC) - ------------------------------------------------------------------------------------------------------------------------------------ * Check which report REDI REDI WEEKLY and circle frequency REALTY C I & L --------------------------- MONTHLY [_] REPORT [_] REPORT [_] OTHER TITLE QUARTERLY - ------------------------------------------------------------------------------------------------------------------------------------ ========================= ===================== CUSTOMER ACCOUNT NUMBER THIS AGREEMENT NUMBER - ------------------------- --------------------- [1][_][_][_][_][_][_] [0][4][6][6][5][0] REP: If this is an ADDENDUM the number above MUST be crossed out (on all copies). ========================= ===================== ORIGINAL LEASE NUMBER BILLING ONLY - ------------------------- --------------------- [_][_][_][_][_][_][_] - [_][_][_] ========================= ====================== FIELD REPRESENTATIVE SUPPORT REPRESENTATIVE - ------------------------- ---------------------- - ------------------------- ---------------------- Name Number Name Number - ------------------------- ---------------------- ========================= ===================== LEASE TYPE ADDENDUM TYPE NEW ACCOUNT CONTINUANCE AS IS - ------------------------- --------------------- REP: Check here if [_] Continuance downgrade this is a former customer - ------------------------- --------------------- [_] New Existing Account [_] Add-on [_] Superceding Lease* [_] Superceding* - ------------------------- --------------------- ==================================================== REP: If this is a super- ceding lease, enter here the number of the lease it is replacing - ----------------------------------------------------- [_] UPON DELIVERY OF PRODUCTS ORDERED HEREIN, ON THE MONTH OF _______________________________ 199 ___ ========================= ===================== DATE OF THIS AGREEMENT LEAD SOURCE CODE - ------------------------- --------------------- [_][_] [_][_] [9][_] [_][_][_][_] - ------------------------- --------------------- Month Day Year - ----------------------------------------------------- ========================================================================================================== ANNUAL LEASE AMOUNT - ---------------------------------------------------------------------------------------------------------- Lease amount or 12 months $_______________ Extended Term Lease $_______________ (2nd Year) Add on _______________ (Less Credits if any) (_______________) Extended Term Lease $_______________ (3rd Year) SUB-TOTAL $_______________ SALES USE TAX: _______________ TOTAL PAYABLE + $_______________ TOTAL PAYABLE FOR LEASE TERMS ELECTED: $_______________ SHIPPING/HANDLING $ 25.00 (Plus applicable excess charges) --------------- REP: If this is a "Special Rush" order via UPS 2-day service or Federal Express, change shipping charge above to $50.00. ========================================================================================================== ============================================================================================================== PAYMENT TERMS FOR THE LEASSEE - -------------------------------------------------------------------------------------------------------------- A finance charge equal to the lesser of (a) 1.5% or The undersigned hereby affirms that he/she is duly (b) the maximum rate permitted by law, will be authorized to commit the lessee to all Terms and added to any unpaid balance hereon. Conditions set forth in this agreement...including any "Extended Term" elected herein. ( ) PAID IN FULL ( ) PAYABLE NET 30 DAYS -------------------------------------------------- ( ) PURCHASE ORDER Authorizer's Name (Please Print) PO # ________________________ OTHER (Rep Explain): -------------------------------------------------- Authorizer's Title X -------------------------------------------------- Authorizer's Signature $__________ Check Attached ( ) CREDIT CARD Customer's Business Category Code: [_][_] HQ USE ONLY (See Other Side) TERM CODE [_][_] - --------------------------------------------------------------------------------------------------------------
28
[LOGO] TRW REDI PROPERTY DATA Unless otherwise stipulated and agreed to herein, this is an 1700 N.W. 66th Avenue, Ft. Lauderdale, FL 33313 ANNUAL (12-MONTH) LEASE AGREEMENT for TRW REDI products and/or 1-800-345-7334 services, as specified below, relating to.... EXHIBIT G - ------------------------------------------------------------------------------------------------------------------------------------ This is an [_] ORIGINAL-LEASE AGREEMENT [_] ADDENDUM (Continuation and/or Revision) Revision) PRODUCTS COUNTY NAME COUNTY STATE EDITION - ------------------------------------------------------------------------------------------------------------------------------------ LESSEE CUSTOMER (BILLING) ADDRESS IS LOCATED IN [_] Same county as shown above [_] Other COUNTY NUMBER NAME OR TRADEMARK OF CUSTOMER - ------------------------------------------------------------------------------------------------------------------------------------ REP: IF CUSTOMERS NAME OR BILLING ADDRESS HAS CHANGED SINCE LAST COUNTY NAME STATE AGREEMENT SEE INSTRUCTIONS ON REVERSE SIDE. - ------------------------------------------------------------------------------------------------------------------------------------ BILLING / CORRESPONDENCE SHIP TO & PICK UP FROM ADDRESS ADDRESS/IF SAME LEAVE BLANK - ----------------------------------------------------------------------- -------------------------------------------------------- Street Address Department Room Number Street Address Department Room Number Ship Code - ----------------------------------------------------------------------- -------------------------------------------------------- City State City State - ----------------------------------------------------------------------- -------------------------------------------------------- Zip Code Area Code Telephone Zip Code Area Code Telephone - ----------------------------------------------------------------------- -------------------------------------------------------- Attention Of Department Attention Of Department - ----------------------------------------------------------------------- -------------------------------------------------------- PLEASE SUPPLY STREET ADDRESS, WE CANNOT SHIP TO A POST OFFICE BOX - ------------------------------------------------------------------------------------------------------------------------------------ CHECK PRODUCTS and/or SERVICES ORDERED.... APPLICABLE TO THE ABOVE NAMED COUNTY OR THIS AGREEMENT ONLY - ------------------------------------------------------------------------------------------------------------------------------------ [X] Deliver IF THIS ORDER IS FOR # OF PRODUCT COMPONENTS ----------- LESS THAN FULL COUNTY SETS and/or SERVICES No Yes give "SPLIT" specifics. ORDERED Has (if more Already than 1) - ------------------------------------------------------------------------------------------------------------------------------------ Microfiche: OWNERSHIP BY ASSESSOR # (NUMERICAL) - ------------------------------------------------------------------------------------------------------------------------------------ Microfiche: OWNERSHIP BY NAME (ALPHABETICAL) - ------------------------------------------------------------------------------------------------------------------------------------ Microfiche: OWNERSHIP BY ADDRESS - ------------------------------------------------------------------------------------------------------------------------------------ Microfiche: OWNERSHIP BY CATEGORY (INVEST. PACKAGE) - ------------------------------------------------------------------------------------------------------------------------------------ ASSESSOR MAPS - ------------------------------------------------------------------------------------------------------------------------------------ "REALTY DIRECTORY" (OWNERSHIP) - ------------------------------------------------------------------------------------------------------------------------------------ "AERIAL & MARSEES ATLAS" - ------------------------------------------------------------------------------------------------------------------------------------ RECORDED PLATS LIBRARY - ------------------------------------------------------------------------------------------------------------------------------------ RECORDED PLATS UPDATE SERVICE - ------------------------------------------------------------------------------------------------------------------------------------ SALES TRANSACTIONS/OWNERSHIP UPDATES - ------------------------------------------------------------------------------------------------------------------------------------ OTHER: - ------------------------------------------------------------------------------------------------------------------------------------ OTHER: - ------------------------------------------------------------------------------------------------------------------------------------ SERIAL NUMBER MICROFICHE READER (VIEWER) (If Known) - ------------------------------------------------------------------------------------------------------------------------------------ Annual Membership / Access Fee: NATIONAL DATA RESEARCH CENTER (DRC) - ------------------------------------------------------------------------------------------------------------------------------------ * Check which report REDI REDI WEEKLY and circle frequency REALTY C 1 & L --------------------------- MONTHLY [_] REPORT [_] REPORT [_] OTHER TITLE QUARTERLY - ------------------------------------------------------------------------------------------------------------------------------------ ========================= ===================== ???????????????????? THIS AGREEMENT NUMBER - ------------------------- --------------------- [1][_][_][_][_][_][_] [0][4][6][6][5][0] REP: If this is an ADDENDUM the number above MUST be crossed out (on all copies). ========================= ===================== ORIGINAL LEASE NUMBER BILLING ONLY - ------------------------- --------------------- [_][_][_][_][_][_][_] - [_][_][_] [illegible copy] ========================= ===================== LEASE TYPE ADDENDUM TYPE NEW ACCOUNT CONTINUANCE AS IS - ------------------------- --------------------- REP: Check here if [_] Continuance downgrade this is a former customer - ------------------------- --------------------- [_] New Existing Account [_] Add-on [_] Superceding Lease* [_] Superceding* - ------------------------- --------------------- ==================================================== REP: If this is a super- ceding lease, enter here the number of the lease it is replacing - ----------------------------------------------------- [_] UPON DELIVERY OF PRODUCTS ORDERED HEREIN, ON THE MONTH OF _______________________________ 199 ___ ========================= ===================== DATE OF THIS AGREEMENT LEAD SOURCE CODE - ------------------------- --------------------- [_][_] [_][_] [9][_] [_][_][_][_] - ------------------------- --------------------- Month Day Year - ----------------------------------------------------- ========================================================================================================== ANNUAL LEASE AMOUNT - ---------------------------------------------------------------------------------------------------------- Lease amount or 12 months $_______________ Extended Term Lease $_______________ (2nd Year) Add on _______________ (Less Credits if any) (_______________) Extended Term Lease $_______________ (3rd Year) SUB-TOTAL $_______________ SALES USE TAX: _______________ TOTAL PAYABLE + $_______________ TOTAL PAYABLE FOR LEASE TERMS ELECTED: $_______________ SHIPPING/HANDLING $ 25.00 (Plus ?????? excess charges) --------------- ========================================================================================================== ============================================================================================================== PAYMENT TERMS FOR THE LEASSEE - -------------------------------------------------------------------------------------------------------------- A finance charge equal to the lesser of (a) 1.5% or The undersigned hereby affirms that he/she is duly (b) the maximum rate permitted by law, will be authorized to commit the lessee to all Terms and added to any unpaid balance hereon. Conditions set forth in this agreement...including any "Extended Term" elected herein. ( ) PAID IN FULL ( ) PAYABLE NET 30 DAYS -------------------------------------------------- ( ) PURCHASE ORDER Authorizer's Name (Please Print) PO # ________________________ OTHER (Rep Explain): -------------------------------------------------- Authorizer's Title X -------------------------------------------------- Authorizer's Signature $__________ Check Attached ( ) CREDIT CARD Customer's Business Category Code: [_][_] MO USE ONLY (See Other Side) TERM CODE [_][_] - --------------------------------------------------------------------------------------------------------------
TRW REDI Property Data [LOGO] CD ROM Subscription Agreement TRW-REDI ================================================================================================================================== Date of Agreement Field Representative Number/Name Customer Account Number [_][_] [_][_] [_][_] [_][_][_]_________________________________________________ [_][_] - [_][_][_][_][_][_] Month Day Year [_][_][_]_________________________________________________ ================================================================================================================================== Subject to the terms and conditions of this agreement, TRW REDI ============================================================= Property Data ("Licensor") grants to Licensee, identified below LICENSED AREAS # COPIES N/R $ ADD ON ANNUAL PRICE and Licensee accepts a limited non-exclusive, non-transferable ------------------------------------------------------------- license without right of sub-license, to use the information published by the Licensor on CD-ROM disk(s) listed herein (the ------------------------------------------------------------- "Information"), and a limited, non-exclusive, non-transferable license, without the right of sub-license, to use the Retrieval ------------------------------------------------------------- Software only for the purposes of retrieving the information from CD-ROM disk(s) at the Licensee's location, solely during the term ------------------------------------------------------------- and in concordance with the terms, conditions, and restrictions of this agreement. ------------------------------------------------------------- TERMS AND CONDITIONS. ------------------------------------------------------------- 1. ACCOUNT ESTABLISHMENT FEE: The Licensee shall pay TRW REDI a one-time, non-refundable account establishment fee. ------------------------------------------------------------- 2. PRODUCT SHIPPING COSTS: The Licensee shall pay TRW REDI recurring product shipping fees. ------------------------------------------------------------- 3. PRODUCT DEFINITION: The information, the CD disks containing the information, the retrieval software, and the security ------------------------------------------------------------- system together constitute "The Product." 4. PAYMENT TERMS: ------------------------------------------------------------- [____________] equal payment payable [____________] 5. TERM: ------------------------------------------------------------- The initial term of this agreement shall be for [_________] months, commencing [___________] through [____________] ------------------------------------------------------------- and is non-cancelable during that period; however, the Licensor Sub Total: may terminate the licenses granted herein at any time without Product Shipping Fee: notice if the Licensee breaches this agreement. This agreement Sales/Use Tax: will renew automatically for successive twelve month periods TOTAL $: unless canceled by either party in writing not less than thirty ------------------------------------------------------------- (30) days prior to the expiration of any term. Monthly Payment $: 6. ACCEPTANCE: This agreement shall be deemed accepted by the ------------------------------------------------------------- Licensor upon issuance of the Product to the Licensee. 7. ENTIRE UNDERSTANDING: This agreement (constituting this page THE FOLLOWING ITEMS ARE PAYABLE IN ADVANCE: and the additional terms and conditions on the reverse hereto, sets forth the entire understanding between the Licensor and ------------------------------------------------------------- the Licensee and supersedes all prior agreements, memoranda, First Service Month: arrangements, and understandings relating to the subject Account Establishment Fee: matter hereof and may only be amended subsequent written PAYABLE WITH THIS AGREEMENT $: agreement of the parties hereto. ------------------------------------------------------------- ================================================================================================================================== SUBSCRIBER'S ACCEPTANCE Account Name:____________________________________________________________________________ Telephone Number:_________________ [_] Individual [_] Partnership [_] Corporation [_] dba Address:_________________________________________________________________________________ City, State, Zip Code:___________________________________________________________________ Authorized Signature:____________________________________________________________________ Date:_____________________________ Print Name:______________________________________________________________________________ Title:____________________________ ================================================================================================================================== TRW REDI Property Data . 3610 Central Avenue . Riverside California 92506 . (800) 345-7334
ON-LINE SUBSCRIPTION TRW REDI Agreement PROPERTY DATA [LOGO] TRW-REDI ==================================================================================================================================== Date Account Representative Existing TRW REDI Account Number - ----------------------------------------------- --------------------------------------------- -------------------------------- . ACCOUNT ESTABLISHMENT FEE The Subscriber shall pay TRW RED Property Data (hereinafter referred to as "TRW REDI") a one-time Account Establishment Fee in the amount of $________. The Subscriber may cancel Application for service and receive a full refund of the Establishment Fee for any reason up to three (3) business days after the initial date of application. After the three (3) days cancellation period has expired, TRW REDI will not refund the Account Establishment Fee for any reason. A reinstatement fee of $150 will be charged for all accounts which have been cancelled for ninety (90) days or more. . CONTRACT TERMS AND RATES (Select one and initial) ______ A) STANDARD ANNUAL TERM WITH REDUCED WEEKEND RATES Initial The term of this agreement shall be twelve (12) months effective ______/_____/______ and will automatically renew for successive twelve (12) month periods unless cancelled by either party in writing not less than thirty (30) days prior to the expiration of any term. The Subscriber will be billed a monthly minimum of $_______. The combined usage from all databases and usernames is applied to the total monthly minimum charge. Reduced weekend rates of __________ cents per minute for 300/1200 baud access and ______ cents per minute for 2400 baud access for usage on the Real Property File only between the hours of 7:00 PM Friday and 7:00 A.M. Monday, Local Time. Reduced weekend rates will be effective only after the monthly minimum has been met at the standard rates. Billing for any usage prior to the above effective date will be calculated at the per minute rate noted herein. _____ B) ANNUAL FIXED FEE Initial The initial term of this agreement shall be twelve (12) months, effective _____/______/___, and will automatically renew for successive twelve (12) month periods unless cancelled by either party in writing not less than thirty (30) days prior to the expiration of any term. FIXED MONTHLY FEE OPTIONS (Select and initial one:) 1) 300/1200 Baud Option ____ (Initial and date here) The Subscriber will be billed a fixed monthly fee of $_______ for access to the Real Property File at 300 or 1200 baud, providing the Subscriber up to _____ minutes (____ hours) of usage per month. Each minute of usage (at 300 or 1200 baud) which exceeds the monthly time allotment will be billed at the rate of _____ cents per minute, in the event the Subscriber elects to access the On-Line Service at 2400 baud, the fixed monthly fee will remain the same, however. the per minute charge will be billed at the rate of ______ cents per minute, thereby reducing the amount of time provided at the 300/1200 baud fixed monthly fee. 2) 2400 Baud Option ____ (Initial and date here) The Subscriber will be billed a fixed monthly fee of $______ for access to the Real Property File at 300, 1200 or 2400 baud, providing the Subscriber up to ____ minutes (____ hours) of usage per month. Each minute of usage which exceeds the monthly time allotment, will be billed at the rate of _____ cents per minute. Usage on all other databases will be accumulated separately from the Real Property File. The Subscriber will be billed for usage on all other databases at the standard rates according to the On-Line Price List, dated _______, __. Billing for any usage prior to the above effective date will be calculated at the per minute rate noted herein. _____ C) OTHER _________________________________________ Initial The Subscriber shall be billed a monthly minimum charge of $______. The combined usage from all databases and usernames is applied to the total monthly minimum charge. This agreement shall remain in full force and effect until terminated by either party upon thirty (30) days advance, written notice to the other party. For the month in which termination becomes effective, the Subscriber will pay TRW REDI the actual accrued charges or the full monthly minimum charge, whichever is greater. Billing for any usage prior to the above effective date will be calculated at the per minute rate noted herein. _____ D) PREPAID ANNUAL WITH NO MONTHLY MINIMUM Initial The term of this agreement shall be twelve (12) months effective _____/_____/____. Subscriber shall pay TRW RED the sum of $_______ to be applied to the Subscriber's account as a prepaid, non- refundable, annual minimum fee. The charges for actual usage shall be deducted from this credit balance on a monthly basis. In the event that the prepaid balance is depleted prior to the expiration of this agreement, the Subscriber shall be billed for accumulated monthly usage per the payment terms set forth on the reverse side hereof for the remainder of the annual term. Billing for any usage prior to the above effective date will be calculated at the per minute rate noted herein. . ON-LINE DATABASE ACCESS AND RATES (FOR APPLICABLE FEES, REFER TO THE "ON-LINE PRICE LIST," DATED ___________) All Subscribers will be given access to the Real Property File for their "local" region. Subscriber also requests access to additional databases specified below: _____________________________________ _____________________________________ ____________________________________ _____________________________________ _____________________________________ ____________________________________ _____________________________________ _____________________________________ ____________________________________ The undersigned Subscriber understands the uses and limitations of the On-Line Service and databases with regard to the available data items. Further, the Subscriber accepts and acknowledges the terms and conditions set form on the reverse side hereof. ====================================================================================================================================
SUBSCRIBER'S ACCEPTANCE (Including required Subscriber's initials, where noted above) Account Name:____________________________________________________________________________ Telephone Number:_________________ [_] Individual [_] Partnership [_] Corporation [_] dba Address:_________________________________________________________________________________ City, State, Zip Code:___________________________________________________________________ Authorized Signature:____________________________________________________________________ Date:_____________________________ Print Name:______________________________________________________________________________ Title:____________________________ ==================================================================================================================================
EXHIBIT H --------- FORM OF PROMISSORY NOTE 29 PROMISSORY NOTE $750,000 San Diego, California As of August 31, 1995 1. OBLIGATION. COMPS InfoSystems, Inc., a Delaware corporation ---------- ("Maker"), for value received, hereby promises to pay to TRW REDI Property Data, (together with any successors and assigns, "Holder"), or order, at 5601 East La Palma Avenue, Anaheim, California 92807, or at such other place as holder may specify, the principal amount of Seven Hundred Fifty Thousand Dollars ($750,000). 2. INTEREST RATE. Beginning on the fourth anniversary date, ------------- December 1, 1999, any unpaid principal balance shall begin bearing interest at a fixed rate per annum of Eight Percent (8%). Prior to December 1, 1999, this note shall not be interest bearing. 3. PAYMENT SCHEDULE. Payment of principal shall be made according ---------------- to the Schedule attached hereto as Schedule A. Whenever any payment to be made ---------- under this Note is stated to be due on a Saturday, Sunday or a public or bank holiday or the equivalent for banks generally under the laws of the State of California (any other day being a "Business Day"), such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of the payment of interest. 4. PREPAYMENTS; APPLICATION. This Note may be prepaid in whole or ------------------------ in part at anytime without penalty or premium. Any principal prepayment shall be accompanied by a payment of the interest which has accrued on the amount prepaid. All prepayments of principal shall be applied to principal installments in the inverse order of their maturity (that is, against the last principal installment first). Payments received with respect to this Note shall be applied first to any fees and expenses then owing, second to unpaid accrued interest, and lastly to unpaid principal. 5. EVENTS OF DEFAULT. The occurrence of any of the following shall ----------------- constitute an "Event of Default" under this Note: (a) Maker shall fail to pay any principal, interest or other amounts payable under this Note within ten (10) days after such principal, interest or other amount shall be due and payable; or (b) Maker shall suffer or consent to or apply for the appointment of a receiver, trustee, custodian or liquidator of any substantial portion of its property, or shall make a general assignment for the benefit of creditors; Maker shall file a voluntary petition in bankruptcy, or seeking reorganization, in order to effect a plan or other arrangement with creditors or any other relief under the Bankruptcy Reform Act, Title 11 of the United States Bankruptcy Code, as amended or recodified from time to time ("Bankruptcy Code"), or under any state or federal law granting relief to debtors, whether now or hereafter in effect; or any involuntary petition or proceeding pursuant to the Bankruptcy Code or any other applicable state or federal law relating to bankruptcy, reorganization or other relief for debtors is filed or commenced against Maker, and such involuntary petition or proceeding is not dismissed within sixty days of its filing or commencement; or Maker shall file an answer admitting the jurisdiction of such a court and the 1 material allegations of any involuntary petition; or Maker shall be adjudicated a bankrupt, or an order for relief shall be entered by any court of competent jurisdiction under the Bankruptcy Code or any other applicable state or federal law relating to bankruptcy, reorganization or other relief for debtors; or (c) Maker shall become insolvent or become unable to fulfill its financial obligations as they mature. 6. MAXIMUM RATE. All agreements which either are now or which shall ------------ become agreements between Maker and the holder of this Note are hereby expressly limited so that in no contingency or event whatever, whether by reason of deferment of advancement of the indebtedness represented by this Note, or otherwise, shall the amount paid or agreed to be paid to the holder of this Note for the use, forbearance or detention of the indebtedness evidenced hereby exceed the maximum amount of interest permissible under applicable law. If, from any circumstance whatsoever, fulfillment of any provision hereof or of any other agreement between Maker and the holder hereof, at the time performance of such provision shall be due, shall involve exceeding the maximum limit as prescribed by law, then, ipso facto, the obligation to be fulfilled shall be reduced so as not to exceed said limit. 7. COMPLIANCE WITH PURCHASE AGREEMENT. Notwithstanding the above, ---------------------------------- Maker's performance under this Promissory Note is subject to and conditioned upon Holder's full compliance with the terms of that certain Purchase Agreement between Maker and Holder executed as of the date hereof (the "Purchase Agreement"), and Maker shall be entitled as a defense to any proceeding to enforce this Promissory Note to advance any defenses available to Maker pursuant to the Purchase Agreement. 8. WAIVER. Presentment, demand, protest, notices of protest, ------ dishonor and non-payment of this Note and all notices of every kind are hereby waived, except notices required by this Note. No single or partial exercise of, or forbearance from exercising, any power hereunder or under any guaranty pertaining to this Note shall preclude other or further exercises thereof or the exercise of any other power. 9. GOVERNING LAW. Principal and interest are payable in lawful ------------- money of the United States. This Note has been executed and delivered by Maker in the State of California and shall be governed by and construed in accordance with the laws of the State of California, without giving effect to any choice of law or conflict of law provisions (whether of the State of California or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of California. Maker: COMPS InfoSystems, Inc., a Delaware corporation By: /s/ Christopher Crane ------------------------------------ Christopher Crane, President 2 EXHIBIT A --------- REPAYMENT SCHEDULE ------------------
Date Amount Due ---- ---------- December 1, 1996 $125,000 December 1, 1997 $125,000 December 1, 1998 $125,000 December 1, 1999 $125,000 December 1, 2000 $125,000 + accrued interest December 1, 2001 $125,000 + accrued interest
3 EXHIBIT I --------- NONDISCLOSURE AGREEMENT [To be Completed] 30 EXHIBIT I CONFIDENTIAL DISCLOSURE AGREEMENT --------------------------------- This AGREEMENT is made and entered into on August 7, 1995 (the "Effective Date"), by and between COMPS, Inc. having a principal place of business at San Diego, California ("RECIPIENT") and TRW REDI Property Data ("TRW REDI"). WHEREAS, TRW REDI desires to disclose to RECIPIENT Proprietary Information (as defined below) relating to its Commercial and Industrial Property Data Publishing business for the purpose of RECIPIENT conducting due diligence for a sale of assets by TRW REDI to RECIPIENT (the "Purpose"). TRW REDI and RECIPIENT agree as follows: 1. For the purposes of this Agreement, "Proprietary Information" means all information originated by or otherwise peculiarly within the knowledge of TRW REDI and those in privity with TRW REDI and which TRW REDI protects against unrestricted disclosure to others. 2. In consideration of TRW REDI disclosing Proprietary Information to RECIPIENT, RECIPIENT shall hold all Proprietary Information in trust and confidence, shall use same only for the Purpose, and shall not disclose Proprietary Information to persons outside RECIPIENT or to any of its employees not directly concerned with furthering the Purpose. 3. RECIPIENT shall have no obligation with respect to any Proprietary Information (a) after the same is published or becomes generally available through no act or failure to act on the part of Recipient, (b) after the same is received by RECIPIENT from a third party having no obligation to TRW REDI with respect thereto, or (c) is independently developed by RECIPIENT. 4. No specific item of Proprietary Information shall be deemed to be within any one of the foregoing exceptions merely because such item is embraced by more general information that is within such exception. 5. Prior to disclosure of Proprietary Information to any employee, RECIPIENT shall fully advise such employee that he or she is required to hold in confidence all information and that such information is not to be disclosed to persons outside his or her organization nor to any co-employee not directly concerned with furthering the Purposes. RECIPIENT shall maintain between itself and its officers, employees and consultants duly binding agreements by such persons as may be necessary to fulfill the confidence obligations of RECIPIENT under this Agreement. RECIPIENT shall not disclose Proprietary Information to consultants without the prior written approval of TRW REDI. 6. This Agreement may be terminated at any time by either party giving thirty (30) days prior written notice to the other party. Unless earlier terminated, this Agreement shall expire one (1) year from the Effective Date. The RECIPIENT'S obligation to protect Proprietary Information shall survive any such termination for a period of two (2) years. 7. No rights or obligations other than those expressly recited herein are to be implied from this Agreement. 8. All documents, drawings and writings disclosing Proprietary Information to RECIPIENT and all copies thereof shall be returned promptly by RECIPIENT to TRW REDI upon TRW REDI'S request. 9. This Agreement merges all prior discussions and is the entire understanding and agreement of the parties relating to the protection of Proprietary Information; neither party shall be bound by any additional or other representation, condition, or promise except as subsequently set forth in a writing signed by the party to be bound. 10. The validity and interpretation of this Agreement shall be governed by the laws of the State of California, U.S.A., applicable to agreements made and to be performed wholly within such jurisdiction. TRW REDI By: /s/ Illegible --------------------------------- Title: V.P. Sales ------------------------------ RECIPIENT By: /s/ Christopher A. Crane --------------------------------- Title: Pres. ------------------------------ [LOGO] TRW REDI Property Data 5601 E. La Palma Avenue Anaheim, CA 92807 714 701-2100 August 31, 1995 COMPS Infosystems, Inc. 9888 Carroll Centre Road, Suite 100 San Diego, California 92126 Dear Mr. Crane: This letter sets forth certain agreements relating to the transactions provided for in that certain Purchase Agreement dated as of August 31, 1995, between COMPS Infosystems, Inc., and TRW REDI Property Data (the "Agreement"). In addition to the terms and conditions in the agreement and in consideration thereof parties agree as follows: . TRW REDI shall use reasonable efforts to incorporate a field for the "COMPS Number" in its on-line output format with respect to full-detail and six- line reports as soon as practicable; and . TRW REDI acknowledges that specifications substantially in the form attached hereto as Exhibit 1 are "reasonably acceptable" for purposes of --------- section 3.1 of the agreement. Except as set forth in this letter, the Agreement remains unmodified. Accepted: /s/ Edwin P. Setzer ---------------------------- Edwin P. Setzer, President TRW REDI Property Data Agreed: /s/ Christopher Crane - ----------------------------- Christopher Crane, President COMPS lnfosystems, Inc. A joint venture partnership of TRW Inc. and Elsevier Realty Information, Inc. PHALINX AGREEMENT AUGUST 29, 1995 In response to your proposed set of functional specifications dated August 28, 1995, we recommend the following methodology and applications changes to satisfy what we understand to be the users' requirements. I. USER INPUT AND & SYSTEM FUNCTIONALITIES When Customer logs into the C&I Online database, Customer is prompted with command line, i.e., COMMAND/FEATURE:, to enter search parameters using current methodology. In order to use the C&I online service Customer is required to know a few basic commands and syntax as any other system would. The following is an example of a search: E.G., ORANGE CA;APARTMENTS;12-14 UNITS;CITY ANAHEIM;SEARCH The above comps search criteria will look for apartments with 12 to 14 units in the county of Orange, California in the city of Anaheim. Once command line is entered and the search is executed, the customer receives a message with the number of records that matched their parameters: - -------------------------------------------------------------------------------- 35 records found. COMMAND/FEATURE: - -------------------------------------------------------------------------------- If the search parameter's are too wide, the search defaults to automatically stop as soon as 100 comps are found in the database and displays the following message: - -------------------------------------------------------------------------------- 100+ records found. COMMAND/FEATURE: - -------------------------------------------------------------------------------- II. MANIPULATING COMPS FOUND AND SEARCH PARAMETERS The interface is not a menu-driven system. Experienced users are familiar with the command line codes and do not require prompting. At anytime, however, the new user can get help and see all the valid commands/syntax simply by typing "HELP" at the COMMAND/FEATURE prompt. (see attachment D) Once Customer is notified of the number of comps found in the database and the COMMAND/FEATURE prompt is displayed, Customer has the following options: A. Customer can receive an answer set by entering the new command "VIEW' - one row per comp identified by line numbers. The "VIEW" command without including any range of line numbers will display on the screen all the comps found. "VIEW" has the same effect as "80 FORMAT;PRINT". The difference is that "VIEW" will not allow viewing in SHORT or DETAIL format and will not trigger the warning message for extra print fees. In order to allow ease of viewing and to prevent data rolling off the screen, Customer can limit the number of comps they can view by specifying a range or specific line numbers. For example, - -------------------------------------------------------------------------------- COMMAND/FEATURE: VIEW 1-15 - -------------------------------------------------------------------------------- Will display the following:
No. Street City St Sale Price Date Bldg Area Unit Lot Area Use 1 223 E CLIFTON ANAHEIM CA $ 685,OOOC 95/05 14,442 16 20,194 106 2 527 N ANNA ANAHEIM CA $ 400,OOOC 95/05 9,951 16 14,349 106 3 120 E PINE SANTA ANA CA $ 415,OOOC 95/04 7,350 14 13,121 106 4 1651 E LA HABRA LA HABRA CA $ 725,OOOC 95/03 15,570 15 30,120 106 5 8562 WATSON CYPRESS CA $ 660,OOOC 95/03 13,600 16 50,166 106 6 121 19 HUNTINGTO CA $2,100,OOOC 95/01 15,260 18 17,700 106 7 1541 W BALL ANAHEIM CA $ 557,OOOC 95/01 10,552 16 7,952 106 8 9752 ACACIA GARDEN GR CA $ 930,OOOC 95/01 18,832 16 39,390 106 9 6742 WESTERN BUENA PAR CA $ 861,375A 95/01 14,171 17 23,736 106 10 400 W VERMONT ANAHEIM CA $ 850,OOOC 95/01 13,770 14 16,800 106 11 7681 ELLIS HUNTINGTO CA $1,650,OOOC 94/12 19,830 16 34,300 106 12 17542 JEFFERSON HUNTINGTO CA $ 980,OOOF 94/12 14,284 15 26,307 106 13 1418 W DAHL SANTA ANA CA $ 440,OOOC 94/12 9,040 16 23,045 106 14 3185 HELENA ANAHEIM CA $1,150,OOOF 94/12 12,700 14 17,955 106 15 504 PAULINE ANAHEIM CA $ 550,000F 94/11 10,172 16 19,880 106
To view the next answer set, the customer will enter - -------------------------------------------------------------------------------- COMMAND/FEATURE: VIEW 16-30 - -------------------------------------------------------------------------------- The scroll-up/scroll down feature can be accomplished by simply supplying the line number range with the VIEW command. This also allows Customer the ability to view any single comp or range of comps in any sequence as many times as they wish to until they begin a "NEW" search. VIEW 3-10 will display comp numbers 3 through 10; VIEW 5,21,26-30 will display comp numbers 5, 21 and 26 through 30; etc. B. Customer can choose to PRINT, VIEW the answer set again, make modifications to the search parameters, or EXIT the system. As enumerated in COMPS Inc.'s proposed functional specifications, here is how these requested user tasks can be accomplished in the current system. Once all of the records have been viewed in the answer set format, Customer can do any of the following: 1) PRINT SELECTED COMPS IN THE 6-LINE FORMAT Solution: Type in SHORT;PRINT 3,5,9,16,20 (see notes below) (see attachment A: SHORT format) 2) PRINT SELECT COMPS IN THE FULL-RECORD FORMAT. Solution: Type in DETAIL;PRINT 1, 6,9 (see notes below) (see attachment B: DETAIL format) 3) RETURN TO FIRST PAGE OF THE ANSWER SET Solution: Customer can view any portion of the one-line display at any time by using the VIEW command, e.g. VIEW 1-15 4) EXIT BACK TO THE SEARCH PARAMETERS TO MAKE ADJUSTMENTS Solution: It is not necessary to exit. Customer simply enters additional parameters at the COMMAND/FEATURE prompt. 5) EXIT SYSTEM by entering one of the following: LOG, LOGOFF, BYE Notes: a. "Tagging" of the desired comps is accomplished by specifying the line number(s) or range(s) in the PRINT command. b. Additional print fees cannot be dynamically calculated. The following new message will be displayed when DETAIL or SHORT is selected for printing: ---------------------------------------------------------------------- Notice: You will be charged an additional fee for each record printed. Please make sure your printer is set to capture screen output: [Return] to continue [Control Z] to exit This notice can be turned on or off by entering "SET NOTICE OFF" or "SET NOTICE ON" at the COMMAND/FEATURE prompt. ---------------------------------------------------------------------- c. The per minute fee can vary by customer. The fees for 6-line (SHORT) and full-record (DETAIL) formats must currently be a fixed amount for all customers. III. OUTPUT RECORD SCREEN LAYOUTS (see attachments A, B, C)
ATTACHMENT A: SHORT FORMAT - -------------------------- 3) Address:328 W 1 ST, SAN PEDRO Use :APARTMENT APN :7449-023-028+ Price: $ 850,000F Date:07/07/95 Bldar:17,056 County :LOS ANGELES CA $/Sq : $ 49.84 Doc#:1091308 Units:22 MapPg :79-A2 NewPg:824-C4 AssdLd: $ 681,252 Zone:R4-1 LAStory:2 Source:I Total: $2,384,384 Lot :24,400 Yrblt:1986/88 Comment:8 VACANCIES AT SALE 7/6/95 ------------------------------------------------------- 5) Address:433 OHIO AV, LONG BEACH Use :APARTMENT APN :7263-022-017 Price: $ 260,000F Date:07/12/95 Bldar:3,800 County :LOS ANGELES CA $/Sq : $ 68.42 Doc#:1118975 Units:10 MapPg :75-F5 NewPg:795-H7 AssdLd: $ 43,803 Zone:RR2N LBStory:1 Source:I Total: $ 94,263 Lot :6,400 Yrblt:1923/68 Comment:1) 8UN,2816#,23YB;2)1UN,984#,3BD,1BA ------------------------------------------------------- 9) Address:428 -32 BONITO AV, LONG BEACH Use :APARTMENT APN :7266-009-008 Price: $ 235,000F Date:07/05/95 Bldar:5,323 County :LOS ANGELES CA $/Sq : $ 44.15 Doc#:1074294 Units:8 MapPg :75-D5 NewPg:795-E7 AssdLd: $ 47,568 Zone:RR3S LBStory:2 Source:I Total: $ 135,918 Lot :7,496 Yrblt:1922/68 Comment:MO - MARKET; SALE 6/13/95 ------------------------------------------------------- 16)Address:3937 W IMPERIAL HY, HAWTHORNE Use :APARTMENT APN :4033-025-003 Price: $ 215,000C Date:07/05/95 Bldar:5,296 County :LOS ANGELES CA $/Sq : $ 40.60 Doc#:1070595 Units:13 MapPg :57-B5 NewPg:703-E7 AssdLd: $ 164,487 Zone:C2 LAStory:2 Source:I Total: $ 546,521 Lot :7,980 Yrblt:1960/68 Comment:BUYER; SALE 5/22/95 ------------------------------------------------------- 20)Address:1058 WALNUT AV, LONG BEACH Use :APARTMENT APN :7267-011-001 Price: $ 50,000P Date:07/06/95 Bldar:6,876 County :LOS ANGELES CA $/Sq : Doc#:1083003 Units:9 MapPg :75-E4 NewPg:795-G6 AssdLd: $ 163,200 Zone:R4* LAStory:2 Source:I Total: $ 341,700 Lot :6,110 Yrblt:1962/80 Comment:2-3BR/1BA $575/MO - MARKET -------------------------------------------------------
ATTACHMENT B: DETAIL FORMAT (1 OF 3) - ------------------------------------ Address:328 W 1 ST, SAN PEDRO 90731 County :LOS ANGELES CA Land Use :APARTMENT Lot Size :200X122 Bldg Area: 17,056 New Page :824-C4 Lot Area :24,400 Rent Area: Map Page :79-A2 Source :I Zoning :R4-1 LA Bsmt Area: APN-Acct#:7449-023-028+ Ofc. Area: Census Tr:2962.00 Year Blt :1986/88 Assessed Land: $ 681,252 # Bldgs : 1 Park Type:PAVED Improvement: $1,703,132 # Stories : 2 Park Spcs:30 Total Value: $2,384,384 Units : 22 Paving : Assessed Yr:94 CLASS D BUILDING; AVERAGE QUALITY; AVERAGE CONDITION; FRAME $/Sqft : $ 49.84 CONSTRUCTION; WOODFRAME; STUCCO EXTERIOR; CONCRETE FOUNDATION; G.I.M. : 6.13 GABLE ROOF; COMPOSITION SHINGLE ROOF; WALL FURNACE HEAT; NO Cap Rate: 6.15 A/C; 22-2BR/1BA ;;$525/MO-MARKET;; 8 VACANCIES AT SALE RNT/#/MO: $0.67 7/6/95 Price/Un:$38,636 Publication Reference: SBA-08/95-0059 Multi-APN:7449-23-(27,30) A Legal Dsc:L15, L18 & L19 /MC DONALD'S SUB Price : $840,000F Sale Date:07/07/95 Gross Income : $ 138,600 Cash Down : $307,500 Document#:1091308 Expenses : $ 37,837 1st Mtg : $542,500H Int: Yrs: Net Income : $ 52,253 2nd Mtg : Int: Yrs: Prev Sale : $75,000U Prev Date:12/31/91 Buyer : CARSON, THOMAS & BARBARA Address : 500 SILVER SPUR RD #201;RLLNG HLS EST,CA 90275;310/377-5552 Seller : SHAFFER, DENNIS Address : 500 SILVER SPUR RD #201;RLLNG HLS ES Lender : QUAKER CITY FED'L
ATTACHMENT B: DETAIL FORMAT (2 OF 3) - ------------------------------------ 6) Address:5895 -909 MAKEE ST, LOS ANGELES 90001 County :LOS ANGELES CA Land Use :APARTMENT
Lot Size :A.49 Bldg Area: 8,514 New Page :674-F5 Lot Area :21,600 Rent Area: Map Page :52-D4 Source : Zoning :R3 LC Bsmt Area: APN-Acct#:6008-036-013 Ofc. Area: Census Tr:5327.00 Year Blt :1948/60 Assessed Land: $220,814 # Bldgs : 4 Park Type:PAVED Improvement: $618,284 # Stories : 1 Park Spcs:28 Total Value: $839,098 Units : 28 Paving : Assessed Yr:94 CLASS D BUILDING;AVERAGE QUALITY;FAIR CONDITION;FRAME $/Sqft : $ 542.87 CONSTRUCTION;WOOD FRAME;STUCCO EXTERIOR; CONCRETE FOUNDATION; G.I.M. : 4.35 GABLE ROOF;COMPOSITION SHINGLE ROOF;WALL FURNACE HEAT;NO Cap Rate : 12.52 A/C;REO SALE 7/95; 28-SG;L $250/MO;2-7UN-2160# EA; RNT/#/MO : $ 0.82 2-4UN-1332# EA;3UN-918#;2UN-612#; 27 SGLS Price/Un : $ 13,036 Publication Reference: SBA-08/95-0005 Legal Dsc:L16-20 /AHREN'S MIRAMONTE A Price : $365,000F Sale Date:07/03/95 Gross Income : $ 84,000 Cash Down : $54,750 Document#:1056622 Expenses : $ 25,704 1st Mtg : $182,500H Int: Yrs: Net Income : $ 45,696 2nd Mtg : $127,750S Int: Yrs: Prev Sale : $760,000F Prev Date:03/14/89 Buyer :MENDEZ ORTELIO & MENDEZ, E Address :225 JASON CT;PERRIS,CA 925719100;213/588-5536 Seller :PRESIDENTIAL MTG Address :21031 VENTURE BLVD 1ST FLR;WOODLAND HILL Lender :PACIFIC T&L
ATTACHMENT B: DETAIL FORMAT (3 OF 3) - ------------------------------------ 9) Address:133 -35 e 73 ST, LOS ANGELES 90003 County :LOS ANGELES CA Land Use :APARTMENT
Lot Size :60X120 Bldg Area: 3,906 New Page :704-D1 Lot Area :7,205 Rent Area: Map Page :52-B6 Source :I Zoning :R2-1 LA Bsmt Area: APN-Acct#:6022-001-023 Ofc. Area: Census Tr:2396.00 Year Blt :1929/75 Assessed Land: $ 76,406 # Bldgs : 4 Park Type:PAVED Improvement: $199,506 # Stories : 1 Park Spcs:4 Total Value: $275,912 Units : 8 Paving : Assessed Yr:94 CLASS D BUILDING;AVERAGE QUALITY;FAIR CONDITION;FRAME S/Sqft : $ 33.28 CONSTRUCTION;WOOD FRAME;STUCCO EXTERIOR; RAISED FOUNDATION; G.I.M. : 3.01 FLAT ROOF; ROLL COMPOSITION ROFF COV; WALL FURNACE HEAT;NO Cap Rate: 9.70 A/C;REO SALE 5/26/95;; 8-1BR $450/MO;;2 DUPS 1000# EA; RNT/#/MO: $ 0.92 2SFR 500# EA; PER TENANTS Price/Un: $16,250 Publication Reference: SBA-08/95-0019 Legal Dsc:L19 TR4219 Price : $130,000F Sale Date:07/14/95 Gross Income : $ 43,200 Cash Down : $13,000 Document#:1135957 Expenses : $ 4,665 1st Mtg : $117,000S Int: Yrs: Net Income : $ 12,615 2nd Mtg : Int: Yrs: Prev Sale : $184,820C Prev Date:05/30/91 Buyer :MELGOZA MARTIN Address :1431 W. 89TH ST; LOS ANGELES, CA 900473417 Seller :SOUTHERN PACIFIC T & L Address :12300 WILSHIRE BL; LOS ANGELES, CA 90025 Lender :SELLER
ATTACHMENT C: ONE-LINE FORMAT - -----------------------------
No. Street City St Sale Price Date Bldg Area Unit Lot Area Use 1 223 E CLIFTON ANAHEIM CA $ 685,OOOC 95/05 14,442 16 20,194 106 2 527 4 ANNA ANAHEIM CA $ 400,OOOC 95/05 9,951 16 14,349 106 3 120 E PINE SANTA ANA CA $ 415,OOOC 95/04 7,350 14 13,121 106 4 1651 E LA HABRA LA HABRA CA $ 725,OOOC 95/03 15,570 15 30,120 106 5 8562 WATSON CYPRESS CA $ 660,OOOC 95/03 13,600 16 50,166 106 6 121 19 HUNTINGTO CA $2,100,OOOC 95/01 15,260 18 17,700 106 7 1541 W BALL ANAHEIM CA $ 557,OOOC 95/01 10,552 16 7,952 106 8 9752 ACACIA GARDEN GR CA $ 930,OOOC 95/01 18,832 16 39,390 106 9 6742 WESTERN BUENA PAR CA $ 861,375A 95/01 14,171 17 23,736 106 10 400 W VERMONT ANAHEIM CA $ 850,OOOC 95/01 13,770 14 16,800 106 11 7681 ELLIS HUNTINGTO CA $1,650,OOOC 94/12 19,830 16 34,300 106 12 17542 JEFFERSON HUNTINGTO CA $ 980,OOOF 94/12 14,284 15 26,307 106 13 1418 W DAHL SANTA ANA CA $ 440,OOOC 94/12 9,040 16 23,045 106 14 3185 S HELENA ANAHEIM CA $1,150,OOOF 94/12 12,700 14 17,955 106 15 504 N PAIJLINE ANAHEIM CA $ 550,OOOF 94/11 10,172 16 19,880 106
ATTACHMENT D - ------------
*** SEARCHABLES *** *** FILTERS *** APN OWNER or BUYER CENSUS RECTYPE BLDAR or LVAREA PAGEGRID or AREA CONSTRUCTION SALECODE CITY SALEDATE DIRECTION SITEINFLUENCE COUNTY SALEPRICE DOLLARSQFT SOURCE INCOMNET STATE GRLEASE STORIES LANDUSE STREET GROSS INCOME SUFFIX LVAREA UNITS LOTAREA TOTALVALUE NUMBER OFFICEAREA UNITNO PARKSPACES YEARBUILT POOL ZONING RAILSPUR *** COMMANDS *** *** FORMATS *** DELETE MENU or OPTION DETAIL SHORT DSORT NEW 80 FORMAT PRINT JOBID SEARCH LIST SORT (VIEW)
NOTE: ITEMS IN PARENTHESIS CURRENTLY NOT IMPLEMENTED. ADDENDUM TO AND AMENDMENT OF PURCHASE AGREEMENT BY AND BETWEEN COMPS INFOSYSTEMS, INC. AND TRW REDI PROPERTY DATA DATED AUGUST 31, 1995 This Addendum to and Amendment ("Addendum & Amendment") of Purchase Agreement by and between COMPS InfoSystems, Inc. ("COMPS") and TRW REDI Property Data dated August 31, 1995 (the "Purchase Agreement") is entered into this 20th day of November, 1997 by and between COMPS and Experian Information Solutions, Inc. ("Experian RES"), the successor in interest to TRW REDI under the Purchase Agreement. The relationship of the parties hereto with respect to the subject matters hereof and the subject matters of the Purchase Agreement shall be governed by the Purchase Agreement and this Addendum & Amendment, read together as a whole. Except as set forth herein, all terms and provisions of the Purchase Agreement remain unmodified and in full force and effect and are binding upon COMPS and Experian RES. Terms used and not otherwise defined herein shall have the definitions given them in the Purchase Agreement. 1. Recitals: --------- WHEREAS, COMPS and TRW REDI Property Data ("TRW REDI") are parties to the Purchase Agreement; WHEREAS, Experian RES is the successor-in-interest to TRW REDI under the Purchase Agreement and is bound by all of the obligations of TRW REDI thereunder; WHEREAS, the parties desire to provide for the purchase by COMPS of the Florida and Georgia C&I Data Extract Business, on the terms and conditions set forth herein; WHEREAS, the parties desire to provide for the expansion of the Sales Agency of Experian RES described in Section 3 of the Purchase Agreement; and WHEREAS, the parties desire to further amend and supplement the Purchase Agreement as set forth herein; NOW THEREFORE, the parties hereto agree as follows: 2. Parties. The Purchase Agreement is hereby amended to substitute ------- "Experian RES" in place of "TRW' and "TRW REDI" in each instance such defined term occurs throughout the Purchase Agreement. 3. Business Sale and Transfer. Upon the Closing (as defined below), and -------------------------- upon the terms and subject to the conditions of this Addendum & Amendment, Experian RES agrees to sell, assign, transfer and convey to COMPS, and COMPS agrees to purchase and acquire from Experian RES, all of Experian RES's right, title and interest in and to all of the Assets of the Florida & Georgia C&I Data Extract Business, which is part of the Real Estate Solutions Group within Experian RES. For purposes of this Addendum & Amendment, "Assets" shall have the meaning set forth in Section 2.2 of the Purchase Agreement and, in addition, shall include the right to publish the products of the Purchased Businesses in substantially the same formats and media and containing substantially the same types of information as had been provided to customers by Experian RES; provided that the "Purchased Businesses" shall be deemed to include the Florida & Georgia C&I Data Extract Business. A complete and accurate schedule of the Accounts Receivable of the Florida & Georgia C&I Data Extract Business shall be attached hereto as Exhibit A (Experian RES will forward any accounts receivable collected after - --------- Closing within 30 days of receipt). Assets shall also include, without limitation, all work-in-process, print masters, pertinent software and finished goods inventory as relates directly to the Florida & Georgia C&I Data Extract Business. The Assets will be sold, assigned, transferred and conveyed to COMPS upon the Closing, free and clear of all mortgages, pledges, liens, licenses, rights of possession, security interests, restrictions, encumbrances, charges, title retention, conditional sale or other security arrangements and all claims or agreements of any nature whatsoever (except for Experian RES's obligations with respect to licenses and other agreements with customers assigned to and accepted and assumed by COMPS pursuant to the terms of this Addendum & Amendment, all of which are identified on Exhibit B). ---------- 3.1. Assignment of Experian RES Contract; Fulfillment of Obligations --------------------------------------------------------------- to Customers. Experian RES will assign to COMPS and COMPS agrees to fulfill and - ------------ assume, subject to Section 3.2 ("Liabilities Not Assumed") hereof, those agreements with customers set forth in Exhibit B. The obligations of the parties set forth in Section 2. 1 .1 of the Purchase Agreement shall apply with respect to contracts of the Florida & Georgia C&I Data Extract Business not assigned to COMPS. 3.1.1. Post-Closing Publication Obligations. Following the ------------------------------------ Closing, and notwithstanding anything in this section or this Addendum & Amendment to the contrary, Experian RES agrees to publish the regular products of the Florida & Georgia C&I Data Extract Business identified on Exhibit C on --------- such products' standard publication schedules and for a period of sixty (60) days following the Closing. Such publication in the first thirty (30) days of said period shall be at the expense of Experian RES and in the second thirty (30) days of said period shall be at the expense of COMPS, reimbursable by COMPS to Experian RES in an amount equal to actual publication costs (including direct labor, printing and packaging) not to exceed Eleven Thousand Six Hundred Dollars ($11,600.00) based on existing quantities at the time of Closing. If said quantities are greater, the actual publication cost shall be increased proportionately. The amount due hereunder shall be paid by COMPS to Experian RES net thirty (30) days. Notwithstanding the foregoing, in the event COMPS provides notice to Experian RES on or prior to December 15, 1997 that COMPS does not desire the publication or production of any product or products (or portion thereof), Experian RES shall not publish or produce, as applicable, such product or products (or portion(s)) during the second thirty (30) day period and the amount of COMPS's obligations to reimburse expenses of Experian RES shall be reduced accordingly based upon publication and production cost information identified on Exhibit F. --------- 3.2. Liabilities Not Assumed. Except as specifically set forth in ----------------------- Section 3.1, above, Experian RES does not transfer hereunder and COMPS does not assume hereby, any liability associated with the Florida & Georgia C&I Data Extract Business. Experian RES agrees to defend, indemnify and hold COMPS harmless against any and all loss, cost, claims and liabilities not expressly assumed by COMPS hereunder, including but not limited to any liabilities arising under any contracts relating to the Florida & Georgia C&I Data Extract -2- Business, and based upon facts, circumstances or events occurring prior to the Closing. Without limiting the generality of the foregoing, Experian RES shall be solely responsible for any refunds and/or cancellations fees it becomes obligated to pay as a result of the attempted transfer of Experian RES customer agreements to COMPS pursuant to this Addendum & Amendment or the Purchase Agreement. 4. Purchase Price. At the Closing, COMPS shall pay to Experian RES *** -------------- Dollars ($***). 4.1. Amendment of Purchase Price and Payment Terms in Purchase --------------------------------------------------------- Agreement. The schedule of payments set forth in Section 2.5 of the Purchase - --------- Agreement is hereby amended to read in full as follows: Date Amount ---- ------ 12/1/97 $*** 12/1/98 $*** 12/31/99 $*** 12/31/00 $*** 12/31/01 $*** 5. Purchase of Experian RES Data; Termination of Data Credit. Effective --------------------------------------------------------- upon the Closing, the Data Credit described in Section 2.5 of the Purchase Agreement shall terminate and be of no further force and effect with regard to Experian RES Data ("TRW REDI Data" as defined in the Purchase Agreement prior to the effectiveness of this Addendum & Amendment) purchased by COMPS following the Closing. 5.1. Amended Data Purchase. Upon the Closing and on each subsequent --------------------- annual anniversary of the Closing during the Amended Term (as defined herein), COMPS shall pay Experian RES *** Dollars ($***). In exchange for such payment, COMPS shall be entitled to obtain during the twelve-month period following such payment, Experian RES Data valued at *** Dollars ($***). In addition, COMPS shall have the right, at its option, to obtain up to an additional *** Dollars ($***) of Experian RES Data annually, based upon payment by COMPS of *** Dollars ($***) for each *** Dollars ($***) of Experian RES Data purchased by COMPS. The value of Experian RES Data purchased by COMPS shall be based upon the lowest price for such data offered by Experian RES to a Comparable Most Favored Customer at the time of the purchase of such data by COMPS, less a ten percent (10%) discount. For purposes of this Addendum & Amendment, "Comparable Most Favored Customer" shall mean any purchaser of Experian RES Data (other than Experian RES Related Parties, as defined below) in comparable quantities as those purchased by COMPS. All of such Experian RES Data purchased pursuant to this Section shall be delivered either through Experian RES's on-line service or in CD-ROM or other digital media (including, without limitation, mag tape), except that up to Five Percent (5%) of annual purchases by COMPS may, at COMPS's election, be in the form of Experian RES's -3- *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. printed and microfiche products. Any purchases by COMPS exceeding the limits herein specified shall be at prevailing Comparable Most Favored Customer prices. 5.2. COMPS Data Purchase Option. COMPS may at its option continue to -------------------------- purchase Experian RES Data on the terms described in Section 5.1 herein for a period two (2) years following the expiration of the Amended Term; provided, -------- however, in the event COMPS grants Expanded Rights to Other Existing On-line - ------- Distributors as defined and described in Section 5.3 herein, COMPS shall forfeit said post-Term option in accordance with the terms of Section 5.4 herein. 5.3. COMPS Arrangements With Other Existing On-line Distributors. In ----------------------------------------------------------- consideration of Experian RES's investment of time, effort and resources to increase the customer base and revenues for the COMPS Data, and further in consideration of the transfer of Assets of the Florida & Georgia C&I Data Extract Business, for a period of two (2) years commencing on the Closing Date, COMPS shall not grant an expansion of existing on-line distribution rights for any markets in addition to those markets for which such rights had already been granted as of August 1, 1997 ("Expanded Rights") to any other party with which COMPS has an existing arrangement or agreement with regard to the on-line distribution of COMPS Data and from which COMPS is presently realizing any royalties or other payments from said distribution ("Other Existing On-line Distributors"); provided, however, that after one (1) year from the Closing -------- ------- Date, COMPS shall have the right to grant such Expanded Rights to such Other Existing On-line Distributors if COMPS gives Experian RES six (6) months prior notice. Except as specified in this Section 5.3, none of the foregoing shall restrict the right of COMPS with regard to the entering into or expansion of any arrangement or agreement with any other party, including without limitation any entity not deemed to be an Other Existing On-line Distributor. For purposes of Section 5.3 herein, COMPS itself shall not be considered an Other Existing Online Distributor. 5.4. Forfeiture of Data Purchase Rights. If COMPS exercises its right ---------------------------------- to grant Expanded Rights to an Other Existing On-line Distributor, less than two (2) years from the Closing Date, then COMPS shall forfeit all rights with respect to the post-Term purchase of Experian RES Data, as provided for in Section 5.2 herein, for the two (2) year period following expiration of the Amended Term. 6. Rights in Data. -------------- 6.1. Amendment of Section 4 of Purchase Agreement. Section 4 of the -------------------------------------------- Purchase Agreement is hereby amended to read in full as follows: Except as expressly provided in this Agreement, each party reserves all proprietary rights in and to: (i) all of the underlying data, compilations and information gathered, compiled or published by such party in connection with the creation and preparation of the Licensed Data; (ii) all of the other data, compilations and publications created, prepared or authorized by each party not consisting of the Licensed Data; and (iii) all copyrights and other proprietary rights in any of the foregoing. -4- However, notwithstanding anything in any Experian RES Data subscription or other agreement to which COMPS may be subject, COMPS is expressly licensed and permitted to incorporate Experian RES Data into its permanent enhanced Investment Property database; provided, however, that (except as set forth in -------- ------- Section 3 of the Addendum & Amendment with respect to the Florida & Georgia C&I Data Extract Business) such incorporated information may not be transferred, re-sold, licensed or sub-licensed by COMPS "as is," except in a "work-in-process" format. The foregoing license shall survive termination of this Purchase Agreement as amended in the Addendum & Amendment. For purposes of this Purchase Agreement, as amended by this Addendum & Amendment, a "work-in-process" format shall mean a COMPS format which COMPS will enhance within an average of ninety (90) days from the date of first delivery to a COMPS customer with other proprietary and/or non-proprietary information added by COMPS. Except as set forth in the foregoing proviso, Experian RES Data may only be transferred, re-sold, licensed or sub-licensed by COMPS as part of COMPS Data or another COMPS enhanced information product. Nothing herein shall be construed as a license by Experian RES to COMPS relating to any Experian RES tradenames or trademarks. 6.2. Protection of COMPS Data. COMPS may, in its sole discretion, ------------------------ upon fifteen (15) days notice to Experian RES, prohibit Experian RES or any successor to or affiliate of Experian RES or its successors (for purposes of this Addendum & Amendment, "Experian RES Related Parties") from providing COMPS Data or any other COMPS proprietary information to any user or other third party whom COMPS reasonably believes has infringed or is infringing upon COMPS proprietary rights in such COMPS Data or COMPS proprietary information or software, and with respect to whom COMPS has taken some remedial action such as, for example, sending a written demand to cease and desist (a copy of which shall be included with any notice to Experian RES). In addition, neither Experian RES nor any Experian RES Related Party will use, provide access to, publish, transfer, license or sub-license COMPS Data for any purpose other than the distribution to bona fide end user customers of individual property reports. Neither Experian RES nor any Experian RES Related Party will make or cause to be made any derivative products or works from COMPS Data, append any data to COMPS Data or license or otherwise permit any third party other than a bona fide end user customer to perform analysis incorporating or relying upon COMPS Data. 7. Expansion of Sales Agency; Delivery of COMPS Data; Price. The parties -------------------------------------------------------- intend to expand the scope of Experian RES's Sales Agency to include all markets for which COMPS compiles and supplies an Enhanced C&I Product ("COMPS Markets") as of the date of Closing and as may subsequently be added during the Amended Term. Such markets as of the date hereof are set forth on Exhibit D, which --------- shall be amended to include any additional markets added from time to time during the Amended Term. Therefore, the definition of COMPS Data set forth in Section 1.7 of the Purchase Agreement is hereby modified so that all references to "California" (such references occurring in the second, ninth and last lines of such section) are -5- deleted, and such definition shall hereafter be read without geographic restriction to include all geographic markets within which COMPS provides such products. 7.1. Delivery of COMPS Data. On or before thirty (30) days following ---------------------- the Closing (as defined below), COMPS shall deliver to Experian RES one (1) year of historical COMPS Data (as defined in the Purchase Agreement and amended and modified by this Addendum & Amendment), to the extent such COMPS Data then exists, for each COMPS Market and shall on a timely basis deliver to Experian RES weekly updates of new transactions in such markets (this amends Section 5.1.2 of the Purchase Agreement). Said deliveries (of both historical and updated data) shall be made by COMPS in accordance with subsections 5.1.3 ("Shipping Address") and 5.1.4 ("Format & Layout") of the Purchase Agreement, unless altered or modified by the mutual consent of the parties. Notwithstanding anything herein or in the Purchase Agreement to the contrary, COMPS may withhold the data elements "confirmed sales price" and "cap rates" from COMPS Data for markets in Non-Disclosure States, as defined herein. 7.2. Additional COMPS Markets. For all geographic markets in addition ------------------------ to the current COMPS Markets identified on Exhibit D, for which COMPS initiates --------- the sale of Enhanced C&I Data during the Amended Term hereof, COMPS shall deliver to Experian RES weekly updates and, to the extent commercially available from COMPS, historical COMPS Data. 7.3. Amendment of Fees Paid to Experian RES. The parties desire to -------------------------------------- increase the COMPS Data Commission Fees provided in the Purchase Agreement. Accordingly, Section 3.3 ("Fees Paid to Experian RES") of the Purchase Agreement is amended to read in full as follows: "3.3 Fees Paid to Experian RES. In consideration ------------------------- of its performance under the Sales Agency,(***%) COMPS agrees to pay Experian RES *** percent (***%) of Gross Revenues collected by Experian RES for the benefit of COMPS." 7.4. Restrictions on Price Increases. Subsection 3.1.1 of the ------------------------------- Purchase Agreement is hereby amended to read in full as follows: "3.1.1 Obligations of Experian RES. In connection --------------------------- with the Sales Agency, Experian RES agrees (i) it shall publish COMPS Data as a stand-alone product and only in the format attached hereto as Exhibit C-2; (ii) it shall ----------- make COMPS Data available through its on-line database services to Experian RES subscribers on a consistent basis; (iii) it shall provide a level of customer service to purchasers of COMPS Data consistent with the level of service provided by Experian RES to subscribers to other Experian RES on-line information services; (iv) Experian RES will use its reasonable efforts to keep its on-line technology current with competitive on-line services; and (v) Experian RES shall use reasonable care to notify its on-line subscribers that COMPS Data *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. -6- is owned by COMPS and subject to copyright and other intellectual property protection. 7.4.1. Prices of COMPS Data. Effective from the Closing through -------------------- December 31, 1997, prices for COMPS Data shall remain as presently determined by COMPS. On January 1, 1998, said prices may be increased by COMPS to not more than $13.95 for each on-line report of a property with a most recent sale price of up to five million dollars ($5,000,000) ("Report A") or $19.95 for each on- line report of a property with a most recent sale price of five million dollars ($5,000,000) or more ("Report B"), and shall remain in effect at least until December 31, 1998. As of January 1, 1999, except by mutual agreement of the parties hereto said prices shall not exceed these maximum amounts as of their respective dates indicated. Notwithstanding any provision to the contrary herein, Experian RES shall offer and provide COMPS Data at such prices and terms determined by COMPS and provided to Experian RES (such prices to change at COMPS' discretion upon 30 days notice to Experian RES). In the event COMPS elects at its sole discretion to determine and set the prices for COMPS Data to be charged by Experian RES at any amount(s) higher than indicated in the following table, then COMPS shall pay to Experian RES one hundred thousand dollars ($100,000) within thirty (30) days of giving notice of such price change: Maximum per Report As of Report A Report B ----- -------- -------- January 1, 1999 $19.50 $26.00 January 1, 2000 $22.50 $30.00 January 1, 2001 $26.00 $35.00 January 1, 2002 $30.00 $40.00 7.4.2. Per-minute Usage Charges. Experian RES shall have sole ------------------------ discretion in the per-minute rates charges to users of its on-line system for access to and on-line digital transmission of COMPS Data in connection with the Sales Agency provided such per-minute rates are consistent with and comparable to those established by Experian RES and in effect with regard to its customers' access to databases other than COMPS Data on the Experian RES on-line system. 7.5. Scope of License. In connection with the expanded Sales ---------------- Agency as set forth herein, the parties agree that the license set forth in section 3.1 ("Sales Agency") of the Purchase Agreement shall be limited such that Experian RES, in the conduct of the Sales Agency, may not provide COMPS Data at prices other than those established by COMPS and in no event may COMPS Data be transferred without charge for promotional purposes or otherwise to any third party, including, without limitation, title companies. 8. Non-Disclosure States. COMPS shall have the right to withhold the --------------------- data element "confirmed sales price" and "cap rates" from the COMPS Data for markets in which there is a statutory restriction on the public disclosure by government agencies of real property sales prices (such states commonly known as "non-disclosure states"), as listed on Exhibit E and as may change from time to time; Experian RES shall have the commensurate right for the same states to withhold "sales price" (whether contained in the public record or obtained elsewhere) from the -7- data it supplies to COMPS under the Data Purchase arrangement provided for in Section 5 herein. 9. Certain Covenants. ----------------- 9.1. Notice in Event of Discontinuation of Coverage. Upon ---------------------------------------------- written notice to Experian RES, COMPS shall be entitled to discontinue the offer and sale of COMPS Data and/or Experian RES Data, respectively, in any market currently served by the Florida and Georgia C&I Data Extract Business. Each party agrees to provide a minimum of ninety (90) days' notice prior to discontinuing the offer and sale of COMPS Data and/or Experian RES Data, respectively, in any other market. In the event that COMPS discontinues its services or the products for any markets served currently by Experian RES in its Florida & Georgia C&I Data Extract Business, Experian RES shall have no obligation to customers with respect thereto other than any obligation remaining with Experian RES as a result of Section 3.2 ("Liabilities Not Assumed") hereof. 9.2. Covenant Not to Compete. For a period of nine (9) months ----------------------- commencing on the date of Closing (as defined below), Experian RES shall not, directly or indirectly, through an Experian RES Related Party or otherwise, make available through its on-line database services any of the COMPS Data for the geographic markets addressed by the Florida & Georgia C&I Data Extract Business ("Florida & Georgia Markets"), and Experian RES shall not, directly or indirectly, through an Experian RES Related Party or otherwise, solicit any print customer of the Florida & Georgia C&I Data Extract Business to cancel its print subscription in lieu of Experian RES's on-line services. In addition, Experian RES agrees for such nine (9) month period following the Closing that it will not, directly or indirectly, through an Experian RES related party or otherwise, make any on-line pricing offers in the Florida & Georgia Markets materially inconsistent with Experian RES's on-line pricing elsewhere. Experian RES further agrees that, for a period of one (1) year following termination of the Amended Term (as defined below), it shall not, directly or indirectly, through an Experian RES Related Party or otherwise, enter into or conduct or assist another to conduct the C&I Data Extract Business or C&I Photo Illustrated Business in any market covered by COMPS Data as of the termination of the Amended Term. 10. Term. The Purchase Agreement, as amended by this Addendum & ---- Amendment, shall have an initial term ("Initial Term") of five (5) years from the date of Closing as provided for in Section 11 hereof, and shall renew automatically for successive one (1) year periods ("Renewal Terms") unless terminated by either party upon provision of written notice to the other at least six (6) months prior to the end of the Initial Term or any subsequent Renewal Term. The period from the date of the Purchase Agreement through the termination of such agreement as amended by this Addendum & Amendment, shall be referred to herein as the "Amended Term." 11. Closing. The closing of the transactions contemplated by this ------- Addendum & Amendment (the "Closing") shall occur at a mutually agreeable location and time on December 1, 1997, and shall be deemed to be closed on 12:01 a.m. on said date. -8- 11.1. Payment. At the Closing, COMPS shall deliver or cause to be ------- delivered to Experian RES the *** Dollar ($***) payment described in Section 4 hereof and the *** Dollar ($***) payment described in Section 5.1 hereof. 11.2. Further Documents. At any time before or after the Closing, ----------------- each party shall execute, acknowledge and deliver any further deeds, assignments, conveyances, and other assurances, documents and instruments of transfer reasonably requested by the other, and will take any other action consistent with the terms of this Addendum & Amendment that may reasonably be requested by the other. 12. Conditions Precedent to COMPS' Performance. The obligation of COMPS ------------------------------------------ to consummate the transactions contemplated by this Addendum & Amendment is subject to the satisfaction, at or before the Closing, of all the conditions set forth below in this Section 12. COMPS may waive in writing any or all of these conditions, in whole or in part, without prior notice; provided, however, that -------- ------- no such waiver of a condition shall constitute a waiver by COMPS of any of its other rights or remedies, at law or in equity, if Experian RES shall be in default of any of the representations or covenants under this Addendum & Amendment. 12.1. Financial Information. Experian RES shall have provided COMPS --------------------- with financial information to the reasonable satisfaction of COMPS that the annual purchase commitments existing as of November 7, 1997, from customers of Experian RES under contract for its Florida and Georgia C&I Data Extract Business is Two Hundred and Ninety Thousand Dollars ($290,000). 12.2. Due Diligence. Within five (5) business days of the execution ------------- of this Addendum & Amendment, COMPS shall have completed due diligence and be satisfied, in its sole discretion (i) that the transactions contemplated herein do not conflict with any material contract or commitment to which Experian RES is a party; (ii) that the status and condition of the Florida and Georgia C&I Data Extract Business are substantially as has been represented by Experian RES to COMPS; and (iii) as to the quality and quantity of the customer base for the Florida and Georgia C&I Data Extract Business. If such due diligence is not completed within the time provided and COMPS has not provided Experian RES with notice of its dissatisfaction with the results of such due diligence, this condition shall be deemed to have been waived. 12.3. Transfer of Business. Experian RES shall have transferred to -------------------- COMPS all of the Assets, and Experian RES shall have executed a Bill of Sale and Assignment in form reasonably satisfactory to COMPS and its counsel relating to the Assets. 12.4. Accuracies of Experian RES's Representations and Warranties. ----------------------------------------------------------- Except as otherwise permitted by this Addendum & Amendment, all representations by Experian RES in this Addendum & Amendment or in any written statement that shall be delivered to COMPS under this Addendum & Amendment shall be true on and as of the Closing as though made at that time. 13. Conditions Precedent to Experian RES's Performance. The obligation of -------------------------------------------------- Experian RES to consummate the transactions contemplated by this Addendum & Amendment is subject to the satisfaction, at or before the Closing, of all the conditions set out below in this -9- *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. section. Experian RES may waive in writing any or all of these conditions, in whole or in part, without prior notice; provided, however, that no such waiver of a condition shall constitute a waiver by Experian RES of any of its other rights or remedies, at law or in equity, if COMPS shall be in default of any of the representations or covenants under this Purchase Agreement. 13.1. Accuracies of COMPS's Representations. Except as otherwise ------------------------------------- permitted by this Addendum & Amendment, all representations by COMPS in this Addendum & Amendment shall be true on and as of the Closing as though made at that time. 13.2. Performance by COMPS. COMPS shall have performed, satisfied, -------------------- complied with all covenants, agreement, and conditions required by this Purchase Agreement to be performed or complied with by COMPS on or before the Closing. 13.3. President's Certificate as to Financial Condition. Experian ------------------------------------------------- RES shall have received a certificate duly executed by the President of COMPS, stating that the audited balance sheet of COMPS as of December 31, 1996 and the unaudited balance sheet of COMPS as of October 31, 1997 reflect cash and cash equivalents, together with amounts available under COMPS bank agreements and lines of credit, in excess of Eight Hundred Thousand Dollars ($800,000.00). 14. Warranties and Indemnification. ------------------------------ 14.1. Warranties. COMPS and Experian RES each represents and ---------- warrants to the other than (i) it has the right, title and authority to enter into and perform this Addendum & Amendment (including, in the case of Experian RES, good and marketable title to the Assets); and (ii) its execution, delivery and performance of this Addendum & Amendment will not conflict with the terms of any other agreement to which it is a party. COMPS and Experian RES each further covenant not to enter into any agreement which will conflict with the terms of this Addendum & Amendment. Neither party guarantees the accuracy or reliability of any Licensed Data. THIS WARRANTY IS THE ONLY WARRANTY WITH RESPECT TO THE LICENSED DATA, AND SUCH WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. 14.2. Limitation of Liability. EXCEPT AS SET FORTH IN SECTION 14.3, ----------------------- UNDER NO CIRCUMSTANCES WILL EITHER PARTY HAVE ANY OBLIGATION OR LIABILITY TO THE OTHER PARTY FOR ANY CLAIM, INJURY, OR DAMAGE RELATING TO, ARISING OUT OF, OR RESULTING FROM THE INACCURACY OF ANY LICENSED DATA. NOTWITHSTANDING ANY OTHER PROVISION OF THIS ADDENDUM & AMENDMENT, UNDER NO CIRCUMSTANCES WILL EITHER PARTY HAVE ANY OBLIGATION OR LIABILITY TO THE OTHER FOR ANY INCIDENTAL, SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES INCURRED BY THE 0THER PARTY, REGARDLESS OF HOW SUCH DAMAGES ARISE AND OF WHETHER OR NOT A PARTY WAS ADVISED SUCH DAMAGES MIGHT ARISE. 14.3. Other Parties; Indemnification. Each party will include ------------------------------ provisions consistent with those set forth in Sections 14.1 and 14.2, above, in any agreement pursuant to -10- which the Licensed Data is provided to any third party. Each party to this Addendum & Amendment will indemnify (in this capacity, the "Indemnifying Party"), defend and hold harmless the other party (the "Indemnified Party") hereto, its employees, agents and representatives, from and against any losses, claims, suits, costs and/or expenses, including attorney fees, arising out of or resulting from any claim by any third party to whom the Indemnifying Party has provided the Licensed Data and based exclusively on such Licensed Data, whether such data was provided prior to or during the Amended Term. The Indemnified Party shall provide prompt notice to the Indemnifying Party of a claim potentially giving rise to obligations under this section, and the Indemnifying Party shall be permitted to assume and control the defense thereof. The Indemnifying Party shall not be liable for any settlement entered into with its prior written consent, which shall not unreasonably be withheld. IN WITNESS WHEREOF, each party hereto has caused this Addendum & Amendment to be executed by its duly authorized representatives. EXPERIAN INFORMATION SOLUTIONS, INC. COMPS INFOSYSTEMS, INC. an Ohio corporation a Delaware corporation By: /s/ [illegible] By: /s/ CHRISTOPHER A. CRANE -------------------------------- ------------------------------ Title: Senior V.P. and Secretary Title: Pres & CEO ------------------------------ --------------------------- -11-
RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) Effective 01/01/96 to 11/07/97 (SALES TAX INCL.) # OF PRODUCT FL & GA COUNTY NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. ANNIV. DATE LEASE PRICE CUSTOMER AR DATE YEARS BAL ST FL BREVARD 1 *** 3725603 0473890 302 09/30/97 09/30/98 1 546.25 585.28 FL BREVARD 1 *** 2124016 0172865 401 10/29/96 10/29/97 1 411.60 0.00 FL BREVARD 1 *** 3477018 0323780 801 10/05/97 10/05/98 1 499.95 356.05 FL BREVARD 1 *** 3081657 0216085 303 11/10/97 11/10/98 1 1006.00 1,073.79 FL BREVARD 1 *** 2293037 2142805 500 10/10/97 10/10/98 1 757.50 763.75 FL BREVARD 1 *** 2288219 0196502 400 04/28/97 04/28/98 1 0.00 0.00 FL BREVARD 1 *** 2298708 2142871 403 05/10/97 05/10/98 1 732.60 304.38 FL BREVARD 1 *** 3400324 2008271 200 10/18/97 10/18/98 1 1006.00 1,091.36 FL BFIEVARD 1 *** 3147450 3027612 702 07/10/97 07/10/98 1 419.10 0.00 FL BREVARD 1 *** 2950648 0205905 301 03/10/97 03/10/98 1 875.00 0.00 FL BREVARD 1 *** 3613103 0220301 100 03/28/97 03/28/98 1 0.00 0.00 FL BREVARD 1 *** 2320058 2142839 401 09/30/97 09/30/98 1 732.60 633.71 FL BREVARD 1 *** 3090167 0284966 900 12/28/97 12/28/98 1 0.00 0.00 FL BREVARD 1 *** 2915683 2014768 200 10/30/97 10/30/98 1 0.00 0.00 FL BREVARD 1 *** 0038841 0237919 200 12/28/97 12/28/98 1 0.00 0.00 FL BREVARD 1 *** 3495111 0341510 701 04/10/97 04/10/98 1 1090.00 0.00 FL BREVARD 1 *** 3515332 0357563 704 08/10/97 08/10/98 1 640.00 0.00 FL BREVARD 1 *** 3014600 0187524 600 08/27/97 08/27/98 1 0.00 0.00 FL BREVARD 1 *** 2462851 0235541 001 03/10/97 03/10/98 1 750.00 0.00 FL BREVARD 1 *** 2595478 0175928 301 01/10/98 01/10/99 1 739.00 789.59 FL BREVARD 1 *** 2444796 2123182 502 11/10/97 11/10/98 1 738.75 788.94 FL BREVARD 1 *** 3175963 0239070 102 11/10/97 11/10/98 1 694.65 744.12 FL BREVARD 1 *** 2354107 2142874 503 10/10/97 10/10/98 1 0.00 0.00 FL BREVARD 1 *** 3532410 0349532 601 03/10/97 03/10/98 1 950.00 1,032.00 FL BREVARD 1 *** 3532421 0941354 701 08/25/97 08/25/98 1 431.67 0.00 FL BREVARD 1 *** 2181664 2142822 502 11/03/97 11/03/98 1 694.65 744.12 FL BREVARD 1 *** 2536361 2142830 402 04/01/97 04/01/98 1 610.00 0.00 FL BREVARD 1 *** 3665679 2027953 000 03/25/97 03/25/98 1 990.00 1,084.30 FL BREVARD 1 *** 3398940 0278748 800 04/10/97 04/10/98 1 620.00 202.88 FL BREVARD 1 *** 3800458 2018869 000 03/07/97 03/07/98 1 990.00 0.00 FL BREVARD 1 *** 2016429 0354955 602 04/10/97 04/10/98 1 640.00 0.00
Page 1 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.
RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) Effective 01/01/96 to 11/07/97 - --------- (SALES TAX INCL.) # OF PRODUCT FL & GA COUNTY NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. ANNIV. LEASE PRICE CUSTOMER AR DATE DATE YEARS BAL ST FL BREVARD 1 *** 2296476 0323776 702 02/10/97 02/10/97 1 422.40 0.00 FL BREVARD 1 *** 2296476 8123184 500 01/10/98 01/10/98 1 739.00 789.59 FL BREVARD 1 *** 3170300 0239042 100 08/10/97 08/10/97 1 732.60 269.45 FL BREVARD 1 *** 3733770 0504778 201 07/24/97 07/24/98 1 373.75 335.36 FL BREVARD 8 *** 3308736 8237919 100 12/30/97 12/30/98 1 0.00 0.00 FL BROWARD 1 *** 2337799 2160527 402 03/10/97 03/10/98 1 758.17 0.00 FL BROWARD 1 *** 2989020 0175905 300 08/10/97 08/10/98 1 1285.00 1,362.10 FL BROWARD 1 *** 2012003 2127986 400 08/10/97 08/10/98 2 879.50 0.00 FL BROWARD 1 *** 2255727 2146237 400 05/01/97 05/01/98 1 758.17 647.39 FL BROWARD 1 *** 2124016 2146254 401 05/01/97 05/01/98 1 573.10 0.00 FL BROWARD 1 *** 3346037 0282455 903 10/10/97 10/10/98 1 588.06 524.20 FL BROWARD 1 *** 2146351 2160504 500 02/28/98 02/28/99 1 0.00 0.00 FL BROWARD 1 *** 2774941 2123322 502 04/10/97 04/10/98 1 1009.68 0.00 FL BROWARD 1 *** 3449718 2018776 000 04/10/97 04/10/98 1 1385.00 0.00 FL BROWARD 1 *** 3096152 0259150 902 05/10/97 05/10/98 2 1100.00 0.00 FL BROWARD 1 *** 3576629 0375361 609 10/10/97 10/10/98 1 648.00 691.88 FL BROWARD 1 *** 3695102 0452568 401 12/10/97 12/10/98 1 1480.00 1,582.01 FL BROWARD 1 *** 2498113 2160466 503 01/15/98 01/15/99 1 1480.00 1,585.95 FL BROWARD 1 *** 3147416 0176031 100 07/10/97 07/10/98 1 1285.00 0.00 FL BROWARD 1 *** 2207342 2123328 404 05/10/97 05/10/98 2 679.50 0.00 FL BROWARD 1 *** 2931049 0206917 403 12/10/97 12/10/98 1 1480.00 1,593.80 FL BROWARD 1 *** 3613103 0220370 100 03/28/97 03/28/98 1 0.00 0.00 FL BROWARD 1 *** 3090167 0258778 104 08/07/97 08/07/98 1 0.00 0.00 FL BROWARD 1 *** 0038841 0271265 100 07/18/97 07/18/98 1 0.00 0.00 FL BROWARD 1 *** 2013240 2189608 402 04/10/97 04/10/98 1 0.00 0.00 FL BROWARD 1 *** 2013240 2189608 403 10/07/97 10/07/98 1 1285.00 0.00 FL BROWARD 1 *** 3014600 2160393 500 10/30/97 10/30/98 1 0.00 0.00 FL BROWARD 1 *** 3673115 0445336 402 07/01/97 07/01/98 1 887.50 891.67 FL BROWARD 1 *** 2308416 2151544 402 05/10/97 05/10/98 1 898.75 (958.93 FL BROWARD 1 *** 3756964 2007363 202 08/01/97 08/01/98 1 767.50 654.17 FL BROWARD 1 *** 2210201 2123299 401 04/15/97 04/15/98 1 1132.50 0.00 FL BROWARD 1 *** 3556151 0351443 604 06/10/97 06/10/98 1 1285.00 0.00 FL BROWARD 1 *** 3026283 0183708 203 02/28/97 02/28/98 1 1285.00 0.00
Page 2 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.
RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) Effective 01/01/96 to 11/07/97 - --------- (Sales tax incl.) # OF PRODUCT FL & GA COUNTY NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. ANNIV. LEASE PRICE CUSTOMER AR DATE DATE YEARS BAL FL BROWARD 1 *** 3757116 2018722 101 05/20/98 05/20/99 1 1285.00 0.00 FL BROWARD 1 *** 2131795 2189613 401 05/10/97 05/10/98 1 1285.00 0.00 FL BROWARD 1 *** 3008157 0183064 302 03/10/97 03/10/98 1 1141.50 0.00 FL BROWARD 1 *** 2514587 2123343 403 05/10/97 05/10/98 1 1285.00 0.00 FL BROWARD 1 *** 2973685 0213588 300 06/10/97 06/10/98 1 1285.00 1,387.10 FL BROWARD 1 *** 2003540 0338023 701 05/01/97 05/01/98 1 1148.75 0.00 FL BROWARD 1 *** 2003540 2156536 401 05/01/97 05/01/98 1 765.83 0.00 FL BROWARD 1 *** 3625211 0408430 501 05/03/97 05/03/98 1 1285.00 970.97 FL BROWARD 1 *** 2147219 0205546 203 02/10/97 02/10/98 1 285.00 0.00 FL BROWARD 1 *** 2220136 2151556 503 02/27/97 02/27/98 1 900.00 0.00 FL BROWARD 1 *** 2780120 0450911 402 06/01/97 06/01/98 1 1285.00 0.00 FL BROWARD 1 *** 3385735 2160655 401 03/10/97 03/10/98 1 1285.00 0.00 FL BROWARD 1 *** 3805068 2017710 001 06/30/97 06/30/98 1 1285.00 0.00 FL BROWARD 1 *** 2773526 2123372 401 07/10/97 07/10/98 1 1285.00 916.89 FL BROWARD 1 *** 2170480 2123363 401 05/10/97 05/10/98 1 859.51 0.00 FL BROWARD 1 *** 2382078 2189625 403 06/10/97 06/10/98 1 0.00 0.00 FL BROWARD 1 *** 2264402 0187464 402 06/10/97 06/10/98 1 744.00 0.00 FL BROWARD 1 *** 2014881 2156510 401 04/15/97 04/15/98 1 131.84 0.00 FL BROWARD 1 *** 2162537 2002360 200 04/10/97 04/10/98 1 1285.00 182.99 FL BROWARD 1 *** 2309844 2179108 001 11/29/97 11/29/98 1 1480.00 1,505.00 FL BROWARD 1 *** 2167938 2179033 403 02/10/97 02/10/98 1 0.00 0.00 FL BROWARD 1 *** 3752427 2007221 300 09/10/97 09/10/98 1 0.00 0.00 FL BROWARD 1 *** 2795395 0482454 301 08/10/97 08/10/98 1 303.27 296.19 FL BROWARD 1 *** 2922773 0186783 402 11/15/97 11/15/98 1 999.05 1,063.16 FL BROWARD 1 *** 3662753 0427015 402 07/01/97 07/01/98 1 919.00 489.57 FL BROWARD 1 *** 2589510 0304366 805 08/15/97 08/15/98 1 1285.00 0.00 FL BROWARD 8 *** 3308736 8271265 100 12/30/97 12/30/98 1 0.00 0.00 FL DADE 1 *** 2989020 2008307 201 10/11/97 10/11/98 1 1325.00 1,429.50 FL DADE 1 *** 2012003 2167502 401 03/10/97 03/10/98 2 1155.00 0.00 FL DADE 1 *** 2255727 2146236 501 05/01/97 08/01/98 1 818.32 420.33 FL DADE 1 *** 2124016 2134363 501 11/09/97 11/09/98 1 545.00 583.55 FL DADE 1 *** 3346037 0282441 903 06/13/97 06/13/98 1 609.18 217.18 FL DADE 1 *** 2945950 8123259 503 10/01/97 10/01/98 1 2142.50 2,294.27
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RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) Effective 01/01/96 to 11/07/97 - --------- (SALES TAX INCL.) # OF PRODUCT FL & GA COUNTY NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. ANNIV. LEASE PRICE CUSTOMER AR DATE DATE YEARS BAL ST FL DADE 1 *** 3096152 0228743 201 06/10/97 06/10/98 1 1325.00 0.00 FL DADE 1 *** 3079593 0216778 301 10/28/97 10/28/98 1 1525.00 397.98 FL DADE 1 *** 3576629 0375363 609 10/10/97 10/10/98 1 528.75 564.64 FL DADE 1 *** 2498113 2134390 602 01/19/98 01/19/99 1 1525.00 1,634.33 FL DADE 1 *** 3147416 2030659 000 03/25/97 03/25/98 1 1498.00 0.00 FL DADE 1 *** 3613103 0220302 100 03/03/97 03/03/98 1 0.00 0.00 FL DADE 1 *** 2276818 0205528 301 10/01/97 10/01/98 1 1155.00 24.73 FL DADE 1 *** 3090167 0284975 000 12/05/97 12/05/98 1 0.00 0.00 FL DADE 1 *** 0038841 0300076 100 12/05/97 12/05/98 1 0.00 0.00 FL DADE 1 *** 2572154 2156596 500 05/24/97 05/24/98 1 1325.00 0.00 FL DADE 1 *** 3014600 0196520 400 05/07/97 05/07/98 1 0.00 0.00 FL DADE 1 *** 2730251 0205515 301 07/16/97 07/16/98 1 615.33 0.00 FL DADE 1 *** 2336231 2143053 402 10/27/96 10/27/97 1 0.00 0.00 FL DADE 1 *** 3756964 2007365 202 08/01/97 08/01/98 1 711.67 606.83 FL DADE 1 *** 3539792 0369333 601 05/01/97 05/01/98 1 1325.00 0.00 FL DADE 1 *** 3026283 2028288 100 07/16/97 07/16/98 1 1325.00 0.00 FL DADE 1 *** 3757116 2008315 302 10/10/98 10/10/99 1 1325.00 1,436.13 FL DADE 1 *** 3711280 0460278 301 05/16/97 05/16/98 1 1325.00 0.00 FL DADE 1 *** 2003540 2156801 501 11/10/97 11/10/98 1 0.00 0.00 FL DADE 1 *** 2719630 2028293 000 08/06/96 08/06/97 1 825.00 0.00 FL DADE 1 *** 2147219 2143046 500 02/10/98 02/10/99 1 1525.00 1,631.85 FL DADE 1 *** 2290131 2127965 500 11/14/97 11/14/98 1 434.62 464.54 FL DADE 1 *** 2585651 2143467 600 06/10/97 06/10/98 1 1325.00 0.00 FL DADE 1 *** 2780120 2146675 601 03/14/97 03/14/98 1 1325.00 0.00 FL DADE 1 *** 2111717 2134314 501 09/28/97 09/28/98 1 883.75 947.45 FL DADE 1 *** 2773526 0262602 001 03/10/97 03/10/98 1 1325.00 707.37 FL DADE 1 *** 2249685 2156598 503 11/01/97 11/01/98 1 1139.40 1,218.86 FL DADE 1 *** 3155204 2018891 000 04/01/97 04/01/98 1 797.67 334.71 FL DADE 1 *** 2014881 8251261 902 12/10/96 12/10/97 1 592.25 0.00 FL DADE 1 *** 3291852 2146300 504 12/01/97 12/01/98 1 1392.98 1,488.35 FL DADE 1 *** 2309844 2179109 600 11/29/97 11/29/98 1 0.00 0.00 FL DADE 1 *** 2243616 2134343 501 12/10/97 12/10/98 1 1024.35 1,095.47 FL DADE 1 *** 3752427 2022838 100 06/10/97 06/10/98 1 0.00 0.00
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RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) Effective 01/01/96 to 11/07/97 - --------- (SALES TAX INCL.) # OF PRODUCT FL & GA COUNTY NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. ANNIV. LEASE PRICE CUSTOMER AR DATE DATE YEARS BAL FL DADE 1 *** 3198757 0235782 102 01/28/97 01/28/98 1 1047.38 0.00 FL DADE 1 *** 2589510 2146608 402 08/15/97 08/15/98 1 324.06 0.00 FL DADE 2 *** 2363684 0207107 700 09/30/97 09/30/98 1 0.00 0.00 FL DADE 8 *** 3308736 8271267 000 12/30/97 12/30/98 1 0.00 0.00 FL DUVAL 1 *** 3544886 0367089 600 03/22/97 03/22/98 1 965.00 0.00 FL DUVAL 1 *** 3685118 0480442 402 09/30/97 09/30/98 1 965.00 0.00 FL DUVAL 1 *** 2248864 0130038 400 06/07/97 06/07/98 1 387.75 0.00 FL DUVAL 1 *** 3613103 0220265 100 04/15/97 04/15/98 1 0.00 0.00 FL DUVAL 1 *** 3090167 0258778 301 08/07/97 08/07/98 1 0.00 0.00 FL DUVAL 1 *** 3091641 8271268 100 12/05/97 12/05/98 1 0.00 0.00 FL DUVAL 1 *** 3014600 3276128 100 08/14/97 08/14/98 1 0.00 0.00 FL DUVAL 1 *** 3221880 2017777 000 08/12/97 08/12/98 1 965.00 0.00 FL DUVAL 1 *** 3054154 0182799 200 06/10/97 06/10/98 1 387.75 0.00 FL DUVAL 1 *** 3360796 0277782 900 10/30/97 10/30/98 1 0.00 0.00 FL DUVAL 1 *** 2566722 0130020 401 07/10/97 07/10/98 1 387.75 0.00 FL DUVAL 1 *** 2002419 0358229 601 09/30/97 09/30/98 1 621.50 0.00 FL DUVAL 1 *** 3658057 0439723 500 02/25/98 02/25/99 1 1110.00 1,207.15 FL DUVAL 1 *** 3213870 0251561 100 01/10/98 01/10/99 1 1110.00 1,195.43 FL DUVAL 1 *** 3265664 0235601 000 07/10/97 07/10/98 1 457.50 370.12 FL DUVAL 1 *** 2438124 0187553 600 06/25/97 06/25/98 1 457.50 287.88 FL DUVAL 1 *** 2438124 0187553 700 06/25/97 06/25/98 1 0.00 0.00 FL DUVAL 1 *** 3128086 2002259 202 06/15/97 06/15/98 1 965.00 842.19 FL DUVAL 1 *** 2572648 2130545 502 11/04/97 11/04/98 1 447.15 484.47 FL DUVAL 1 *** 2499257 8259961 000 03/17/97 03/17/98 1 965.00 0.00 FL DUVAL 1 *** 2486189 2017775 000 07/23/97 07/23/98 1 965.00 0.00 FL DUVAL 8 *** 3308736 9271268 100 12/30/97 12/30/98 1 0.00 0.00 FL HILLSBOROUGH 1 *** 3409664 0302309 802 04/10/97 04/10/98 1 449.50 0.00 FL HILLSBOROUGH 1 *** 2327006 2015993 101 02/13/97 02/13/98 1 702.00 0.00 FL HILLSBOROUGH 1 *** 2103895 2130772 301 05/10/96 05/10/97 1 680.00 0.00 FL HILLSBOROUGH 1 *** 3614651 0409315 502 10/01/97 10/01/98 1 465.00 505.88 FL HILLSBOROUGH 1 *** 2814267 2156386 303 05/10/97 05/10/98 1 685.00 0.00 FL HILLSBOROUGH 1 *** 2174516 2125072 403 03/14/97 03/14/98 1 780.00 0.00 FL HILLSBOROUGH 1 *** 3613103 0220264 100 04/15/97 04/15/98 1 0.00 0.00
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RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) Effective 01/01/96 to 11/07/97 - --------- (SALES TAX INCL.) # OF PRODUCT FL & GA COUNTY NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. ANNIV. LEASE PRICE CUSTOMER AR DATE DATE YEARS BAL FL HILLSBOROUGH 1 *** 3229963 0251165 001 04/10/97 04/10/98 1 0.00 0.00 FL HILLSBOROUGH 1 *** 3229963 2028139 000 03/10/97 03/10/98 1 0.00 0.00 FL HILLSBOROUGH 1 *** 3090167 0258778 600 08/07/97 08/07/98 1 0.00 0.00 FL HILLSBOROUGH 1 *** 0038841 0300077 101 12/05/97 12/05/98 1 0.00 0.00 FL HILLSBOROUGH 1 *** 3014600 0207125 300 09/30/97 09/30/98 1 0.00 0.00 FL HILLSBOROUGH 1 *** 2016539 2130450 702 01/30/98 01/30/99 1 797.97 857.55 FL HILLSBOROUGH 1 *** 3729595 0459312 302 01/01/98 01/01/99 1 785.00 847.44 FL HILLSBOROUGH 1 *** 2133380 2130413 401 12/10/96 12/10/97 1 678.75 0.00 FL HILLSBOROUGH 1 *** 2227533 2160774 502 12/10/97 12/10/98 1 654.00 704.78 FL HILLSBOROUGH 1 *** 3472464 0323542 801 08/10/97 08/10/98 1 780.00 0.00 FL HILLSBOROUGH 1 *** 2943534 0213602 203 06/10/97 06/10/98 1 780.00 0.00 FL HILLSBOROUGH 1 *** 3120783 0211713 303 06/10/97 06/10/98 1 780.00 0.00 FL HILLSBOROUGH 1 *** 3774711 2026766 101 09/12/97 09/12/98 1 780.00 0.00 FL HILLSBOROUGH 1 *** 3030022 2108269 200 02/21/98 02/21/99 1 1325.00 1,429.29 FL HILLSBOROUGH 1 *** 3455564 0323476 801 05/01/97 05/01/98 1 788.00 0.00 FL HILLSBOROUGH 4 *** 3151435 0232699 200 07/14/97 07/14/98 1 0.00 0.00 FL HILLSBOROUGH 8 *** 3308736 8271269 100 12/30/97 12/30/98 1 0.00 0.00 FL ORANGE 1 *** 2124016 2146280 402 09/30/97 09/30/98 1 0.00 0.00 FL ORANGE 1 *** 3707753 0452612 306 04/12/97 04/12/98 1 760.00 0.00 FL ORANGE 1 *** 2246660 0166425 302 07/10/96 07/10/97 1 0.00 0.00 FL ORANGE 1 *** 2281193 0219404 002 12/10/96 12/10/97 1 615.00 0.00 FL ORANGE 1 *** 2525859 0277343 701 12/01/96 12/01/97 1 0.00 0.00 FL ORANGE 1 *** 2524650 2166168 400 06/10/97 06/10/98 1 825.11 0.00 FL ORANGE 1 *** 2782298 0166396 403 10/10/97 10/10/98 1 683.75 731.03 FL ORANGE 1 *** 2972778 0211755 301 01/10/98 01/10/99 1 694.00 747.23 FL ORANGE 1 *** 2743297 0166486 401 09/10/97 09/10/98 1 361.35 10.68 FL ORANGE 1 *** 3613103 0186716 100 12/28/97 12/28/98 1 0.00 0.00 FL ORANGE 1 *** 3090167 0284988 900 12/28/97 12/28/98 1 0.00 0.00 FL ORANGE 1 *** 0038841 0271275 300 12/28/97 12/28/98 1 0.00 0.00 FL ORANGE 1 *** 3676334 0189884 402 03/01/97 03/01/98 1 531.25 0.00 FL ORANGE 1 *** 3014600 2160342 500 10/30/97 10/30/98 1 0.00 0.00 FL ORANGE 1 *** 2462851 0334219 701 03/10/97 03/10/98 1 760.00 0.00 FL ORANGE 1 *** 2222754 0251195 001 06/15/97 06/15/98 1 760.00 0.00
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RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) Effective 01/01/96 to 11/07/97 - --------- (SALES TAX INCL.) # OF PRODUCT FL & GA COUNTY NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. ANNIV. LEASE PRICE CUSTOMER AR DATE DATE YEARS BAL FL ORANGE 1 *** 2300535 2166016 405 02/10/97 02/10/98 1 0.00 0.00 FL ORANGE 1 *** 2255435 0358245 603 08/10/97 08/10/98 1 507.37 511.00 FL ORANGE 1 *** 2002419 2166143 504 06/10/97 06/10/98 1 380.00 0.00 FL ORANGE 1 *** 2011985 2166158 302 11/10/96 11/10/97 1 507.40 0.00 FL ORANGE 1 *** 3807695 2017783 000 06/30/97 06/30/98 1 817.00 0.00 FL ORANGE 1 *** 3342811 0208136 201 04/10/97 04/10/98 1 825.00 0.00 FL ORANGE 1 *** 2778633 0166475 402 09/10/97 09/10/98 1 760.00 823.96 FL ORANGE 1 *** 3388923 8278680 801 01/10/97 01/10/98 1 0.00 0.00 FL ORANGE 1 *** 2236904 0462048 203 02/16/97 02/16/98 1 760.00 0.00 FL ORANGE 1 *** 3627303 8433820 503 08/30/97 08/30/98 1 760.00 0.00 FL ORANGE 7 *** 3308736 8271275 100 12/30/97 12/30/98 1 0.00 0.00 FL PALM BEACH 1 *** 2337799 2123381 402 04/10/97 04/10/98 1 784.57 0.00 FL PALM BEACH 1 *** 2989020 0175906 300 08/10/97 08/10/98 1 784.57 835.77 FL PALM BEACH 1 *** 2012003 0462283 300 08/10/97 08/10/98 2 810.00 0.00 FL PALM BEACH 1 *** 2213082 0187409 408 05/10/97 05/10/98 1 1395.00 0.00 FL PALM BEACH 1 *** 2255727 2179313 400 05/01/97 05/01/98 1 784.58 689.82 FL PALM BEACH 1 *** 2300728 2151658 400 03/10/97 03/10/98 1 780.64 193.08 FL PALM BEACH 1 *** 2124016 2146279 401 04/01/97 04/01/98 1 523.05 0.00 FL PALM BEACH 1 *** 3192694 2020690 202 11/30/97 11/30/98 1 1260.00 1,360.60 FL PALM BEACH 1 *** 3449718 2002174 001 04/10/97 04/10/98 1 1095.00 0.00 FL PALM BEACH 1 *** 3576629 0375362 606 10/10/97 10/10/98 1 846.00 903.01 FL PALM BEACH 1 *** 3147416 8321927 801 01/10/98 01/10/99 1 1262.00 1,346.22 FL PALM BEACH 1 *** 3613103 0220272 100 04/28/97 04/28/98 1 0.00 0.00 FL PALM BEACH 1 *** 3616345 0408846 603 12/10/97 12/10/98 1 445.00 477.95 FL PALM BEACH 1 *** 3090167 0271317 100 12/28/97 12/28/98 1 0.00 0.00 FL PALM BEACH 1 *** 0038841 0271272 101 12/28/97 12/28/98 1 0.00 0.00 FL PALM BEACH 1 *** 2773504 0187423 402 08/10/97 08/10/98 1 392.29 0.00 FL PALM BEACH 1 *** 3014600 0179053 400 05/07/97 05/07/98 1 0.00 0.00 FL PALM BEACH 1 *** 3673115 0445335 401 07/01/97 07/01/98 1 1061.00 1,065.67 FL PALM BEACH 1 *** 2308416 2123376 402 05/05/97 05/05/98 1 413.34 (441.90) FL PALM BEACH 1 *** 3756964 2007364 202 08/01/97 08/01/98 1 480.00 71.67 FL PALM BEACH 1 *** 2210201 0263980 001 08/17/97 08/17/98 1 392.29 0.00 FL PALM BEACH 1 *** 3026283 8182450 203 02/28/97 02/28/98 1 1340.00 0.00
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RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) Effective 01/01/96 to 11/07/97 - --------- (SALES TAX INCL.) # OF PRODUCT FL & GA COUNTY NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. ANNIV. LEASE PRICE CUSTOMER AR DATE DATE YEARS BAL FL PALM BEACH 1 *** 3681790 0503384 303 08/28/97 08/28/97 1 0.00 0.00 FL PALM BEACH 1 *** 2003540 2179302 401 05/01/98 05/01/98 1 695.00 0.00 FL PALM BEACH 1 *** 2952051 0205845 302 11/10/98 11/10/98 1 978.65 1,043.12 FL PALM BEACH 1 *** 2709594 2015790 102 10/28/97 10/28/98 1 0.00 0.00 FL PALM BEACH 1 *** 2743938 2190126 402 05/19/97 05/19/98 1 1095.00 0.00 FL PALM BEACH 1 *** 3805068 2017709 001 06/30/97 06/30/98 1 1115.00 0.00 FL PALM BEACH 1 *** 2264402 0187465 401 06/10/97 06/10/98 1 1091.00 0.00 FL PALM BEACH 1 *** 2014881 2084351 301 04/25/97 04/25/98 1 694.20 0.00 FL PALM BEACH 1 *** 2162537 2002360 201 04/10/97 04/10/98 1 1095.00 0.00 FL PALM BEACH 1 *** 3722516 0386331 401 04/10/97 04/10/98 1 1095.00 0.00 FL PALM BEACH 1 *** 2309844 0176513 301 11/29/97 11/29/98 1 0.00 0.00 FL PALM BEACH 1 *** 3752427 2007221 203 06/30/97 06/30/98 1 0.00 0.00 FL PALM BEACH 1 *** 2795395 2017695 000 05/05/97 05/05/98 1 1095.00 638.24 FL PALM BEACH 8 *** 3308736 8271272 100 12/30/97 12/30/98 1 0.00 0.00 FL PINELLAS 1 *** 3409664 0304072 802 04/10/97 04/10/98 1 437.29 0.00 FL PINELLAS 1 *** 2174516 0208134 203 03/14/97 03/14/98 1 780.00 0.00 FL PINELLAS 1 *** 3613103 0949020 300 12/28/97 12/28/98 1 0.00 0.00 FL PINELLAS 1 *** 3229963 2028139 001 03/10/97 03/10/98 1 0.00 0.00 FL PINELLAS 1 *** 3031238 0213657 001 01/10/96 01/10/97 1 0.00 0.00 FL PINELLAS 1 *** 3090167 0271318 100 12/28/97 12/28/98 1 0.00 0.00 FL PINELLAS 1 *** 0038841 0271276 001 05/21/97 05/21/98 1 0.00 0.00 FL PINELLAS 1 *** 3676334 0189887 402 03/01/97 03/01/98 1 658.75 0.00 FL PINELLAS 1 *** 3014600 0187527 300 08/27/97 08/27/98 1 0.00 0.00 FL PINELLAS 1 *** 2124083 0187305 503 12/10/97 12/10/98 1 1345.00 1,464.15 FL PINELLAS 1 *** 3776654 2018317 100 03/12/97 03/12/98 1 1030.73 266.42 FL PINELLAS 1 *** 2016539 0226857 403 01/30/98 01/30/99 1 523.20 563.12 FL PINELLAS 1 *** 3729595 0459311 402 01/01/98 01/01/99 1 980.00 1,057.56 FL PINELLAS 1 *** 2811194 8160371 300 04/28/97 04/28/98 1 0.00 0.00 FL PINELLAS 1 *** 3120783 0322393 701 06/10/97 06/10/98 1 1170.00 0.00 FL PINELLAS 1 *** 3030022 2018268 100 02/21/97 02/21/98 1 721.50 0.00 FL PINELLAS 1 *** 2958732 0213317 301 05/10/97 05/10/98 1 1170.00 0.00 FL PINELLAS 8 *** 3308736 8271276 100 12/30/97 12/30/98 1 0.00 0.00 FL SARASOTA 1 *** 3613103 0220309 100 03/03/97 03/03/98 1 0.00 0.00
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RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) Effective 01/01/96 to 11/07/97 - --------- (SALES TAX INCL.) # OF PRODUCT FL & GA COUNTY NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. ANNIV. LEASE PRICE CUSTOMER AR DATE DATE YEARS BAL FL SARASOTA 1 *** 3090167 8258775 700 08/07/97 08/07/98 1 0.00 0.00 FL SARASOTA 1 *** 0038841 0271278 100 12/05/97 12/05/98 1 0.00 0.00 FL SARASOTA 1 *** 3014600 0207003 300 09/30/97 09/30/98 1 0.00 0.00 FL SARASOTA 1 *** 2518608 0277531 901 07/01/97 07/01/98 1 498.33 0.00 FL SARASOTA 1 *** 2904762 0187110 405 01/10/98 01/10/99 1 1650.00 1,664.08 FL SARASOTA 1 *** 2809562 0187630 304 02/25/97 02/25/98 1 260.10 56.04 FL SARASOTA 1 *** 2309233 2151773 402 05/10/97 05/10/98 1 0.00 0.00 FL SARASOTA 1 *** 2762195 2152231 402 03/10/97 03/10/98 1 1060.00 0.00 FL SARASOTA 2 *** 2309589 0179092 300 09/30/97 09/30/98 1 0.00 0.00 FL SARASOTA 7 *** 3308736 8271278 100 12/30/97 12/30/98 1 0.00 0.00 FL SEMINOLE 1 *** 2124016 2146276 402 03/01/97 03/01/98 1 760.00 0.00 FL SEMINOLE 1 *** 3707753 0452612 207 03/20/97 03/20/98 1 855.00 0.00 FL SEMINOLE 1 *** 3611447 2028502 101 07/30/97 07/30/98 1 0.00 0.00 FL SEMINOLE 1 *** 2281193 0358762 603 08/10/97 08/10/98 1 760.00 813.88 FL SEMINOLE 1 *** 3575860 0375272 502 05/03/97 05/03/98 1 760.00 0.00 FL SEMINOLE 1 *** 2525859 0277344 801 11/17/96 11/17/97 1 0.00 0.00 FL SEMINOLE 1 *** 2524650 2166169 400 06/10/97 06/10/98 1 442.50 0.00 FL SEMINOLE 1 *** 2782298 0166395 403 10/10/97 10/10/98 1 875.00 936.97 FL SEMINOLE 1 *** 2972778 0211710 201 11/10/97 11/10/98 1 389.40 0.00 FL SEMINOLE 1 *** 2743297 0166487 401 09/10/97 09/10/98 1 389.40 280.52 FL SEMINOLE 1 *** 3613103 0304031 800 05/24/97 05/24/98 1 0.00 0.00 FL SEMINOLE 1 *** 3090167 0271322 100 12/28/97 12/28/98 1 0.00 0.00 FL SEMINOLE 1 *** 0038841 8259978 100 08/27/97 08/27/98 1 0.00 0.00 FL SEMINOLE 1 *** 2323260 0166367 401 06/10/97 06/10/98 1 760.00 0.00 FL SEMINOLE 1 *** 3676334 0189886 403 03/01/97 03/01/98 1 376.25 0.00 FL SEMINOLE 1 *** 2462851 0334223 701 03/10/97 03/10/98 1 760.00 0.00 FL SEMINOLE 1 *** 2337894 0166322 307 07/10/96 07/10/97 1 0.00 0.00 FL SEMINOLE 1 *** 2222754 0297000 900 12/10/97 12/10/98 1 0.00 0.00 FL SEMINOLE 1 *** 2300535 2166017 403 02/10/97 02/10/98 1 0.00 0.00 FL SEMINOLE 1 *** 2723769 2166163 302 02/10/97 02/10/98 1 256.25 0.00 FL SEMINOLE 1 *** 2002419 2166142 402 06/10/97 06/10/98 1 760.00 0.00 FL SEMINOLE 1 *** 2011985 2166159 401 04/10/97 04/10/98 1 0.00 0.00 FL SEMINOLE 1 *** 3807695 2017781 000 06/30/97 06/30/98 1 812.25 0.00
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(Sales tax incl.) COUNTY # OF FL & GA ST NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. DATE ANNIV. DATE LEASE PRODUCT Customer AR YEARS PRICE Bal FL SEMINOLE 1 *** 3342811 0208135 101 02/24/97 02/24/98 1 760.00 0.00 FL SEMINOLE 1 *** 2778633 0166474 402 09/10/97 09/10/98 1 1210.00 1,311.10 FL SEMINOLE 1 *** 3388923 0278681 803 11/29/96 11/29/97 1 0.00 0.00 FL SEMINOLE 1 *** 2233194 2152171 600 12/28/97 12/28/98 1 0.00 0.00 FL SEMINOLE 1 *** 2236904 0462048 202 02/16/97 02/16/98 1 1089.00 0.00 FL SEMINOLE 1 *** 3627303 8433820 502 08/30/97 08/30/98 1 1210.00 0.00 FL SEMINOLE 2 *** 2915683 2014759 200 10/18/97 10/18/98 1 0.00 0.00 FL SEMINOLE 7 *** 3308736 9259978 100 12/30/97 12/30/98 1 0.00 0.00 FL VOLUSIA 1 *** 2124016 0172866 401 10/10/96 10/10/97 1 541.00 0.00 FL VOLUSIA 1 *** 2281193 2125452 402 09/10/97 09/10/98 1 522.23 557.41 FL VOLUSIA 1 *** 3158120 2166170 402 08/10/97 08/10/98 1 522.23 557.69 FL VOLUSIA 1 *** 3613103 0320883 800 12/10/97 12/10/98 1 0.00 0.00 FL VOLUSIA 1 *** 3090167 0258778 000 08/07/97 08/07/98 1 0.00 0.00 FL VOLUSIA 1 *** 0038841 0271279 100 12/05/97 12/05/98 1 0.00 0.00 FL VOLUSIA 1 *** 3676334 2156449 502 03/01/97 03/01/98 1 825.00 0.00 FL VOLUSIA 1 *** 3014600 0127775 400 06/15/97 06/15/98 1 0.00 0.00 FL VOLUSIA 1 *** 2462851 0334224 701 03/10/97 03/10/98 1 910.00 0.00 FL VOLUSIA 1 *** 3040304 0208283 101 04/10/96 04/10/97 1 0.00 0.00 FL VOLUSIA 1 *** 3690996 2018481 101 03/01/97 03/01/98 1 720.38 228.18 FL VOLUSIA 1 *** 3512676 2156317 501 01/10/98 01/10/99 1 990.00 1,055.74 FL VOLUSIA 2 *** 2915683 2014758 200 10/13/97 10/13/98 1 0.00 0.00 FL VOLUSIA 7 *** 3308736 8271279 100 12/30/97 12/30/98 1 0.00 0.00 GA CHEROKEE 1 *** 3098778 0232104 200 01/10/98 01/10/99 1 0.00 0.00 GA CHEROKEE 1 *** 2925677 0351712 601 09/30/97 09/30/98 1 232.65 246.61 GA CHEROKEE 1 *** 3214266 3161878 304 06/15/96 12/15/97 1 171.00 0.00 GA CHEROKEE 1 *** 3542075 0453849 301 03/15/97 03/15/98 1 202.50 0.00 GA CHEROKEE 1 *** 3418200 3161740 402 08/18/97 08/18/98 1 163.20 123.08 GA CHEROKEE 1 *** 3571383 0453856 212 07/28/96 07/28/97 1 133.00 0.00 GA CHEROKEE 1 *** 3271724 0247892 919 02/25/97 02/25/98 1 85.50 36.25 GA CHEROKEE 1 *** 3090167 0271313 100 12/28/97 12/28/98 1 0.00 0.00 GA CHEROKEE 1 *** 3091641 0242872 100 12/28/97 12/28/98 1 0.00 0.00 GA CHEROKEE 1 *** 3345302 0354890 702 02/10/98 02/10/99 1 187.85 201.71 GA CHEROKEE 1 *** 3758218 2001659 205 08/21/97 08/21/98 1 91.80 0.00 Data as of 11/07/97 Page 10 11/20/97
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97
(Sales tax incl.) # OF FL & GA COUNTY LEASE PRODUCT Customer AR ST NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. DATE ANNIV. DATE YEARS PRICE Bal GA CHEROKEE 1 *** 3606067 0394443 500 04/10/97 04/10/98 1 405.00 0.00 GA CHEROKEE 1 *** 3224573 0345482 726 01/16/98 01/16/99 1 465.00 497.55 GA CHEROKEE 1 *** 3688960 2008478 200 10/26/97 10/26/98 1 311.85 336.11 GA CHEROKEE 1 *** 3463866 0374898 616 12/31/97 12/31/98 1 250.00 267.50 GA CHEROKEE 1 *** 3026551 2018656 000 10/23/97 10/23/98 1 209.37 232.85 GA CHEROKEE 1 *** 3811786 2021209 002 09/18/97 09/18/98 1 243.75 234.73 GA CHEROKEE 1 *** 3707720 8355277 637 04/10/97 04/10/98 1 176.17 92.49 GA CHEROKEE 1 *** 3564183 8353721 601 06/17/97 06/17/98 1 127.71 0.00 GA CHEROKEE 1 *** 3219861 0248564 921 01/01/97 01/01/98 1 0.00 0.00 GA CHEROKEE 1 *** 3219861 0248564 921 01/01/97 01/01/98 1 195.75 0.00 GA CHEROKEE 1 *** 3012086 0228496 101 06/14/97 06/14/98 1 405.00 450.98 GA CHEROKEE 1 *** 3012075 0314749 795 08/01/97 08/01/98 1 217.50 56.08 GA CHEROKEE 1 *** 3012075 0314749 913 08/01/97 08/01/98 1 143.55 153.60 GA CHEROKEE 1 *** 3012075 0314749 928 08/01/97 08/01/98 1 405.00 433.35 GA CHEROKEE 1 *** 3012075 0314749 953 08/01/97 08/01/98 1 232.65 248.94 GA CHEROKEE 1 *** 3331688 3161588 332 02/01/97 02/01/98 1 405.00 128.79 GA CHEROKEE 1 *** 3731493 0462489 302 11/22/97 11/22/98 1 440.00 479.65 GA CHEROKEE 1 *** 3778944 2022340 100 04/05/97 04/05/98 1 237.50 0.00 GA CHEROKEE 1 *** 3513240 3161658 438 11/12/97 11/12/98 1 182.32 195.08 GA CHEROKEE 1 *** 3751745 9414194 300 09/12/97 09/12/98 1 405.00 0.00 GA CHEROKEE 1 *** 3103692 2038893 100 06/26/97 06/26/98 1 175.00 33.75 GA CHEROKEE 1 *** 3419058 0196126 400 01/29/98 01/29/99 1 166.00 179.25 GA CHEROKEE 1 *** 3804517 2017754 000 05/12/97 05/12/98 1 237.50 139.15 GA CHEROKEE 8 *** 3308736 8242872 100 12/30/97 12/30/98 1 0.00 0.00 GA CITY ATLANTA 1 *** 3098778 0232104 201 01/10/98 01/10/99 1 0.00 0.00 GA CITY ATLANTA 1 *** 3214266 3146302 250 11/08/97 11/08/98 1 580.00 0.00 GA CITY ATLANTA 1 *** 3802962 3130263 503 07/10/97 07/10/98 1 360.00 0.00 GA CITY ATLANTA 1 *** 2925769 0345525 700 02/15/98 02/15/99 1 580.00 643.25 GA CITY ATLANTA 1 *** 3090167 8244453 000 06/25/97 06/25/98 1 0.00 0.00 GA CITY ATLANTA 1 *** 0038841 0242871 100 12/28/97 12/28/98 1 0.00 0.00 GA CITY ATLANTA 1 *** 3124505 3151856 500 11/30/97 11/30/98 1 0.00 0.00 GA CITY ATLANTA 1 *** 3219861 0248564 020 01/01/97 01/01/98 1 0.00 0.00 GA CITY ATLANTA 1 *** 3219861 0248564 020 01/01/97 01/01/98 1 324.00 0.00 Data as of 11/07/97 Page 11 11/20/97
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97
(Sales tax incl.) # OF FL & GA COUNTY LEASE PRODUCT Customer AR ST NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. DATE ANNIV. DATE YEARS PRICE Bal GA CITY ATLANTA 1 *** 3012075 0341749 800 08/01/97 08/01/98 1 505.00 540.35 GA CITY ATLANTA 1 *** 3619689 0424326 401 03/15/97 03/15/98 1 275.00 310.19 GA CITY ATLANTA 4 *** 3313101 3151857 500 01/28/98 01/28/99 1 0.00 0.00 GA CITY ATLANTA 5 *** 3308736 8242871 100 12/30/97 12/30/98 1 0.00 0.00 GA CLAYTON 1 *** 3098778 0232104 202 01/10/98 01/10/99 1 0.00 0.00 GA CLAYTON 1 *** 3214266 3146302 410 06/15/97 06/15/98 1 169.13 180.97 GA CLAYTON 1 *** 3542075 0351789 616 03/15/97 03/15/98 1 202.50 0.00 GA CLAYTON 1 *** 3257111 0187507 300 08/27/97 08/27/98 1 0.00 0.00 GA CLAYTON 1 *** 3552728 3151863 500 01/28/98 01/28/99 1 0.00 0.00 GA CLAYTON 1 *** 3255894 0260383 000 07/28/97 07/28/98 1 0.00 0.00 GA CLAYTON 1 *** 3271724 0310394 702 02/25/97 02/25/98 1 78.19 4.61 GA CLAYTON 1 *** 3268438 3146403 427 07/10/97 07/10/98 1 224.25 0.00 GA CLAYTON 1 *** 3803769 2028078 001 04/25/97 04/25/98 1 217.82 0.00 GA CLAYTON 1 *** 3090167 0320887 800 12/28/97 12/28/98 1 0.00 0.00 GA CLAYTON 1 *** 3609938 0454616 301 07/05/97 07/05/98 1 0.00 0.00 GA CLAYTON 1 *** 0038841 0242869 100 12/28/97 12/28/98 1 0.00 0.00 GA CLAYTON 1 *** 3259865 2028115 000 06/16/97 06/16/98 1 165.59 107.00 GA CLAYTON 1 *** 3758218 2001659 202 08/21/97 08/21/98 1 91.80 0.00 GA CLAYTON 1 *** 3679843 0426737 410 08/26/97 08/26/98 1 285.45 5.93 GA CLAYTON 1 *** 3123746 0229033 100 09/19/97 09/19/98 1 169.12 181.56 GA CLAYTON 1 *** 3331677 3146390 409 06/15/97 06/15/98 1 405.00 0.00 GA CLAYTON 1 *** 3463866 0374898 614 12/31/97 12/31/98 1 295.00 315.65 GA CLAYTON 1 *** 3707720 8355277 632 04/10/97 04/10/98 1 212.77 92.44 GA CLAYTON 1 *** 2970864 0348990 607 04/30/97 04/30/98 1 185.55 0.00 GA CLAYTON 1 *** 3219861 0248564 019 01/01/97 01/01/98 1 0.00 0.00 GA CLAYTON 1 *** 3219861 0248564 019 01/01/97 01/01/98 1 230.62 0.00 GA CLAYTON 1 *** 3488261 0341605 701 03/10/97 03/10/98 1 149.55 0.00 GA CLAYTON 1 *** 3012075 0341749 952 08/01/97 08/01/98 1 285.45 305.43 GA CLAYTON 1 *** 3331688 3161588 335 02/01/97 02/01/98 1 405.00 0.00 GA CLAYTON 1 *** 3513240 3161658 437 11/12/97 11/12/98 1 194.70 208.33 GA CLAYTON 1 *** 3396814 0341772 802 09/12/97 09/12/98 1 256.25 278.25 GA CLAYTON 1 *** 3019988 0181514 155 05/10/97 05/10/98 1 405.00 429.30 GA CLAYTON 1 *** 3600049 0383560 515 03/01/97 03/01/98 1 405.00 460.10 Data as of 11/07/97 Page 12 11/20/97
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97
(Sales tax incl.) # OF FL & GA COUNTY LEASE PRODUCT Customer AR ST NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. DATE ANNIV. DATE YEARS PRICE Bal GA CLAYTON 1 *** 3697683 0503835 301 03/01/97 03/01/98 1 405.00 0.00 GA CLAYTON 5 *** 3308736 8242869 100 12/30/97 12/30/98 1 0.00 0.00 GA COBB 1 *** 3098778 0232104 203 01/10/98 01/10/99 1 0.00 0.00 GA COBB 1 *** 3214266 3146302 407 06/15/97 06/15/98 1 169.13 180.97 GA COBB 1 *** 3480869 0438768 506 12/16/97 12/16/98 1 465.00 497.55 GA COBB 1 *** 3542075 0351789 615 03/15/97 03/15/98 1 202.50 0.00 GA COBB 1 *** 3418200 3161740 403 08/18/97 08/18/98 1 189.55 142.44 GA COBB 1 *** 3611513 0394437 502 06/01/97 06/01/98 1 169.13 73.53 GA COBB 1 *** 3583403 0375456 603 12/10/97 12/10/98 1 465.00 514.50 GA COBB 1 *** 3418211 0498050 300 05/23/97 05/23/98 1 0.00 0.00 GA COBB 1 *** 3519758 0341694 625 07/10/97 07/10/98 1 218.76 0.00 GA COBB 1 *** 3571383 0453856 209 07/28/96 07/28/97 1 156.62 0.00 GA COBB 1 *** 3271724 0247892 917 02/25/97 02/25/98 1 102.94 43.65 GA COBB 1 *** 3268438 3146403 423 07/10/97 07/10/98 1 132.90 0.00 GA COBB 1 *** 3722044 0462403 300 08/17/97 08/17/98 1 256.25 0.00 GA COBB 1 *** 3090167 0320889 800 12/28/97 12/28/98 1 0.00 0.00 GA COBB 1 *** 3609938 0454616 302 07/05/97 07/05/98 1 0.00 0.00 GA COBB 1 *** 3565748 0379272 500 07/01/97 07/01/98 1 405.00 0.00 GA COBB 1 *** 3345302 2066907 000 05/17/97 05/17/98 1 405.00 0.00 GA COBB 1 *** 3758218 2001659 302 08/21/97 08/21/98 1 89.10 0.00 GA COBB 1 *** 2938435 0204210 402 02/27/98 02/27/99 1 253.00 271.18 GA COBB 1 *** 3593420 9418835 200 05/19/97 05/19/98 1 405.00 0.00 GA COBB 1 *** 3021277 0213199 202 12/31/97 12/31/98 1 465.00 488.25 GA COBB 1 *** 3009763 0213146 205 08/15/97 08/15/98 1 256.25 222.60 GA COBB 1 *** 3224573 0345482 715 08/15/97 08/15/98 1 285.45 305.43 GA COBB 1 *** 3331677 3146390 408 06/15/97 06/15/98 1 405.00 0.00 GA COBB 1 *** 3348990 3161699 328 08/31/97 08/31/98 1 285.45 0.00 GA COBB 1 *** 3463866 0374898 615 12/31/97 12/31/98 1 295.00 315.65 GA COBB 1 *** 3026551 0341738 712 05/28/97 05/28/98 1 239.23 255.98 GA COBB 1 *** 3052192 0206739 209 08/10/97 08/10/98 1 256.25 183.75 GA COBB 1 *** 3707720 8355277 633 04/10/97 04/10/98 1 212.77 111.71 GA COBB 1 *** 3500565 3161626 300 04/10/97 04/10/98 1 189.55 0.00 GA COBB 1 *** 3279685 8250635 002 09/10/97 09/10/98 1 405.00 0.00 Data as of 11/07/97 Page 13 11/20/97
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97
(Sales tax incl.) # OF FL & GA COUNTY LEASE PRODUCT Customer AR ST NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. DATE ANNIV. DATE YEARS PRICE Bal GA COBB 1 *** 3564183 0353716 601 06/17/97 06/17/98 1 170.33 0.00 GA COBB 1 *** 2970864 0348990 608 04/30/97 04/30/98 1 185.55 108.70 GA COBB 1 *** 3219861 0248564 018 01/01/97 01/01/98 1 0.00 0.00 GA COBB 1 *** 3219861 0248564 018 01/01/97 01/01/98 1 230.62 0.00 GA COBB 1 *** 3318117 0330923 713 10/20/97 10/20/98 1 237.50 280.88 GA COBB 1 *** 3318117 0330923 714 06/10/97 06/10/98 1 0.00 0.00 GA COBB 1 *** 3012086 3146369 407 06/14/97 06/14/98 1 405.00 429.30 GA COBB 1 *** 3475593 2022446 100 04/03/97 04/03/98 1 403.75 0.47 GA COBB 1 *** 3012075 0341749 863 08/01/97 08/01/98 1 169.13 180.97 GA COBB 1 *** 3012075 0341749 895 08/01/97 08/01/98 1 142.73 149.87 GA COBB 1 *** 3012075 0341749 939 08/01/97 08/01/98 1 169.12 177.58 GA COBB 1 *** 3012075 0341749 949 08/01/97 08/01/98 1 285.44 305.42 GA COBB 1 *** 3517363 0345474 706 10/01/97 10/01/98 1 133.93 0.00 GA COBB 1 *** 3331688 3161588 336 02/01/97 02/01/98 1 405.00 0.00 GA COBB 1 *** 3052170 8353776 602 04/10/97 04/10/98 1 189.55 0.00 GA COBB 1 *** 3144237 0453886 301 07/28/97 07/28/98 1 256.25 0.00 GA COBB 1 *** 3632576 0386193 402 10/06/96 10/06/97 1 0.00 0.00 GA COBB 1 *** 3513240 3161658 441 11/12/97 11/12/98 1 212.02 226.86 GA COBB 1 *** 3212978 3146307 327 09/10/96 09/10/97 1 205.00 99.36 GA COBB 1 *** 3396814 0345472 702 09/12/97 09/12/98 1 256.25 278.25 GA COBB 1 *** 3646436 0433775 505 02/10/98 02/10/99 1 328.35 360.16 GA COBB 1 *** 3103692 0227047 201 12/23/96 12/23/97 1 256.90 0.00 GA COBB 1 *** 3812985 2027006 000 10/08/97 10/08/98 1 273.11 298.92 GA COBB 1 *** 3600049 0383560 516 03/01/97 03/01/98 1 405.00 433.35 GA COBB 2 *** 3091641 0242870 100 12/28/97 12/28/98 1 0.00 0.00 GA COBB 5 *** 3308736 8242870 100 12/30/97 12/30/98 1 0.00 0.00 GA COBB 12 *** 3550988 0238044 001 05/15/97 05/15/98 1 0.00 0.00 GA COWETA 1 *** 3214266 0438734 300 06/15/97 06/15/98 1 380.00 0.00 GA COWETA 1 *** 3090167 0439830 400 08/30/97 08/30/98 1 0.00 0.00 GA COWETA 1 *** 3609938 0439782 200 10/24/97 10/24/98 1 0.00 0.00 GA COWETA 1 *** 0038841 0031247 216 01/30/98 01/30/99 1 0.00 0.00 GA COWETA 1 *** 3091641 0454176 300 10/17/97 10/17/98 1 0.00 0.00 GA COWETA 1 *** 3219861 0248564 021 01/01/97 01/01/98 1 0.00 0.00 Data as of 11/07/97 Page 14 11/20/97
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97
(Sales tax incl.) # OF FL & GA COUNTY LEASE PRODUCT Customer AR ST NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. DATE ANNIV. DATE YEARS PRICE Bal GA COWETA 1 *** 3219861 0248564 021 01/01/97 01/01/98 1 342.00 0.00 GA COWETA 1 *** 3552919 0378967 301 10/17/97 10/17/98 1 440.00 480.62 GA COWETA 1 *** 3019988 0181514 130 08/15/97 08/15/98 1 380.00 402.80 GA DEKALB 1 *** 3098778 0232104 204 01/10/98 01/10/99 1 0.00 0.00 GA DEKALB 1 *** 3214266 3146302 408 06/15/97 06/15/98 1 169.13 180.97 GA DEKALB 1 *** 3480869 0438768 507 12/16/97 12/16/98 1 465.00 497.55 GA DEKALB 1 *** 3542075 0351789 617 03/15/97 03/15/98 1 202.50 0.00 GA DEKALB 1 *** 3519758 0341694 623 07/10/97 07/10/98 1 218.76 0.00 GA DEKALB 1 *** 3571383 0453856 210 07/28/96 07/28/97 1 156.62 0.00 GA DEKALB 1 *** 3271724 0247892 918 02/27/97 02/27/98 1 102.94 23.31 GA DEKALB 1 *** 3268438 3146403 422 07/10/97 07/10/98 1 132.90 0.00 GA DEKALB 1 *** 3291115 3161572 401 06/25/97 06/25/98 1 475.00 486.10 GA DEKALB 1 *** 3219849 3146407 403 06/25/97 06/25/98 1 189.55 0.00 GA DEKALB 1 *** 3803769 2028078 002 04/25/97 04/25/98 1 217.81 0.00 GA DEKALB 1 *** 3090167 0320890 800 12/28/97 12/28/98 1 0.00 0.00 GA DEKALB 1 *** 3609938 0454616 304 07/05/97 07/05/98 1 0.00 0.00 GA DEKALB 1 *** 0038841 0242862 100 12/28/97 12/28/98 1 0.00 0.00 GA DEKALB 1 *** 3796357 2018740 101 12/20/97 12/20/98 1 0.00 0.00 GA DEKALB 1 *** 3565748 0379272 511 07/01/97 07/01/98 1 405.00 252.72 GA DEKALB 1 *** 3758218 2001659 201 08/21/97 08/21/98 1 95.20 0.00 GA DEKALB 1 *** 3331677 3146390 407 06/15/97 06/15/98 1 405.00 433.35 GA DEKALB 1 *** 3348990 3161699 326 08/31/97 08/31/98 1 285.45 0.00 GA DEKALB 1 *** 3463866 0374898 617 12/31/97 12/31/98 1 295.00 315.65 GA DEKALB 1 *** 3026551 0341738 615 05/28/97 05/28/98 1 235.22 251.69 GA DEKALB 1 *** 3707720 8355277 634 04/10/97 04/10/98 1 212.77 111.71 GA DEKALB 1 *** 2970864 0348990 609 04/30/97 04/30/98 1 185.55 116.91 GA DEKALB 1 *** 3219861 0248564 015 01/01/97 01/01/98 1 0.00 0.00 GA DEKALB 1 *** 3219861 0248564 015 01/01/97 01/01/98 1 230.62 0.00 GA DEKALB 1 *** 3318117 0330923 705 06/10/97 06/10/98 1 0.00 0.00 GA DEKALB 1 *** 3012086 3146369 406 06/14/97 06/14/98 1 405.00 429.30 GA DEKALB 1 *** 3475593 2022446 101 04/03/97 04/03/98 1 403.75 169.60 GA DEKALB 1 *** 3266735 0351843 610 04/10/97 04/10/98 1 154.28 108.00 GA DEKALB 1 *** 3012075 0341749 950 08/01/97 08/01/98 1 285.45 305.43 Data as of 11/07/97 Page 15 11/20/97
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97
(Sales tax incl.) # OF FL & GA COUNTY LEASE PRODUCT Customer AR ST NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. DATE ANNIV. DATE YEARS PRICE Bal GA DEKALB 1 *** 3517363 0345474 711 10/01/97 10/01/98 1 133.97 0.00 GA DEKALB 1 *** 3331688 3161588 337 02/01/97 02/01/98 1 405.00 0.00 GA DEKALB 1 *** 3144237 0358131 604 06/14/97 06/14/98 1 256.25 0.00 GA DEKALB 1 *** 3513240 3161658 440 11/12/97 11/12/98 1 194.70 208.33 GA DEKALB 1 *** 3212978 2008643 101 09/10/96 09/10/97 1 205.00 22.39 GA DEKALB 1 *** 3396814 0291044 800 09/12/97 09/12/98 1 256.25 278.25 GA DEKALB 1 *** 3019988 0181514 156 05/10/97 05/10/98 1 405.00 429.30 GA DEKALB 1 *** 3646436 2008639 200 07/27/97 07/27/98 1 405.00 0.00 GA DEKALB 5 *** 3308736 8242862 100 12/30/97 12/30/98 1 0.00 0.00 GA DOUGLAS 1 *** 3098778 0232104 205 01/10/98 01/10/99 1 0.00 0.00 GA DOUGLAS 1 *** 3214266 3161878 405 06/15/97 06/15/98 1 132.83 142.13 GA DOUGLAS 1 *** 3611513 0394437 503 06/01/97 06/01/98 1 132.83 139.47 GA DOUGLAS 1 *** 3571383 0453856 213 07/28/96 07/28/97 1 122.50 0.00 GA DOUGLAS 1 *** 3271724 0247892 920 02/27/97 02/27/98 1 78.19 4.61 GA DOUGLAS 1 *** 3268438 3146403 425 07/10/97 07/10/98 1 103.95 0.00 GA DOUGLAS 1 *** 3425875 8172794 400 06/10/97 06/10/98 1 0.00 0.00 GA DOUGLAS 1 *** 3090167 0320891 800 12/28/97 12/28/98 1 0.00 0.00 GA DOUGLAS 1 *** 3609938 3161712 400 04/28/97 04/28/98 1 0.00 0.00 GA DOUGLAS 1 *** 0038841 0242868 100 12/28/97 12/28/98 1 0.00 0.00 GA DOUGLAS 1 *** 3758218 2001659 206 08/21/97 08/21/98 1 91.80 0.00 GA DOUGLAS 1 *** 3009763 0213146 206 08/15/97 08/15/98 1 201.25 170.66 GA DOUGLAS 1 *** 3026551 0341738 714 05/28/97 05/28/98 1 211.20 225.98 GA DOUGLAS 1 *** 3707720 8355277 640 04/10/97 04/10/98 1 163.01 85.59 GA DOUGLAS 1 *** 3564183 0353722 601 06/17/97 06/17/98 1 136.94 0.00 GA DOUGLAS 1 *** 3219861 0248564 922 01/01/97 01/01/98 1 0.00 0.00 GA DOUGLAS 1 *** 3219861 0248564 922 01/01/97 01/01/98 1 181.12 0.00 GA DOUGLAS 1 *** 3012075 0341749 955 08/01/97 08/01/98 1 211.20 225.98 GA DOUGLAS 1 *** 3331688 0302429 702 02/01/97 02/01/98 1 380.00 0.00 GA DOUGLAS 1 *** 3761465 2008428 200 09/13/97 09/13/98 1 201.25 0.00 GA DOUGLAS 1 *** 3812985 2027006 001 10/08/97 10/08/98 1 273.11 292.23 GA DOUGLAS 8 *** 3308736 8242868 100 12/30/97 12/30/98 1 0.00 0.00 GA FAYETTE 1 *** 3098778 0232104 206 01/10/98 01/10/99 1 0.00 0.00 GA FAYETTE 1 *** 3214266 3146302 411 06/15/97 06/15/98 1 132.83 142.13 Data as of 11/07/97 Page 16 11/20/97
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97
(Sales tax incl.) # OF FL & GA COUNTY LEASE PRODUCT Customer ST NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. DATE ANNIV. DATE YEARS PRICE Bal GA FAYETTE 1 *** 3237511 0341742 702 07/14/97 07/14/98 1 211.20 0.00 GA FAYETTE 1 *** 3102053 0228441 200 02/10/98 02/10/99 1 231.25 249.38 GA FAYETTE 1 *** 3701362 0454303 301 04/01/97 04/01/98 1 201.25 0.00 GA FAYETTE 1 *** 2304924 3161571 404 05/15/97 05/15/98 1 167.90 0.00 GA FAYETTE 1 *** 3090167 0320893 800 12/28/97 12/28/98 1 0.00 0.00 GA FAYETTE 1 *** 0038841 0242866 100 12/28/97 12/28/98 1 0.00 0.00 GA FAYETTE 1 *** 3259865 2028115 001 06/16/97 06/16/98 1 132.45 83.45 GA FAYETTE 1 *** 3758218 2001659 207 08/21/97 08/21/98 1 91.80 0.00 GA FAYETTE 1 *** 3679843 0426737 408 08/10/97 08/10/98 1 211.20 0.00 GA FAYETTE 1 *** 3707720 8355277 638 04/10/97 04/10/98 1 163.01 85.59 GA FAYETTE 1 *** 3219861 0248564 926 01/01/97 01/01/98 1 0.00 0.00 GA FAYETTE 1 *** 3219861 0248564 926 01/01/97 01/01/98 1 181.12 0.00 GA FAYETTE 1 *** 3552919 3161301 400 04/10/97 04/10/98 1 132.80 0.00 GA FAYETTE 1 *** 3012075 0341749 956 08/01/97 08/01/98 1 211.20 225.98 GA FAYETTE 1 *** 3721160 3161359 403 12/10/97 12/10/98 1 152.63 164.59 GA FAYETTE 1 *** 3331688 3161588 330 02/01/97 02/01/98 1 380.00 120.84 GA FAYETTE 1 *** 3513240 3161658 439 11/12/97 11/12/98 1 152.62 163.30 GA FAYETTE 1 *** 3019988 0181514 157 05/10/97 05/10/98 1 380.00 402.80 GA FAYETTE 8 *** 3308736 8242866 100 12/30/97 12/30/98 1 0.00 0.00 GA FORSYTH 1 *** 3098778 0232104 207 01/10/98 01/10/99 1 0.00 0.00 GA FORSYTH 1 *** 2925677 0351712 612 09/30/97 09/30/98 1 211.20 223.87 GA FORSYTH 1 *** 3214266 3161878 415 06/15/97 06/15/98 1 211.20 225.98 GA FORSYTH 1 *** 3780079 0351786 600 04/19/97 04/19/98 1 380.00 0.00 GA FORSYTH 1 *** 3121458 0452391 202 01/17/96 01/17/97 1 0.00 0.00 GA FORSYTH 1 *** 3645833 0433758 506 01/15/98 01/15/99 1 231.25 247.44 GA FORSYTH 1 *** 3542075 0453934 301 03/15/97 03/15/98 1 190.00 0.00 GA FORSYTH 1 *** 3812084 2027009 001 09/26/97 09/26/98 1 221.13 0.00 GA FORSYTH 1 *** 3271724 0247892 921 02/27/97 02/27/98 1 79.50 0.00 GA FORSYTH 1 *** 3533619 0345394 612 05/01/97 05/01/98 1 0.00 0.00 GA FORSYTH 1 *** 3268438 3146403 426 07/10/97 07/10/98 1 103.95 0.00 GA FORSYTH 1 *** 3397084 0435407 400 04/12/97 04/12/98 1 190.08 0.00 GA FORSYTH 1 *** 3090167 0320894 800 12/28/97 12/28/98 1 0.00 0.00 GA FORSYTH 1 *** 0038841 0242883 100 12/28/97 12/28/98 1 0.00 0.00 Data as of 11/07/97 Page 17 11/20/97
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97
(Sales tax incl.) # OF FL & GA COUNTY LEASE PRODUCT Customer ST NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. DATE ANNIV. DATE YEARS PRICE Bal GA FORSYTH 1 *** 3796357 2018740 102 12/20/97 12/20/98 1 0.00 0.00 GA FORSYTH 1 *** 3758218 2001659 208 09/20/97 09/20/98 1 101.20 0.00 GA FORSYTH 1 *** 3538953 0349640 608 06/04/97 06/04/98 1 380.00 0.00 GA FORSYTH 1 *** 3224573 0345482 727 01/30/98 01/30/99 1 260.00 299.60 GA FORSYTH 1 *** 3348990 3161699 415 08/31/97 08/31/98 1 211.20 21.53 GA FORSYTH 1 *** 3026551 0341738 713 05/28/97 05/28/98 1 179.32 191.87 GA FORSYTH 1 *** 3811786 2021209 003 09/18/97 09/18/98 1 227.50 219.08 GA FORSYTH 1 *** 3707720 8355277 641 04/10/97 04/10/98 1 172.80 90.72 GA FORSYTH 1 *** 2970864 0348990 610 04/30/97 04/30/98 1 172.30 108.56 GA FORSYTH 1 *** 3539938 0355268 621 09/15/97 09/15/98 1 211.20 232.62 GA FORSYTH 1 *** 3219861 0248564 920 01/01/97 01/01/98 1 0.00 0.00 GA FORSYTH 1 *** 3219861 0248564 920 01/01/97 01/01/98 1 181.12 0.00 GA FORSYTH 1 *** 3012086 0205769 302 06/14/97 06/14/98 1 380.00 402.80 GA FORSYTH 1 *** 3266735 0351843 612 04/10/97 04/10/98 1 117.98 82.59 GA FORSYTH 1 *** 3012075 0341749 865 08/01/97 08/01/98 1 132.83 142.13 GA FORSYTH 1 *** 3012075 0341749 957 08/01/97 08/01/98 1 132.83 142.13 GA FORSYTH 1 *** 3012075 2000764 201 08/01/97 08/01/98 1 211.20 223.87 GA FORSYTH 1 *** 3012075 2013809 100 11/02/96 11/02/97 1 380.00 406.60 GA FORSYTH 1 *** 3774300 2020615 200 02/08/98 02/08/99 1 520.00 583.15 GA FORSYTH 1 *** 3331688 3161588 329 02/01/97 02/01/98 1 380.00 120.84 GA FORSYTH 1 *** 3746385 9414173 200 04/07/97 04/07/98 1 380.00 0.00 GA FORSYTH 1 *** 3513240 2022494 100 08/08/97 08/08/98 1 380.00 0.00 GA FORSYTH 1 *** 3751745 9414194 200 04/10/97 04/10/98 1 380.00 0.00 GA FORSYTH 1 *** 3588068 0379210 603 02/02/98 02/02/99 1 244.20 258.85 GA FORSYTH 1 *** 3103692 2008741 100 12/04/96 12/04/97 1 175.00 133.85 GA FORSYTH 1 *** 3475526 3161745 402 09/10/97 09/10/98 1 0.00 0.00 GA FORSYTH 1 *** 3429460 0351793 601 06/15/97 06/15/98 1 190.08 0.00 GA FORSYTH 8 *** 3308736 8242883 400 12/30/97 12/30/98 1 0.00 0.00 GA FULTON 1 *** 3214266 3146302 406 06/15/97 06/15/98 1 246.67 268.35 GA FULTON 1 *** 3680238 0426742 422 11/05/97 11/05/98 1 520.00 583.15 GA FULTON 1 *** 3480869 0324237 802 12/16/97 12/16/98 1 705.00 781.10 GA FULTON 1 *** 3220823 3161872 402 06/15/97 06/15/98 1 404.25 0.00 GA FULTON 1 *** 3271724 0247892 915 02/27/97 02/27/98 1 126.56 0.00 Data as of 11/07/97 Page 18 11/20/97
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97
(Sales tax incl.) # OF FL & GA COUNTY LEASE PRODUCT Customer ST NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. DATE ANNIV. DATE YEARS PRICE Bal GA FULTON 1 *** 3268438 3146403 415 07/10/97 07/10/98 1 192.90 0.00 GA FULTON 1 *** 3803769 2028078 000 04/25/97 04/25/98 1 318.00 0.00 GA FULTON 1 *** 3090167 0320895 800 12/28/97 12/28/98 1 0.00 0.00 GA FULTON 1 *** 3609938 0454616 307 07/05/97 07/05/98 1 0.00 0.00 GA FULTON 1 *** 3718650 0453860 301 10/01/97 10/01/98 1 190.00 0.00 GA FULTON 1 *** 3331677 3146390 406 06/15/97 06/15/98 1 610.00 0.00 GA FULTON 1 *** 3463866 0374898 618 12/31/97 12/31/98 1 430.00 466.79 GA FULTON 1 *** 3707720 8355277 636 04/10/97 04/10/98 1 302.63 158.89 GA FULTON 1 *** 3318117 0330923 703 10/20/97 10/20/98 1 237.50 254.13 GA FULTON 1 *** 3012086 3146363 702 06/14/97 06/14/98 1 610.00 667.19 GA FULTON 1 *** 3475593 2022446 200 06/01/97 06/01/98 1 475.00 299.27 GA FULTON 1 *** 3331688 3161588 339 02/01/97 02/01/98 1 610.00 0.00 GA FULTON 1 *** 3320943 0345468 709 08/10/97 08/10/98 1 404.25 0.00 GA FULTON 1 *** 3513240 3161658 435 11/12/97 11/12/98 1 283.80 307.60 GA FULTON 1 *** 3212978 3146307 325 09/10/96 09/10/97 1 299.00 0.00 GA FULTON 1 *** 3646436 0433775 502 02/01/98 02/01/99 1 465.30 497.87 GA FULTON 1 *** 3600049 0383560 518 03/01/97 03/01/98 1 610.00 652.70 GA FULTON 1 *** 3098778 0232104 208 01/10/98 01/10/99 1 0.00 0.00 GA FULTON 1 *** 2925677 0351712 610 09/30/97 09/30/98 1 285.45 311.32 GA FULTON 1 *** 3500792 0341746 902 01/10/98 01/10/99 1 352.50 390.55 GA FULTON 1 *** 3615113 0386162 501 09/04/97 09/04/98 1 305.00 0.00 GA FULTON 1 *** 3518395 3161821 405 12/16/97 12/16/98 1 364.80 400.50 GA FULTON 1 *** 3542075 0351789 614 03/15/97 03/15/98 1 152.50 0.00 GA FULTON 1 *** 3812084 2027009 000 09/26/97 09/26/98 1 221.12 0.00 GA FULTON 1 *** 3198779 8262398 100 01/10/98 01/10/99 1 543.00 602.69 GA FULTON 1 *** 3755051 2001751 200 06/30/97 06/30/98 1 188.10 203.44 GA FULTON 1 *** 3519758 0341694 633 07/10/97 07/10/98 1 156.68 0.00 GA FULTON 1 *** 3571383 0453856 208 07/28/96 07/28/97 1 174.12 0.00 GA FULTON 1 *** 3565748 0379272 510 07/01/97 07/01/98 1 305.00 63.55 GA FULTON 1 *** 3758218 2001659 204 08/21/97 08/21/98 1 44.55 0.00 GA FULTON 1 *** 3510690 3146420 400 06/10/97 06/10/98 1 405.00 0.00 GA FULTON 1 *** 3224573 0345482 705 08/15/97 08/15/98 1 202.12 220.13 GA FULTON 1 *** 3348990 3161699 327 08/31/97 08/31/98 1 285.45 0.00 Data as of 11/07/97 Page 19 11/20/97
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT A. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97
(Sales tax incl.) # OF FL & GA COUNTY LEASE PRODUCT Customer ST NAME QTY CUSTOMER NAME CUST# CONTRACT# EFFEC. DATE ANNIV. DATE YEARS PRICE Bal GA FULTON 1 *** 3026551 0181538 203 05/28/97 05/28/98 1 254.22 280.75 GA FULTON 1 *** 3811786 2021209 000 09/18/97 09/18/98 1 287.50 282.88 GA FULTON 1 *** 3564183 8353720 601 06/17/97 06/17/98 1 188.19 0.00 GA FULTON 1 *** 2970864 0348990 611 04/30/97 04/30/98 1 205.88 129.71 GA FULTON 1 *** 3219861 0248564 016 01/01/97 01/01/98 1 0.00 0.00 GA FULTON 1 *** 3219861 0248564 016 01/01/97 01/01/98 1 168.19 0.00 GA FULTON 1 *** 3318117 0330923 704 06/10/97 06/10/98 1 0.00 0.00 GA FULTON 1 *** 3025967 0181533 300 02/21/98 02/21/99 1 465.00 524.30 GA FULTON 1 *** 3266735 0351843 609 04/10/97 04/10/98 1 108.90 40.97 GA FULTON 1 *** 3012075 0341749 670 08/01/97 08/01/98 1 196.35 210.09 GA FULTON 1 *** 3012075 0341749 912 08/01/97 08/01/98 1 142.73 152.72 GA FULTON 1 *** 3012075 0341749 925 08/01/97 08/01/98 1 405.00 433.35 GA FULTON 1 *** 3012075 2000711 202 08/01/97 08/01/98 1 188.10 201.27 GA FULTON 1 *** 3517363 0345474 716 10/01/97 10/01/98 1 92.00 0.00 GA FULTON 1 *** 3144237 0358130 601 05/14/97 05/14/98 1 188.10 0.00 GA FULTON 1 *** 3583063 0374671 603 11/10/97 11/10/98 1 141.90 154.04 GA FULTON 1 *** 3396814 0291044 003 09/12/97 09/12/98 1 123.34 132.93 GA FULTON 1 *** 3019988 0181514 158 05/10/97 05/10/98 1 305.00 336.55 GA FULTON 1 *** 3589560 0379219 608 02/23/98 02/23/99 1 465.00 519.40 GA FULTON 1 *** 3751745 9414194 201 04/10/97 04/10/98 1 360.00 0.00 GA FULTON 1 *** 3103692 0227047 123 03/10/97 03/10/98 1 226.25 170.47 GA FULTON 1 *** 3618224 0395886 524 07/29/97 07/06/98 1 0.00 0.00 GA FULTON 1 *** 3475526 3161745 512 09/10/97 09/10/98 1 0.00 0.00 GA FULTON 1 *** 3388901 0310773 801 10/25/97 10/25/98 1 232.65 250.98 GA FULTON 1 *** 3429460 3161813 406 06/15/97 06/15/98 1 169.29 0.00 GA FULTON 1 *** 3098778 0232104 208 01/10/98 01/10/99 1 0.00 0.00 GA FULTON 1 *** 3500792 0341746 902 01/10/98 01/10/99 1 352.50 390.55 GA FULTON 1 *** 3615113 0386162 501 09/04/97 09/04/98 1 305.00 0.00 GA FULTON 1 *** 3542075 0351789 614 03/15/97 03/15/98 1 152.50 0.00 GA FULTON 1 *** 3519758 0341694 633 07/10/97 07/10/98 1 156.68 0.00 GA FULTON 1 *** 3571383 0453865 200 07/28/96 07/28/97 1 0.00 0.00 GA FULTON 1 *** 2304924 3161571 402 05/10/97 05/10/98 1 315.15 0.00 GA FULTON 1 *** 3259865 2028115 002 06/16/97 06/16/98 1 245.98 154.97 Data as of 11/07/97 Page 20 11/20/97
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.
RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Reprot EXHIBIT A Product Name=TRW RED Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 (Sales tax incl.) # OF FL & GA LEASE PRODUCT CUSTOMER AR COUNTY NAME QTY CUSTOMER NAME CUST # CONTRACT # EFFEC.DATE ANNIV.DATE YEARS PRICE BAL ST GA FULTON 1 *** 3565748 0379272 510 07/01/97 07/01/98 1 305.00 63.55 GA FULTON 1 *** 3758218 2001659 204 08/21/97 08/21/98 1 44.55 0.00 GA FULTON 1 *** 3679843 0426737 409 08/26/97 08/26/98 1 285.45 0.00 GA FULTON 1 *** 3778449 2022323 100 04/03/97 04/03/98 1 326.66 355.09 GA FULTON 1 *** 3224573 0345482 705 08/15/97 08/15/98 1 202.13 220.14 GA FULTON 1 *** 3026551 0181538 204 08/29/97 08/29/98 1 259.50 277.67 GA FULTON 1 *** 2970864 0348990 611 04/03/97 04/03/98 1 205.88 129.71 GA FULTON 1 *** 3219861 0248564 016 01/01/97 01/01/98 1 0.00 0.00 GA FULTON 1 *** 3219861 0248564 016 01/01/97 01/01/98 1 168.19 0.00 GA FULTON 1 *** 3318117 0330923 704 06/10/97 06/10/98 1 0.00 0.00 GA FULTON 1 *** 3266735 0351843 609 04/10/97 04/10/98 1 108.90 40.97 GA FULTON 1 *** 3012075 0341749 670 08/01/97 08/01/98 1 196.35 210.09 GA FULTON 1 *** 3517363 0345474 716 10/01/97 10/01/98 1 97.75 0.00 GA FULTON 1 *** 3583063 0374671 603 11/10/97 11/10/98 1 141.90 154.04 GA FULTON 1 *** 3396814 0291044 003 09/12/97 09/12/98 1 123.34 132.93 GA FULTON 1 *** 3019988 0181514 158 05/10/97 05/10/98 1 305.00 336.55 GA FULTON 1 *** 3618224 0395886 524 07/29/97 07/06/98 1 0.00 0.00 GA FULTON 1 *** 3388901 0310773 801 10/25/97 10/25/98 1 232.65 250.98 GA FULTON 2 *** 3091641 0242865 100 12/28/97 12/28/98 1 0.00 0.00 GA FULTON 4 *** 3313101 2001040 100 07/22/97 07/22/98 1 0.00 0.00 GA FULTON 4 *** 3313101 2001040 100 07/22/97 07/22/98 1 0.00 0.00 GA FULTON 5 *** 3308736 8242865 100 12/30/97 12/30/98 1 0.00 0.00 GA GWINNETT 1 *** 3098778 0232104 209 01/10/98 01/10/99 1 0.00 0.00 GA GWINNETT 1 *** 3214266 3146302 409 06/15/97 06/15/98 1 169.12 180.96 GA GWINNETT 1 *** 3584886 0379201 404 06/10/97 06/10/98 1 405.00 150.50 GA GWINNETT 1 *** 3504581 0341883 701 06/13/97 06/13/98 1 256.25 0.00 GA GWINNETT 1 *** 3674462 2001643 200 07/09/97 07/09/98 1 405.00 439.33 GA GWINNETT 1 *** 3680238 2022338 100 05/31/97 05/31/98 1 405.00 0.00 GA GWINNETT 1 *** 3480869 0438768 508 12/16/97 12/16/98 1 465.00 497.55 GA GWINNETT 1 *** 3500758 0341867 701 07/16/97 07/16/98 1 189.55 0.00 GA GWINNETT 1 *** 3542075 0351789 618 03/15/97 03/15/98 1 202.50 0.00 GA GWINNETT 1 *** 3482636 0324075 702 02/15/97 02/15/98 1 405.00 0.00 GA GWINNETT 1 *** 3519758 0341694 624 07/10/97 07/10/98 1 218.76 0.00
Page 21 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.
RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Reprot EXHIBIT A Product Name=TRW RED Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 (SALES TAX INCL.) # OF FL & GA LEASE PRODUCT CUSTOMER AR COUNTY NAME QTY CUSTOMER NAME CUST # CONTRACT # EFFEC.DATE ANNIV.DATE YEARS PRICE BAL ST GA GWINNETT 1 *** 3792401 2030389 100 10/23/97 10/23/98 1 274.54 295.51 GA GWINNETT 1 *** 3571383 0453856 211 07/28/96 07/28/97 1 156.62 0.00 GA GWINNETT 1 *** 3127694 0230026 102 07/03/97 07/03/98 1 405.00 0.00 GA GWINNETT 1 *** 3795013 2018643 100 11/26/97 11/26/98 1 550.00 588.50 GA GWINNETT 1 *** 3713622 0461640 300 06/06/97 06/06/98 1 405.00 0.00 GA GWINNETT 1 *** 3271724 0247892 916 02/27/97 02/27/98 1 102.94 6.07 GA GWINNETT 1 *** 3268438 3146403 424 07/10/97 07/10/98 1 132.90 0.00 GA GWINNETT 1 *** 3090167 0271334 100 12/28/97 12/28/98 1 0.00 0.00 GA GWINNETT 1 *** 3609938 0454616 308 07/05/97 07/05/98 1 0.00 0.00 GA GWINNETT 1 *** 0038841 0242864 100 12/28/97 12/28/98 1 0.00 0.00 GA GWINNETT 1 *** 3453232 0311030 809 10/21/97 10/21/98 1 0.00 0.00 GA GWINNETT 1 *** 3565748 0379272 601 07/01/97 07/01/98 1 256.25 163.80 GA GWINNETT 1 *** 3577426 3161641 406 03/10/97 03/10/98 1 405.00 0.00 GA GWINNETT 1 *** 3758218 2001659 301 10/19/97 10/19/98 1 62.10 0.00 GA GWINNETT 1 *** 3200894 3071759 304 07/28/97 07/28/98 1 0.00 0.00 GA GWINNETT 1 *** 3562558 0353670 601 05/29/97 05/29/98 1 285.45 0.00 GA GWINNETT 1 *** 3610039 0395837 500 05/07/97 05/07/98 1 405.00 0.00 GA GWINNETT 1 *** 2999632 0213788 304 11/21/97 11/21/98 1 328.35 356.80 GA GWINNETT 1 *** 3224573 0345482 716 08/15/97 08/15/98 1 285.45 305.43 GA GWINNETT 1 *** 3654433 0435417 506 02/23/98 02/23/99 1 328.35 360.16 GA GWINNETT 1 *** 3615089 0386062 501 06/11/97 06/11/98 1 256.25 0.00 GA GWINNETT 1 *** 3331677 3146390 405 06/15/97 06/15/98 1 405.00 0.00 GA GWINNETT 1 *** 3348990 0206516 203 08/31/97 08/31/98 1 285.45 2.85 GA GWINNETT 1 *** 3463866 0374898 613 12/31/97 12/31/98 1 295.00 315.65 GA GWINNETT 1 *** 3026551 0341682 715 05/28/97 05/28/98 1 328.23 351.21 GA GWINNETT 1 *** 3811786 2021209 001 09/18/97 09/18/98 1 287.50 276.86 GA GWINNETT 1 *** 3707720 8355277 635 04/10/97 04/10/98 1 212.76 111.70 GA GWINNETT 1 *** 2970864 0348990 612 04/30/97 04/30/98 1 185.55 116.91 GA GWINNETT 1 *** 3539938 0355268 609 09/15/97 09/15/98 1 256.25 278.25 GA GWINNETT 1 *** 3219861 0248564 017 01/01/97 01/01/98 1 0.00 0.00 GA GWINNETT 1 *** 3219861 0248564 017 01/01/97 01/01/98 1 230.63 0.00 GA GWINNETT 1 *** 3318117 0330923 711 11/04/97 11/04/98 1 237.50 254.13 GA GWINNETT 1 *** 3318117 0330923 715 06/10/97 06/10/98 1 0.00 0.00
Page 22 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission.
RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Reprot EXHIBIT A Product Name=TRW RED Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 (SALES TAX INCL.) # OF FL & GA LEASE PRODUCT CUSTOMER AR COUNTY NAME QTY CUSTOMER NAME CUST # CONTRACT # EFFEC.DATE ANNIV.DATE YEARS PRICE BAL ST GA GWINNETT 1 *** 3012086 3146369 408 06/14/97 06/14/98 1 405.00 450.98 GA GWINNETT 1 *** 3475593 2022446 103 04/03/97 04/03/98 1 403.75 169.60 GA GWINNETT 1 *** 3266735 0271825 001 10/10/97 10/10/98 1 169.13 172.92 GA GWINNETT 1 *** 3012075 0341749 864 08/01/97 08/01/98 1 169.13 180.97 GA GWINNETT 1 *** 3012075 0341749 919 08/01/97 08/01/98 1 169.13 179.28 GA GWINNETT 1 *** 3012075 0341749 951 08/01/97 08/01/98 1 285.45 305.43 GA GWINNETT 1 *** 3537729 0349633 608 08/01/97 08/01/98 1 285.45 0.00 GA GWINNETT 1 *** 3110300 0374613 601 08/20/97 08/20/98 1 256.25 275.63 GA GWINNETT 1 *** 3517363 0345474 712 10/14/97 10/14/98 1 133.93 0.00 GA GWINNETT 1 *** 3525298 3161606 402 06/25/97 06/25/98 1 169.13 0.00 GA GWINNETT 1 *** 3331688 3161588 338 02/01/97 02/01/98 1 405.00 0.00 GA GWINNETT 1 *** 3748026 2022464 101 05/24/97 05/24/98 1 475.00 0.00 GA GWINNETT 1 *** 3375932 3161826 402 05/28/97 05/28/98 1 405.00 0.00 GA GWINNETT 1 *** 3774744 2008089 101 10/10/97 10/10/98 1 170.00 0.00 GA GWINNETT 1 *** 3590210 0379218 602 02/15/98 02/15/99 1 328.35 356.80 GA GWINNETT 1 *** 3590221 0379217 602 02/15/98 02/15/99 1 328.35 356.80 GA GWINNETT 1 *** 3513240 3161658 436 11/12/97 11/12/98 1 194.70 208.33 GA GWINNETT 1 *** 3212978 3146307 326 09/10/96 09/10/97 1 205.00 28.42 GA GWINNETT 1 *** 3805389 2017755 000 05/21/97 05/21/98 1 475.00 0.00 GA GWINNETT 1 *** 3396814 0341720 802 09/12/97 09/12/98 1 256.25 278.25 GA GWINNETT 1 *** 3646436 2008629 200 08/02/97 08/02/98 1 405.00 0.00 GA GWINNETT 1 *** 3589560 0379219 607 02/23/98 02/23/99 1 465.00 492.90 GA GWINNETT 1 *** 3744468 9415765 200 05/01/97 05/01/98 1 285.45 0.00 GA GWINNETT 1 *** 3751262 2001702 200 08/23/97 08/23/98 1 256.25 0.00 GA GWINNETT 1 *** 3588068 0379210 602 02/10/98 02/10/99 1 328.35 356.80 GA GWINNETT 1 *** 3103692 0227047 325 03/10/97 03/10/98 1 221.25 162.62 GA GWINNETT 1 *** 3812985 2027006 002 10/08/97 10/08/98 1 216.11 231.24 GA GWINNETT 1 *** 3600049 0383560 519 03/01/97 03/01/98 1 405.00 433.35 GA GWINNETT 1 *** 3796687 2028067 100 06/27/97 06/27/98 1 475.00 0.00 GA GWINNETT 1 *** 3475526 3161745 505 09/10/97 09/10/98 1 0.00 0.00 GA GWINNETT 1 *** 3429460 3146377 405 06/15/97 06/15/98 1 230.61 0.00 GA GWINNETT 5 *** 3308736 8242864 100 12/30/97 12/30/98 1 0.00 0.00 GA GWINNETT 8 *** 3200894 3071759 500 06/10/97 06/10/98 1 0.00 0.00
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RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Reprot EXHIBIT A Product Name=TRW RED Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 (SALES TAX INCL.) # OF FL & GA LEASE PRODUCT CUSTOMER AR COUNTY NAME QTY CUSTOMER NAME CUST # CONTRACT # EFFEC.DATE ANNIV.DATE YEARS PRICE BAL ST GA HALL 1 *** 3098778 0232104 210 01/10/98 01/10/99 1 0.00 0.00 GA HALL 1 *** 3214266 3146302 412 06/15/97 06/15/98 1 211.20 225.98 GA HALL 1 *** 3795013 2028063 000 03/18/97 03/18/98 1 251.75 0.00 GA HALL 1 *** 3090167 0320898 800 12/28/97 12/28/98 1 0.00 0.00 GA HALL 1 *** 0038841 9410090 100 05/24/97 05/24/98 1 0.00 0.00 GA HALL 1 *** 3091641 0242863 100 12/28/97 12/28/98 1 0.00 0.00 GA HALL 1 *** 3577426 3161641 407 03/10/97 03/10/98 1 380.00 0.00 GA HALL 1 *** 3758218 2001659 209 08/21/97 08/21/98 1 145.20 0.00 GA HALL 1 *** 3783870 2018685 100 06/13/97 06/13/98 1 150.15 0.00 GA HALL 1 *** 2321325 0302129 704 04/03/97 04/03/98 1 211.20 0.00 GA HALL 1 *** 3224573 2001797 201 07/27/97 07/27/98 1 211.20 234.81 GA HALL 1 *** 3654433 2017753 000 04/23/97 04/23/98 1 288.00 0.00 GA HALL 1 *** 3539938 0355268 620 09/15/97 09/15/98 1 211.20 232.62 GA HALL 1 *** 3219861 0248564 923 01/01/97 01/01/98 1 0.00 0.00 GA HALL 1 *** 3219861 0248564 923 01/01/97 01/01/98 1 181.12 0.00 GA HALL 1 *** 3012086 2022339 100 06/14/97 06/14/98 1 380.00 402.80 GA HALL 1 *** 3266735 0351843 611 04/10/97 04/10/98 1 117.98 82.59 GA HALL 1 *** 3012075 0341749 914 08/01/97 08/01/98 1 380.00 406.60 GA HALL 1 *** 3012075 0341749 943 08/01/97 08/01/98 1 211.20 223.87 GA HALL 1 *** 3012075 0341749 958 08/01/97 08/01/98 1 211.20 225.98 GA HALL 1 *** 3537729 0349633 607 08/01/97 08/01/98 1 202.50 0.00 GA HALL 1 *** 3331688 3161588 331 02/01/97 02/01/98 1 380.00 120.84 GA HALL 1 *** 3774744 2008090 200 02/15/98 02/15/99 1 244.20 267.60 GA HALL 1 *** 3751262 2001702 201 05/23/97 05/23/98 1 132.83 0.00 GA HALL 1 *** 3751273 2001703 201 05/30/97 05/30/98 1 87.63 0.00 GA HALL 1 *** 3429460 3146377 501 06/15/97 06/15/98 1 190.08 0.00 GA HALL 4 *** 3347607 8152111 400 07/28/97 07/28/98 1 0.00 0.00 GA HALL 8 *** 3308736 8242863 100 12/30/97 12/30/98 1 0.00 0.00 GA HENRY 1 *** 3214266 0302431 805 06/19/97 06/19/98 1 380.00 0.00 GA HENRY 1 *** 3808870 2050023 000 07/21/97 07/21/98 1 237.60 0.00 GA HENRY 1 *** 3271724 0438774 402 02/27/97 02/27/98 1 96.00 0.00 GA HENRY 1 *** 3090167 0320899 800 12/28/97 12/28/98 1 0.00 0.00 GA HENRY 1 *** 0038841 0031247 202 01/19/98 01/19/99 1 0.00 0.00
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RESexA.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Reprot EXHIBIT A Product Name=TRW RED Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 (SALES TAX INCL.) # OF FL & GA LEASE PRODUCT CUSTOMER AR COUNTY NAME QTY CUSTOMER NAME CUST # CONTRACT # EFFEC.DATE ANNIV.DATE YEARS PRICE BAL ST GA HENRY 1 *** 3259865 2028115 003 06/16/97 06/16/98 1 233.10 146.86 GA HENRY 1 *** 3679843 2008631 200 08/26/97 08/26/98 1 211.20 155.08 GA HENRY 1 *** 3218927 0353661 504 11/06/97 11/06/98 1 440.00 497.55 GA HENRY 1 *** 3219861 0248564 925 01/01/97 01/01/98 1 0.00 0.00 GA HENRY 1 *** 3219861 0248564 925 01/01/97 01/01/98 1 201.38 0.00 GA HENRY 1 *** 3488261 0351796 604 03/10/97 03/10/98 1 120.75 0.00 GA HENRY 1 *** 3019988 0181514 005 08/15/97 08/15/98 1 380.00 402.80 GA HENRY 8 *** 3308736 0450895 500 11/30/97 11/30/98 1 0.00 0.00 GA ROCKDALE 1 *** 3098778 0232104 211 01/10/98 01/10/99 1 0.00 0.00 GA ROCKDALE 1 *** 3490994 0461639 301 06/06/97 06/06/98 1 201.25 0.00 GA ROCKDALE 1 *** 3214266 0248316 001 06/15/97 06/15/98 1 105.60 0.00 GA ROCKDALE 1 *** 3121458 0441571 401 05/20/97 05/20/98 1 380.00 0.00 GA ROCKDALE 1 *** 3271724 0341687 602 02/27/97 02/27/98 1 78.19 4.61 GA ROCKDALE 1 *** 3090167 0320816 800 12/28/97 12/28/98 1 0.00 0.00 GA ROCKDALE 1 *** 0038841 0271251 100 12/28/97 12/28/98 1 0.00 0.00 GA ROCKDALE 1 *** 3758218 2001659 210 08/21/97 08/21/98 1 91.80 0.00 GA ROCKDALE 1 *** 3348990 3161699 414 08/31/97 08/31/98 1 211.20 0.00 GA ROCKDALE 1 *** 3707720 8355277 639 04/10/97 04/10/98 1 163.01 85.59 GA ROCKDALE 1 *** 2966854 0341645 600 06/01/97 06/01/98 1 132.83 83.99 GA ROCKDALE 1 *** 3219861 0248564 924 01/01/97 01/01/98 1 0.00 0.00 GA ROCKDALE 1 *** 3219861 0248564 924 01/01/97 01/01/98 1 181.12 0.00 GA ROCKDALE 1 *** 3318117 0435487 403 06/10/97 06/10/98 1 0.00 0.00 GA ROCKDALE 1 *** 3266735 0351843 513 08/10/97 08/10/98 1 132.83 136.54 GA ROCKDALE 1 *** 3012075 0341749 959 08/01/97 08/01/98 1 211.20 225.98 GA ROCKDALE 1 *** 3265697 0271849 004 08/21/97 08/21/98 1 201.25 0.00 GA ROCKDALE 1 *** 3331688 3161588 328 02/01/97 02/01/98 1 380.00 75.25 GA ROCKDALE 1 *** 3513240 2017747 000 05/05/97 05/05/98 1 211.20 0.00 GA ROCKDALE 1 *** 3768208 2008785 201 12/14/97 12/14/98 1 268.33 296.03 GA ROCKDALE 8 *** 3308736 8271251 100 12/30/97 12/30/98 1 0.00 0.00 TOTAL 293,803.83 131,473.19
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RESexB.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 COUNTY NAME QTY CUSTOMER NAME CUST CUST# CON. # EFFEC. ANNIV. LEASE PRODUCT PRICE TOT. SALE TYPE DATE DATE #YRS AMT, FL/GA C&I ONLY BREVARD, FL 1 *** 01 3725603 0473890 302 09/30/97 09/30/98 1 546.25 546.25 BREVARD, FL 1 *** 01 2124016 0172865 401 10/29/96 10/29/97 1 411.60 411.60 BREVARD, FL 1 *** 01 3477018 0323780 801 10/05/97 10/05/98 1 499.95 499.95 BREVARD, FL 1 *** 99 3081657 0216085 303 11/10/97 11/10/98 1 1006.00 1006.00 BREVARD, FL 1 *** 38 2293037 2142805 500 10/10/97 10/10/98 1 757.50 757.50 BREVARD, FL 1 *** 38 2288219 0196502 400 04/28/97 04/28/98 1 0.00 0.00 BREVARD, FL 1 *** 50 2298708 2142871 403 05/10/97 05/10/98 1 732.60 732.60 BREVARD, FL 1 *** 50 3400324 2008271 200 10/18/97 10/18/98 1 1006.00 1006.00 BREVARD, FL 1 *** 50 3147450 3027612 702 07/10/97 07/10/98 1 419.10 419.10 BREVARD, FL 1 *** 54 2950648 0205905 301 03/10/97 03/10/98 1 875.00 875.00 BREVARD, FL 1 *** 87 3613103 0220301 100 03/28/97 03/28/98 1 0.00 0.00 BREVARD, FL 1 *** 50 2320058 2142839 401 09/30/97 09/30/98 1 732.60 732.60 BREVARD, FL 1 *** 87 3090167 0284966 900 12/28/97 12/28/98 1 0.00 0.00 BREVARD, FL 1 *** 86 2916683 2014768 200 10/30/97 10/30/98 1 0.00 0.00 BREVARD, FL 1 *** 99 0038841 0237919 200 12/28/97 12/28/98 1 0.00 0.00 BREVARD, FL 1 *** 50 3495111 0341510 701 04/10/97 04/10/98 1 1090.00 1090.00 BREVARD, FL 1 *** 01 3515332 0357563 704 08/10/97 08/10/98 1 640.00 640.00 BREVARD, FL 1 *** 37 3014600 0187524 600 08/27/97 08/27/98 1 0.00 0.00 BREVARD, FL 1 *** 37 2462851 0235541 001 03/10/97 03/10/98 1 750.00 750.00 BREVARD, FL 1 *** 01 2595478 0175928 301 01/10/98 01/10/98 1 739.00 739.00 BREVARD, FL 1 *** 01 2444796 2123182 502 11/10/97 11/10/98 1 738.75 738.75 BREVARD, FL 1 *** 50 3175963 0239070 102 11/10/97 11/10/98 1 694.65 694.65 BREVARD, FL 1 *** 01 2354107 2142874 503 10/10/97 10/10/98 1 0.00 0.00 BREVARD, FL 1 *** 50 3532410 0349532 601 03/10/97 03/10/98 1 950.00 950.00 BREVARD, FL 1 *** 50 3532421 0941354 701 08/25/97 08/25/98 1 431.67 431.67 BREVARD, FL 1 *** 50 2181664 2142822 502 11/03/97 11/03/98 1 694.65 694.65 BREVARD, FL 1 *** 50 2536361 2142830 402 04/01/97 04/01/98 1 610.00 610.00 BREVARD, FL 1 *** 50 3665679 2027953 000 03/25/97 03/25/98 1 990.00 990.00 BREVARD, FL 1 *** 01 3398940 0278748 800 04/10/97 04/10/98 1 620.00 620.00 BREVARD, FL 1 *** 50 3800458 2018869 000 03/07/97 03/07/98 1 990.00 990.00 BREVARD, FL 1 *** 50 2016429 0354955 602 04/10/97 04/10/98 1 640.00 640.00
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RESexB.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 COUNTY NAME QTY CUSTOMER NAME CUST CUST# CON. # EFFEC. ANNIV. LEASE PRODUCT PRICE TOT. SALE TYPE DATE DATE #YRS AMT, FL/GA C&I ONLY BREVARD, FL 1 *** 01 2296476 0323776 702 02/10/97 02/10/98 1 422.40 422.40 BREVARD, FL 1 *** 01 2296476 8123184 500 01/10/98 01/10/99 1 739.00 739.00 BREVARD, FL 1 *** 50 3170300 0239042 100 08/10/97 08/10/98 1 732.60 732.60 BREVARD, FL 1 *** 01 3733770 0504778 201 07/24/97 07/24/98 1 373.75 373.75 BREVARD, FL 8 *** 87 3308736 8237919 100 12/30/97 12/30/98 1 0.00 0.00 BROWARD, FL 1 *** 01 2337799 2160527 402 03/10/97 03/10/98 1 758.17 758.17 BROWARD, FL 1 *** 01 2989020 0175905 300 08/10/97 08/10/98 1 1285.00 1285.00 BROWARD, FL 1 *** 01 2102003 2127986 400 08/10/97 08/10/98 2 879.50 1759.00 BROWARD, FL 1 *** 01 2255727 2146237 400 05/01/97 05/01/98 1 758.17 758.17 BROWARD, FL 1 *** 01 2124016 2146254 401 05/01/97 05/01/98 1 573.10 573.10 BROWARD, FL 1 *** 01 3346037 0282455 903 10/10/97 10/10/98 1 588.06 588.06 BROWARD, FL 1 *** 38 2146351 2160504 500 02/28/98 02/28/99 1 0.00 0.00 BROWARD, FL 1 *** 38 2774941 2123322 502 04/10/97 04/10/98 1 1009.68 1009.68 BROWARD, FL 1 *** 01 3449718 2018776 000 04/10/97 04/10/98 1 1385.00 1385.00 BROWARD, FL 1 *** 01 3096152 0259150 902 05/10/97 05/10/98 2 1100.00 2200.00 BROWARD, FL 1 *** 01 3576629 0375361 609 10/10/97 10/10/98 1 648.00 648.00 BROWARD, FL 1 *** 01 3695102 0452568 401 12/10/97 12/10/98 1 1480.00 1480.00 BROWARD, FL 1 *** 51 2498113 2160466 503 01/15/98 01/15/99 1 1480.00 1480.00 BROWARD, FL 1 *** 51 3147416 0176031 100 07/10/97 07/10/98 1 1285.00 1285.00 BROWARD, FL 1 *** 01 2207342 2123328 404 05/10/97 05/10/98 2 679.50 1359.00 BROWARD, FL 1 *** 50 2931049 0206917 403 12/10/97 12/10/98 1 1480.00 1480.00 BROWARD, FL 1 *** 87 3613103 0220370 100 03/28/97 03/28/98 1 0.00 0.00 BROWARD, FL 1 *** 87 3090167 0258778 104 08/07/97 08/07/98 1 0.00 0.00 BROWARD, FL 1 *** 99 0038841 0271265 100 07/18/97 07/18/98 1 0.00 0.00 BROWARD, FL 1 *** 01 2013240 2189608 402 04/10/97 04/10/98 1 0.00 0.00 BROWARD, FL 1 *** 01 2013240 2189608 403 10/07/97 10/07/98 1 1285.00 1285.00 BROWARD, FL 1 *** 37 3014600 2160393 500 10/30/97 10/30/98 1 0.00 0.00 BROWARD, FL 1 *** 37 3673115 0445336 402 07/01/97 07/01/98 1 887.50 887.50 BROWARD, FL 1 *** 53 2308416 2151544 402 05/10/97 05/10/98 1 898.75 898.75 BROWARD, FL 1 *** 01 3756964 2007363 202 08/01/97 08/01/98 1 767.50 767.50 BROWARD, FL 1 *** 01 2210201 2123299 401 04/15/97 04/15/98 1 1132.50 1132.50 BROWARD, FL 1 *** 01 3556151 0351443 604 06/10/97 06/10/98 1 1285.00 1285.00 BROWARD, FL 1 *** 01 3026283 0183708 203 02/28/97 02/28/98 1 1285.00 1285.00
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RESexB.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 COUNTY NAME QTY CUSTOMER NAME CUST CUST# CON. # EFFEC. ANNIV. LEASE PRODUCT PRICE TOT. SALE TYPE DATE DATE #YRS AMT, FL/GA C&I ONLY BROWARD, FL 1 *** 50 3757116 2018722 101 05/20/98 05/20/99 1 1285.00 1285.00 BROWARD, FL 1 *** 01 2131795 2189613 401 05/10/97 05/10/98 1 1285.00 1285.00 BROWARD, FL 1 *** 08 3008157 0183064 302 03/10/97 03/10/98 1 1141.50 1141.50 BROWARD, FL 1 *** 01 2514587 2123343 403 05/10/97 05/10/98 1 1285.00 1285.00 BROWARD, FL 1 *** 01 2973685 0213588 300 06/10/97 06/10/98 1 1285.00 1285.00 BROWARD, FL 1 *** 50 2003540 0338023 701 05/01/97 05/01/98 1 1148.75 1148.75 BROWARD, FL 1 *** 50 2003540 2156536 401 05/01/97 05/01/98 1 765.83 765.83 BROWARD, FL 1 *** 50 3625211 0408430 501 05/03/97 05/03/98 1 1285.00 1285.00 BROWARD, FL 1 *** 50 2147219 0205546 203 02/10/97 02/10/98 1 285.00 285.00 BROWARD, FL 1 *** 01 2220136 2151556 503 02/27/97 02/27/98 1 900.00 900.00 BROWARD, FL 1 *** 01 2780120 0450911 402 06/01/97 06/01/98 1 1285.00 1285.00 BROWARD, FL 1 *** 50 3385735 2160655 401 03/10/97 03/10/98 1 1285.00 1285.00 BROWARD, FL 1 *** 51 3805068 2017710 001 06/30/97 06/30/98 1 1285.00 1285.00 BROWARD, FL 1 *** 01 2773526 2123372 401 07/10/97 07/10/98 1 1285.00 1285.00 BROWARD, FL 1 *** 01 2170480 2123363 401 05/10/97 05/10/98 1 859.51 859.51 BROWARD, FL 1 *** 53 2382078 2189625 403 06/10/97 06/10/98 1 0.00 0.00 BROWARD, FL 1 *** 01 2264402 0187464 402 06/10/97 06/10/98 1 744.00 744.00 BROWARD, FL 1 *** 01 2014881 2156510 401 04/15/97 04/15/98 1 131.84 131.84 BROWARD, FL 1 *** 50 2162537 2002360 200 04/10/97 04/10/98 1 1285.00 1285.00 BROWARD, FL 1 *** 61 2309844 2179108 001 11/29/97 11/29/98 1 1480.00 1480.00 BROWARD, FL 1 *** 54 2167938 2179033 403 02/10/97 02/10/98 1 0.00 0.00 BROWARD, FL 1 *** 01 3752427 2007221 300 09/10/97 09/10/98 1 0.00 0.00 BROWARD, FL 1 *** 01 2795395 0482454 301 08/10/97 08/10/98 1 303.27 303.27 BROWARD, FL 1 *** 01 2922773 0186783 402 11/15/97 11/15/98 1 999.05 999.05 BROWARD, FL 1 *** 01 3662753 0427015 402 07/01/97 07/01/98 1 919.00 919.00 BROWARD, FL 1 *** 01 2589510 0304366 805 08/15/97 08/15/98 1 1285.00 1285.00 BROWARD, FL 8 *** 87 3308736 8271266 100 12/30/97 12/30/98 1 0.00 0.00 BROWARD, FL 1 *** 87 3098778 0232104 200 01/10/98 01/10/99 1 0.00 0.00 CHEROKEE, GA 1 *** 50 2925677 0351712 601 09/30/97 09/30/98 1 232.65 232.65 CHEROKEE, GA 1 *** 53 3214266 3161878 304 06/15/96 12/15/97 1 171.00 171.00 CHEROKEE, GA 1 *** 50 3542075 0453849 301 03/15/97 03/15/98 1 202.50 202.50 CHEROKEE, GA 1 *** 50 3418200 3161740 402 08/18/97 08/18/98 1 163.20 163.20 CHEROKEE, GA 1 *** 53 3571383 0453856 212 07/28/96 07/28/97 1 133.00 133.00
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RESexB.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 COUNTY NAME QTY CUSTOMER NAME CUST CUST# CON. # EFFEC. ANNIV. LEASE PRODUCT PRICE TOT. SALE TYPE DATE DATE #YRS AMT, FL/GA C&I ONLY CHEROKEE, GA 1 *** 01 3271724 0247892 919 02/25/97 02/25/98 1 85.50 85.50 CHEROKEE, GA 1 *** 87 3090167 0271313 100 12/28/97 12/28/98 1 0.00 0.00 CHEROKEE, GA 1 *** 99 3091641 0242872 100 12/28/97 12/28/98 1 0.00 0.00 CHEROKEE, GA 1 *** 01 3345302 0354890 702 02/10/98 02/10/99 1 187.85 187.85 CHEROKEE, GA 1 *** 37 3758218 2001659 205 08/21/97 08/21/98 1 91.80 91.80 CHEROKEE, GA 1 *** 01 3606067 0394443 500 04/10/97 04/10/98 1 405.00 405.00 CHEROKEE, GA 1 *** 50 3224573 0345482 726 01/16/98 01/16/99 1 465.00 465.00 CHEROKEE, GA 1 *** 01 3688960 2008478 200 10/26/97 10/26/98 1 311.85 311.85 CHEROKEE, GA 1 *** 50 3463866 0374898 616 12/31/97 12/31/98 1 250.00 250.00 CHEROKEE, GA 1 *** 50 3026551 2018656 000 10/23/97 10/23/98 1 209.37 209.37 CHEROKEE, GA 1 *** 50 3811786 2021209 002 09/18/97 09/18/98 1 243.75 243.75 CHEROKEE, GA 1 *** 01 3707720 8355277 637 04/10/97 04/10/98 1 176.17 176.17 CHEROKEE, GA 1 *** 01 3564183 8353721 601 06/17/97 06/17/98 1 127.71 127.71 CHEROKEE, GA 1 *** 53 3219861 0248564 921 01/01/97 01/01/98 1 0.00 0.00 CHEROKEE, GA 1 *** 53 3219861 0248564 921 01/01/97 01/01/98 1 195.75 195.75 CHEROKEE, GA 1 *** 50 3012086 0228496 101 06/14/97 06/14/98 1 405.00 405.00 CHEROKEE, GA 1 *** 50 3012075 0314749 795 08/01/97 08/01/98 1 217.50 217.50 CHEROKEE, GA 1 *** 50 3012075 0341749 913 08/01/97 08/01/98 1 143.55 143.55 CHEROKEE, GA 1 *** 50 3012075 0341749 928 08/01/97 08/01/98 1 405.00 405.00 CHEROKEE, GA 1 *** 50 3012075 0341749 953 08/01/97 08/01/98 1 232.65 232.65 CHEROKEE, GA 1 *** 01 3331688 3161588 332 02/01/97 02/01/98 1 405.00 405.00 CHEROKEE, GA 1 *** 01 3731493 0462489 302 11/22/97 11/22/98 1 440.00 440.00 CHEROKEE, GA 1 *** 01 3778944 2022340 100 04/05/97 04/05/98 1 237.50 237.50 CHEROKEE, GA 1 *** 01 3513240 3161658 438 11/12/97 11/12/98 1 182.32 182.32 CHEROKEE, GA 1 *** 99 3751745 9414194 300 09/12/97 09/12/98 1 405.00 405.00 CHEROKEE, GA 1 *** 01 3103692 2038893 100 06/26/97 06/26/98 1 175.00 175.00 CHEROKEE, GA 1 *** 50 3419058 0196126 400 01/29/98 01/29/99 1 166.00 166.00 CHEROKEE, GA 1 *** 01 3804517 2017754 000 05/12/97 05/12/98 1 237.50 237.50 CHEROKEE, GA 1 *** 87 3308736 8242872 100 12/30/97 12/30/98 1 0.00 0.00 CITY ATLANTA, GA 1 *** 87 3008778 0232104 201 01/10/98 01/10/99 1 0.00 0.00 CITY ATLANTA, GA 1 *** 53 3214266 3146302 250 11/08/97 11/08/98 1 580.00 580.00 CITY ATLANTA, GA 1 *** 39 3802962 3130263 503 07/10/97 07/10/98 1 360.00 360.00 CITY ATLANTA, GA 1 *** 33 2925769 0345525 700 02/15/98 02/15/99 1 580.00 580.00
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RESexB.XLS, EXPERIAN CONFIDENTIAL Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 COUNTY NAME QTY CUSTOMER NAME CUST CUST# CON. # EFFEC. ANNIV. LEASE PRODUCT PRICE TOT. SALE TYPE DATE DATE #YRS AMT, FL/GA C&I ONLY CITY ATLANTA, GA 1 *** 87 3090167 8244453 000 06/26/97 06/26/98 1 0.00 0.00 CITY ATLANTA, GA 1 *** 99 0038841 0242871 100 12/28/97 12/28/98 1 0.00 0.00 CITY ATLANTA, GA 1 *** 50 3124505 3151856 500 11/30/97 11/30/98 1 0.00 0.00 CITY ATLANTA, GA 1 *** 53 3219861 0248564 020 01/01/97 01/01/98 1 0.00 0.00 CITY ATLANTA, GA 1 *** 53 3219861 0248564 020 01/01/97 01/01/98 1 324.00 324.00 CITY ATLANTA, GA 1 *** 50 3012075 0341749 800 08/01/97 08/01/98 1 505.00 505.00 CITY ATLANTA, GA 1 *** 20 3619689 0424326 401 03/15/97 03/15/98 1 275.00 275.00 CITY ATLANTA, GA 4 *** 38 3313101 3151857 500 01/28/98 01/28/99 1 0.00 0.00 CITY ATLANTA, GA 5 *** 87 3308736 8242871 100 12/30/97 12/30/98 1 0.00 0.00 CLAYTON, GA 1 *** 87 3098778 0232104 202 01/10/98 01/10/99 1 0.00 0.00 CLAYTON, GA 1 *** 53 3214266 3146302 410 06/15/97 06/15/98 1 169.13 169.13 CLAYTON, GA 1 *** 50 3542075 0351789 616 03/15/97 03/15/98 1 202.50 202.50 CLAYTON, GA 1 *** 38 3257111 0187507 300 08/27/97 08/27/98 1 0.00 0.00 CLAYTON, GA 1 *** 38 3552728 3151863 500 01/28/98 01/28/99 1 0.00 0.00 CLAYTON, GA 1 *** 38 3255894 0260383 000 07/28/97 07/28/98 1 0.00 0.00 CLAYTON, GA 1 *** 01 3271724 0310394 702 02/25/97 02/25/98 1 78.19 78.19 CLAYTON, GA 1 *** 50 3268438 3146403 427 07/10/97 07/10/98 1 224.25 224.25 CLAYTON, GA 1 *** 54 3803769 2028078 001 04/25/97 04/25/98 1 217.82 217.82 CLAYTON, GA 1 *** 87 3090167 0320887 800 12/28/97 12/28/98 1 0.00 0.00 CLAYTON, GA 1 *** 85 3609938 0454616 301 07/05/97 07/05/98 1 0.00 0.00 CLAYTON, GA 1 *** 99 0038841 0242869 100 12/28/97 12/28/98 1 0.00 0.00 CLAYTON, GA 1 *** 50 3259865 2028115 000 06/16/97 06/16/98 1 165.59 165.59 CLAYTON, GA 1 *** 37 3758218 2001659 202 08/21/97 08/21/98 1 91.80 91.80 CLAYTON, GA 1 *** 52 3679843 0426737 410 08/26/97 08/26/98 1 285.45 285.45 CLAYTON, GA 1 *** 50 3123746 0229033 100 09/19/97 09/19/98 1 169.12 169.12 CLAYTON, GA 1 *** 01 3331677 3146390 409 06/15/97 06/15/98 1 405.00 405.00 CLAYTON, GA 1 *** 50 3463866 0374898 614 12/31/97 12/31/98 1 295.00 295.00 CLAYTON, GA 1 *** 01 3707720 8355277 632 04/10/97 04/10/98 1 212.77 212.77 CLAYTON, GA 1 *** 01 2970864 0348990 607 04/30/97 04/30/98 1 185.55 185.55 CLAYTON, GA 1 *** 53 3219861 0248564 019 01/01/97 01/01/98 1 0.00 0.00 CLAYTON, GA 1 *** 53 3219861 0248564 019 01/01/97 01/01/98 1 230.62 230.62 CLAYTON, GA 1 *** 50 3488261 0341605 701 03/10/97 03/10/98 1 149.55 149.55 CLAYTON, GA 1 *** 50 3012075 0341749 952 08/01/97 08/01/98 1 285.45 285.45
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COUNTY NAME QTY CUSTOMER NAME CUST# CUST CON # EFFEC. ANNIV. LEASE PRODUCT TOT.SALE TYPE DATE DATE # YRS PRICE AMT, FL/GA C&I ONLY CLAYTON, GA 1 *** 01 3331688 3161588 335 02/01/97 02/01/98 1 405.00 405.00 CLAYTON, GA 1 *** 01 3513240 3161658 437 11/12/97 11/12/98 1 194.70 194.70 CLAYTON, GA 1 *** 50 3396814 0341772 802 09/12/97 09/12/98 1 256.25 256.25 CLAYTON, GA 1 *** 01 3019988 0181514 155 05/10/97 05/10/98 1 405.00 405.00 CLAYTON, GA 1 *** 01 3600049 0383560 515 03/01/97 03/01/98 1 405.00 405.00 CLAYTON, GA 1 *** 01 3697683 0503835 301 03/01/97 03/01/98 1 405.00 405.00 CLAYTON, GA 5 *** 87 3308736 8242869 100 12/30/97 12/30/98 1 0.00 0.00 COBB, GA 1 *** 87 3098778 0232104 203 01/10/98 01/10/99 1 0.00 0.00 COBB, GA 1 *** 53 3214266 3146302 407 06/15/97 06/15/98 1 169.13 169.13 COBB, GA 1 *** 01 3480869 0438768 506 12/16/97 12/16/98 1 465.00 465.00 COBB, GA 1 *** 50 3542075 0351789 615 03/15/97 03/15/98 1 202.50 202.50 COBB, GA 1 *** 50 3418200 3161740 403 08/18/97 08/18/98 1 189.55 189.55 COBB, GA 1 *** 51 3611513 0394437 502 06/01/97 06/01/98 1 169.13 169.13 COBB, GA 1 *** 50 3583403 0375456 603 12/10/97 12/10/98 1 465.00 465.00 COBB, GA 1 *** 38 3418211 0498050 300 05/23/97 05/23/98 1 0.00 0.00 COBB, GA 1 *** 01 3519758 0341694 625 07/10/97 07/10/98 1 218.76 218.76 COBB, GA 1 *** 53 3571383 0453856 209 07/28/96 07/28/97 1 156.62 156.62 COBB, GA 1 *** 01 3271724 0247892 917 02/25/97 02/25/98 1 102.94 102.94 COBB, GA 1 *** 50 3268438 3146403 423 07/10/97 07/10/98 1 132.90 132.90 COBB, GA 1 *** 51 3722044 0462403 300 08/17/97 08/17/98 1 256.25 256.25 COBB, GA 1 *** 87 3090167 0320889 800 12/28/97 12/28/98 1 0.00 0.00 COBB, GA 1 *** 85 3609938 0454616 302 07/06/97 07/06/98 1 0.00 0.00 COBB, GA 1 *** 01 3565748 0379272 500 07/01/97 07/01/98 1 405.00 405.00 COBB, GA 1 *** 01 3345302 2066907 000 05/17/97 05/17/98 1 405.00 405.00 COBB, GA 1 *** 37 3758218 2001659 302 08/21/97 08/21/98 1 89.10 89.10 COBB, GA 1 *** 50 2938435 0204210 402 02/27/98 02/27/99 1 253.00 253.00 COBB, GA 1 *** 50 3593420 9418835 200 05/19/97 05/19/98 1 405.00 405.00 COBB, GA 1 *** 01 3021277 0213199 202 12/31/97 12/31/98 1 465.00 465.00 COBB, GA 1 *** 54 3009763 0213146 205 08/15/97 08/15/98 1 256.25 256.25 COBB, GA 1 *** 50 3224573 0345482 715 08/15/97 08/15/98 1 285.45 285.45 COBB, GA 1 *** 01 3331677 3146390 408 06/16/97 06/16/98 1 405.00 405.00 COBB, GA 1 *** 50 3348990 3161699 328 08/31/97 08/31/98 1 285.45 285.45 COBB, GA 1 *** 50 3463866 0374898 615 12/31/97 12/31/98 1 295.00 295.00 Date as of 11/07/97 Page 6 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE CUST CUST# CON.# EFFEC. ANNIV. LEASE PRODUCT AMT. FL/GA COUNTY NAME QTY CUSTOMER NAME TYPE DATE DATE #YRS PRICE C&I ONLY COBB, GA 1 *** 50 3026551 0341738 712 05/28/97 05/28/98 1 239.23 239.23 COBB, GA 1 *** 50 3052192 0206739 209 08/10/97 08/10/98 1 256.25 256.25 COBB, GA 1 *** 01 3707720 8355277 633 04/10/97 04/10/98 1 212.77 212.77 COBB, GA 1 *** 50 3500565 3161626 300 04/10/97 04/10/98 1 189.55 189.55 COBB, GA 1 *** 32 3279685 8250635 002 09/10/97 09/10/98 1 405.00 405.00 COBB, GA 1 *** 01 3564183 0353716 601 06/17/97 06/17/98 1 170.33 170.33 COBB, GA 1 *** 01 2970864 0348990 608 04/30/97 04/30/98 1 185.55 185.55 COBB, GA 1 *** 53 3219861 0248564 018 01/01/97 01/01/98 1 0.00 0.00 COBB, GA 1 *** 53 3219861 0248564 018 01/01/97 01/01/98 1 230.62 230.62 COBB, GA 1 *** 50 3318117 0330923 713 10/20/97 10/20/98 1 237.50 237.50 COBB, GA 1 *** 50 3318117 0330923 714 06/10/97 06/10/98 1 0.00 0.00 COBB, GA 1 *** 50 3012086 3146369 407 06/14/97 06/14/98 1 405.00 405.00 COBB, GA 1 *** 50 3475593 2022446 100 04/03/97 04/03/98 1 403.75 403.75 COBB, GA 1 *** 50 3012075 0341749 863 08/01/97 08/01/98 1 169.13 169.13 COBB, GA 1 *** 50 3012075 0341749 895 08/01/97 08/01/98 1 142.73 142.73 COBB, GA 1 *** 50 3012075 0341749 939 08/01/97 08/01/98 1 169.12 169.12 COBB, GA 1 *** 50 3012075 0341749 949 08/01/97 08/01/98 1 285.44 285.44 COBB, GA 1 *** 01 3517363 0345474 706 10/01/97 10/01/98 1 133.93 133.93 COBB, GA 1 *** 01 3331688 3161588 336 02/01/97 02/01/98 1 405.00 405.00 COBB, GA 1 *** 01 3052170 8353776 602 04/10/97 04/10/98 1 189.55 189.55 COBB, GA 1 *** 50 3144237 0453886 301 07/28/97 07/28/98 1 256.25 256.25 COBB, GA 1 *** 19 3632576 0386193 402 10/06/96 10/06/97 1 0.00 0.00 COBB, GA 1 *** 01 3513240 3161658 441 11/12/97 11/12/98 1 212.02 212.02 COBB, GA 1 *** 01 3212978 3146307 327 09/10/96 09/10/97 1 205.00 205.00 COBB, GA 1 *** 50 3396814 0345472 702 09/12/97 09/12/98 1 256.25 256.25 COBB, GA 1 *** 54 3646436 0433775 505 02/10/98 02/10/99 1 328.35 328.35 COBB, GA 1 *** 01 3103692 0227047 201 12/23/96 12/23/97 1 256.90 256.90 COBB, GA 1 *** 12 3812985 2027006 000 10/08/97 10/08/98 1 273.11 273.11 COBB, GA 1 *** 01 3600049 0383560 516 03/10/97 03/10/98 1 405.00 405.00 COBB, GA 2 *** 99 3091611 0242870 100 12/28/97 12/28/98 1 0.00 0.00 COBB, GA 6 *** 87 3308736 0242870 100 12/28/97 12/28/98 1 0.00 0.00 COBB, GA 12 *** 38 3550988 0238044 001 05/15/97 05/15/98 1 0.00 0.00 COWETA, GA 1 *** 53 3214266 0438734 300 06/15/97 06/15/98 1 380.00 380.00 Data as of 11/07/97 Page 7 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE CUST CUST# CON.# EFFEC. ANNIV. LEASE PRODUCT AMT. FL/GA COUNTY NAME QTY CUSTOMER NAME TYPE DATE DATE #YRS PRICE C&I ONLY COWETA, GA 1 *** 87 3090167 0439830 400 08/30/97 08/30/98 1 0.00 0.00 COWETA, GA 1 *** 85 3609938 0439782 200 10/24/97 10/24/98 1 0.00 0.00 COWETA, GA 1 *** 99 0038841 0031247 216 01/30/98 01/30/99 1 0.00 0.00 COWETA, GA 1 *** 99 3091641 0454176 300 10/17/97 10/17/98 1 0.00 0.00 COWETA, GA 1 *** 53 3219861 0248564 021 01/01/97 01/01/98 1 0.00 0.00 COWETA, GA 1 *** 53 3219861 0248564 021 01/01/97 01/01/98 1 342.00 342.00 COWETA, GA 1 *** 11 3552919 0378967 301 10/17/97 10/17/98 1 440.00 440.00 COWETA, GA 1 *** 01 3019988 0181514 130 08/15/97 08/15/98 1 380.00 380.00 DADE, FL 1 *** 01 2989020 2008307 201 10/11/97 10/11/98 1 1325.00 1325.00 DADE, FL 1 *** 01 2012003 2167502 401 03/10/97 03/10/98 2 1155.00 1155.00 DADE, FL 1 *** 01 2255727 2146236 501 05/01/97 05/01/98 1 818.32 818.32 DADE, FL 1 *** 01 2124016 2134363 501 11/09/97 11/09/98 1 545.00 545.00 DADE, FL 1 *** 01 3346037 0282441 903 06/13/97 06/13/98 1 609.18 609.18 DADE, FL 1 *** 51 2945950 8123259 503 10/01/97 10/01/98 1 2142.50 2142.50 DADE, FL 1 *** 01 3096152 0228743 201 06/10/97 06/10/98 1 1325.00 1325.00 DADE, FL 1 *** 50 3079593 0216778 301 10/28/97 10/28/98 1 1525.00 1525.00 DADE, FL 1 *** 01 3576629 0375363 609 10/10/97 10/10/98 1 528.75 528.75 DADE, FL 1 *** 51 2498113 2134390 602 01/19/98 01/19/98 1 1525.00 1525.00 DADE, FL 1 *** 51 3147416 2030659 000 03/25/97 03/25/98 1 1498.00 1498.00 DADE, FL 1 *** 87 3613103 0220302 100 03/03/97 03/03/98 1 0.00 0.00 DADE, FL 1 *** 50 2276818 0205528 301 10/01/97 10/01/98 1 1155.00 1155.00 DADE, FL 1 *** 87 3090167 0284975 000 12/05/97 12/05/98 1 0.00 0.00 DADE, FL 1 *** 99 0038841 0300076 100 12/05/97 12/05/98 1 0.00 0.00 DADE, FL 1 *** 50 2572154 2156596 500 05/24/97 05/24/98 1 1325.00 1325.00 DADE, FL 1 *** 37 3014600 0196520 400 05/07/97 05/07/98 1 0.00 0.00 DADE, FL 1 *** 37 2730251 0205515 301 07/16/97 07/16/98 1 615.33 615.33 DADE, FL 1 *** 01 2336231 2143053 402 10/27/96 10/27/97 1 0.00 0.00 DADE, FL 1 *** 01 3756964 2007365 202 08/01/97 08/01/98 1 711.67 711.67 DADE, FL 1 *** 01 3539792 0369333 601 05/01/97 05/01/98 1 1325.00 1325.00 DADE, FL 1 *** 01 3026283 2028288 100 07/16/97 07/16/98 1 1325.00 1325.00 DADE, FL 1 *** 50 3757116 2008315 302 10/10/98 10/10/99 1 1325.00 1325.00 DADE, FL 1 *** 01 3711280 0460278 301 05/16/97 05/16/98 1 1325.00 1325.00 DADE, FL 1 *** 50 2003540 2156801 501 11/10/97 11/10/98 1 0.00 0.00 Data as of 11/07/97 Page 8 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE CUST CUST# CON.# EFFEC. ANNIV. LEASE PRODUCT AMT. FL/GA COUNTY NAME QTY CUSTOMER NAME TYPE DATE DATE #YRS PRICE C&I ONLY DADE, FL 1 *** 50 2719630 2028293 000 08/06/96 08/06/97 1 825.00 825.00 DADE, FL 1 *** 50 2147219 2143046 500 02/10/98 02/10/98 1 1525.00 1525.00 DADE, FL 1 *** 53 2290131 2127965 500 11/14/97 11/14/98 1 434.62 434.62 DADE, FL 1 *** 01 2585651 2143467 600 06/10/97 06/10/98 1 1325.00 1325.00 DADE, FL 1 *** 01 2780120 2146675 601 03/14/97 03/14/98 1 1325.00 1325.00 DADE, FL 1 *** 50 2111717 2134314 501 09/28/97 09/28/98 1 883.75 883.75 DADE, FL 1 *** 01 2773526 0262602 001 03/10/97 03/10/98 1 1325.00 1325.00 DADE, FL 1 *** 53 2249685 2156598 503 11/01/97 11/01/98 1 1139.40 1139.40 DADE, FL 1 *** 01 3155204 2018891 000 04/01/97 04/01/98 1 797.67 797.67 DADE, FL 1 *** 01 2014881 8251261 902 12/10/96 12/10/97 1 592.25 592.25 DADE, FL 1 *** 01 3291852 2146300 504 12/01/97 12/01/98 1 1392.98 1392.98 DADE, FL 1 *** 61 2309844 2179109 600 11/29/97 11/29/98 1 0.00 0.00 DADE, FL 1 *** 10 2243616 2134343 501 12/10/97 12/10/98 1 1024.35 1024.35 DADE, FL 1 *** 01 3752427 2022838 100 06/10/97 06/10/98 1 0.00 0.00 DADE, FL 1 *** 01 3198757 0235782 102 01/28/97 01/28/98 1 1047.38 1047.38 DADE, FL 1 *** 01 2589510 2146608 402 08/15/97 08/15/98 1 324.06 324.06 DADE, FL 2 *** 38 2363684 0207107 700 09/30/97 09/30/98 1 0.00 0.00 DADE, FL 8 *** 87 3308736 8271267 000 12/30/97 12/30/98 1 0.00 0.00 DEKALB, GA 1 *** 87 3098778 0232104 204 01/10/98 01/10/99 1 0.00 0.00 DEKALB, GA 1 *** 53 3214266 3146302 408 06/15/97 06/15/98 1 169.13 169.13 DEKALB, GA 1 *** 01 3480869 0438768 507 12/16/97 12/16/98 1 465.00 465.00 DEKALB, GA 1 *** 50 3542075 0351789 617 03/15/97 03/15/98 1 202.50 202.50 DEKALB, GA 1 *** 01 3519758 0341694 623 07/10/97 07/10/98 1 218.76 218.76 DEKALB, GA 1 *** 53 3571383 0453856 210 07/28/96 07/28/97 1 156.62 156.62 DEKALB, GA 1 *** 01 3271724 0247892 918 02/27/97 02/27/98 1 102.94 102.94 DEKALB, GA 1 *** 50 3268438 3146403 422 07/10/97 07/10/98 1 132.90 132.90 DEKALB, GA 1 *** 38 3291115 3161572 401 06/25/97 06/25/98 1 475.00 475.00 DEKALB, GA 1 *** 68 3219849 3146407 403 06/25/97 06/25/98 1 189.55 189.55 DEKALB, GA 1 *** 54 3803769 2028078 002 04/25/97 04/25/98 1 217.81 217.81 DEKALB, GA 1 *** 87 3090167 0320890 800 12/28/97 12/28/98 1 0.00 0.00 DEKALB, GA 1 *** 85 3609938 0454616 304 07/06/97 07/05/98 1 0.00 0.00 DEKALB, GA 1 *** 99 0038841 0242862 100 12/28/97 12/28/98 1 0.00 0.00 DEKALB, GA 1 *** 85 3796357 2018740 101 12/20/97 12/20/98 1 0.00 0.00 Data as of 11/07/97 Page 9 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE CUST CUST# CON.# EFFEC. ANNIV. LEASE PRODUCT AMT. FL/GA COUNTY NAME QTY CUSTOMER NAME TYPE DATE DATE #YRS PRICE C&I ONLY DEKALB, GA 1 *** 01 3565748 0379272 511 07/01/97 07/01/98 1 405.00 405.00 DEKALB, GA 1 *** 37 3758218 2001559 201 08/21/97 08/21/98 1 95.20 95.20 DEKALB, GA 1 *** 01 3331677 3146390 407 06/15/97 06/15/98 1 405.00 405.00 DEKALB, GA 1 *** 50 3348990 3161699 326 08/31/97 08/31/98 1 285.45 285.45 DEKALB, GA 1 *** 50 3463866 0374898 617 12/31/97 12/31/98 1 295.00 295.00 DEKALB, GA 1 *** 50 3026551 0341738 615 05/28/97 05/28/98 1 235.22 235.22 DEKALB, GA 1 *** 01 3707720 8355277 634 04/10/97 04/10/98 1 212.77 212.77 DEKALB, GA 1 *** 01 2970864 0348990 609 04/30/97 04/30/98 1 185.55 185.55 DEKALB, GA 1 *** 53 3219861 0248564 015 01/01/97 01/01/98 1 0.00 0.00 DEKALB, GA 1 *** 53 3219861 0248564 015 01/01/97 01/01/98 1 230.62 230.62 DEKALB, GA 1 *** 50 3318117 0330923 705 06/10/97 06/10/98 1 0.00 0.00 DEKALB, GA 1 *** 50 3012086 3146369 406 06/14/97 06/14/98 1 405.00 405.00 DEKALB, GA 1 *** 50 3475593 2022446 101 04/03/97 04/03/98 1 403.75 403.75 DEKALB, GA 1 *** 53 3266735 0351843 610 04/10/97 04/10/98 1 154.28 154.28 DEKALB, GA 1 *** 50 3012075 0341749 950 08/01/97 08/01/98 1 285.45 285.45 DEKALB, GA 1 *** 01 3517363 0345474 711 10/01/97 10/01/98 1 133.97 133.97 DEKALB, GA 1 *** 01 3331688 3161588 337 02/01/97 02/01/98 1 405.00 405.00 DEKALB, GA 1 *** 50 3144237 0358131 604 06/14/97 06/14/98 1 256.25 256.25 DEKALB, GA 1 *** 01 3513240 3161658 440 11/12/97 11/12/98 1 194.70 194.70 DEKALB, GA 1 *** 01 3212978 2008543 101 09/10/96 09/10/97 1 205.00 205.00 DEKALB, GA 1 *** 50 3396814 0291044 800 09/12/97 09/12/98 1 256.25 256.25 DEKALB, GA 1 *** 01 3019988 0181514 156 05/10/97 05/10/98 1 405.00 405.00 DEKALB, GA 1 *** 54 3646436 2008530 200 07/27/97 07/27/98 1 405.00 405.00 DEKALB, GA 5 *** 87 3308736 8242962 100 12/30/97 12/30/98 1 0.00 0.00 DOUGLAS, GA 1 *** 87 3098778 0232104 205 01/10/98 01/10/99 1 0.00 0.00 DOUGLAS, GA 1 *** 53 3214266 3161878 405 06/15/97 06/15/98 1 132.83 132.83 DOUGLAS, GA 1 *** 51 3611513 0394437 503 06/01/97 06/01/98 1 132.83 132.83 DOUGLAS, GA 1 *** 53 3571383 0453956 213 07/28/96 07/28/97 1 122.50 122.50 DOUGLAS, GA 1 *** 01 3271724 0247892 920 02/27/97 02/27/98 1 78.19 78.19 DOUGLAS, GA 1 *** 50 3268438 3146403 425 07/10/97 07/10/98 1 103.95 103.95 DOUGLAS, GA 1 *** 38 3425875 8172794 400 06/10/97 06/10/98 1 0.00 0.00 DOUGLAS, GA 1 *** 87 3090167 0320891 800 12/28/97 12/28/98 1 0.00 0.00 DOUGLAS, GA 1 *** 85 3609938 3161712 400 04/28/97 04/28/98 1 0.00 0.00 Data as of 11/07/97 Page 10 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE CUST CUST# CON.# EFFEC. ANNIV. LEASE PRODUCT AMT. FL/GA COUNTY NAME QTY CUSTOMER NAME TYPE DATE DATE #YRS PRICE C&I ONLY DOUGLAS, GA 1 *** 99 0038841 0242868 100 12/28/97 12/28/98 1 0.00 0.00 DOUGLAS, GA 1 *** 37 3758218 2001659 206 08/21/97 08/21/98 1 91.80 91.80 DOUGLAS, GA 1 *** 54 3009763 0213146 206 08/15/97 08/15/98 1 201.25 201.25 DOUGLAS, GA 1 *** 50 3026551 0341738 714 05/28/97 05/28/98 1 211.20 211.20 DOUGLAS, GA 1 *** 01 3707720 8355277 640 04/10/97 04/10/98 1 163.01 163.01 DOUGLAS, GA 1 *** 01 3564183 0353722 601 06/17/97 06/17/98 1 136.94 136.94 DOUGLAS, GA 1 *** 53 3219861 0248564 922 01/01/97 01/01/98 1 0.00 0.00 DOUGLAS, GA 1 *** 53 3219861 0248564 922 01/01/97 01/01/98 1 181.12 181.12 DOUGLAS, GA 1 *** 50 3012075 0341749 955 08/01/97 08/01/98 1 211.20 211.20 DOUGLAS, GA 1 *** 01 3331688 0302429 702 02/01/97 02/01/98 1 380.00 380.00 DOUGLAS, GA 1 *** 99 3761465 2008428 200 09/13/97 09/13/98 1 201.25 201.25 DOUGLAS, GA 1 *** 12 3812985 2027006 001 10/08/97 10/08/98 1 273.11 273.11 DOUGLAS, GA 8 *** 87 3308736 8242868 100 12/30/97 12/30/98 1 0.00 0.00 DUVAL, FL 1 *** 01 3544886 0367089 600 03/22/97 03/22/98 1 965.00 965.00 DUVAL, FL 1 *** 50 3685118 0480442 402 09/30/97 09/30/98 1 965.00 965.00 DUVAL, FL 1 *** 99 2248864 0130038 400 06/07/97 06/07/98 1 387.75 387.75 DUVAL, FL 1 *** 87 3613103 0220266 100 04/15/97 04/15/98 1 0.00 0.00 DUVAL, FL 1 *** 87 3090167 0268778 301 08/07/97 08/07/98 1 0.00 0.00 DUVAL, FL 1 *** 99 3091641 8271268 100 12/05/97 12/05/98 1 0.00 0.00 DUVAL, FL 1 *** 37 3014600 3276128 100 08/14/97 08/14/98 1 0.00 0.00 DUVAL, FL 1 *** 44 3221880 2017777 000 08/12/97 08/12/98 1 965.00 965.00 DUVAL, FL 1 *** 01 3054154 0182799 200 06/10/97 06/10/98 1 387.75 387.75 DUVAL, FL 1 *** 39 3360796 0277782 900 10/30/97 10/30/98 1 0.00 0.00 DUVAL, FL 1 *** 53 2566722 0130020 401 07/10/97 07/10/98 1 398.75 398.75 DUVAL, FL 1 *** 01 2002419 0358229 601 09/30/97 09/30/98 1 621.50 621.50 DUVAL, FL 1 *** 01 3658057 0439723 500 02/25/98 02/25/99 1 1110.00 1110.00 DUVAL, FL 1 *** 19 3213870 0251561 100 01/10/98 01/10/99 1 1110.00 1110.00 DUVAL, FL 1 *** 01 3265664 0235601 000 07/10/97 07/10/98 1 457.50 457.50 DUVAL, FL 1 *** 54 2438124 0187553 600 06/25/97 06/25/98 1 457.50 457.50 DUVAL, FL 1 *** 54 2438124 0187553 700 06/25/97 06/25/98 1 0.00 0.00 DUVAL, FL 1 *** 01 3128086 2002259 202 06/15/97 06/15/98 1 965.00 965.00 DUVAL, FL 1 *** 50 2572648 2130545 502 11/04/97 11/04/98 1 447.15 447.15 DUVAL, FL 1 *** 01 2499257 8259961 000 03/17/97 03/17/98 1 965.00 965.00 Data as 11/07/97 Page 11 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE CUST CUST# CON.# EFFEC. ANNIV. LEASE PRODUCT AMT. FL/GA COUNTY NAME QTY CUSTOMER NAME TYPE DATE DATE #YRS PRICE C&I ONLY DUVAL, FL 1 *** 50 2486189 2017775 000 07/23/97 07/23/98 1 965.00 965.00 DUVAL, FL 8 *** 87 3308736 9271268 100 12/30/97 12/30/98 1 0.00 0.00 FAYETTE, GA 1 *** 87 3098778 0232104 206 01/10/98 01/10/99 1 0.00 0.00 FAYETTE, GA 1 *** 53 3214266 3146302 411 06/15/97 06/15/98 1 132.83 132.83 FAYETTE, GA 1 *** 50 3237511 0341742 702 07/14/97 07/14/98 1 211.20 211.20 FAYETTE, GA 1 *** 50 3702053 0228441 200 02/10/98 02/10/99 1 231.25 231.25 FAYETTE, GA 1 *** 50 3701362 0454303 301 04/01/97 04/01/98 1 201.25 201.25 FAYETTE, GA 1 *** 50 2304924 3161571 404 05/15/97 05/15/98 1 167.90 167.90 FAYETTE, GA 1 *** 87 3090167 0320893 800 12/28/97 12/28/98 1 0.00 0.00 FAYETTE, GA 1 *** 99 0038841 0242866 100 12/28/97 12/28/98 1 0.00 0.00 FAYETTE, GA 1 *** 50 3259865 2028115 001 06/16/97 06/16/98 1 132.45 132.45 FAYETTE, GA 1 *** 37 3758218 2001659 207 08/21/97 08/21/98 1 91.80 91.80 FAYETTE, GA 1 *** 52 3679843 0426737 408 08/10/97 08/10/98 1 211.20 211.20 FAYETTE, GA 1 *** 01 3707720 8355277 638 04/10/97 04/10/98 1 163.01 163.01 FAYETTE, GA 1 *** 53 3219861 0248564 926 01/01/97 01/01/98 1 0.00 0.00 FAYETTE, GA 1 *** 53 3219861 0248564 926 01/01/97 01/01/98 1 181.12 181.12 FAYETTE, GA 1 *** 11 3552919 3161301 400 04/10/97 04/10/98 1 132.80 132.80 FAYETTE, GA 1 *** 50 3012075 0341749 956 08/01/97 08/01/98 1 211.20 211.20 FAYETTE, GA 1 *** 50 3721160 3161359 403 12/10/97 12/10/98 1 152.63 152.63 FAYETTE, GA 1 *** 01 3331688 3161588 330 02/01/97 02/01/98 1 380.00 380.00 FAYETTE, GA 1 *** 01 3513240 3161658 439 11/12/97 11/12/98 1 152.62 152.62 FAYETTE, GA 1 *** 01 3019988 0181514 157 05/10/97 05/10/98 1 380.00 380.00 FAYETTE, GA 8 *** 87 3308736 8242866 100 12/30/97 12/30/98 1 0.00 0.00 FORSYTH, GA 1 *** 87 3098778 0232104 207 01/10/98 01/10/99 1 0.00 0.00 FORSYTH, GA 1 *** 50 2925677 0351712 612 09/30/97 09/30/98 1 211.20 211.20 FORSYTH, GA 1 *** 53 3214266 3161878 415 06/15/97 06/15/98 1 211.20 211.20 FORSYTH, GA 1 *** 50 3780079 0351786 600 04/19/97 04/19/98 1 380.00 380.00 FORSYTH, GA 1 *** 50 3121458 0452391 202 01/17/96 01/17/97 1 0.00 0.00 FORSYTH, GA 1 *** 51 3645833 0433758 506 01/15/98 01/15/99 1 231.25 231.25 FORSYTH, GA 1 *** 50 3542075 0453934 301 03/15/97 03/15/98 1 190.00 190.00 FORSYTH, GA 1 *** 50 3812084 2027009 001 09/26/97 09/26/98 1 221.13 221.13 FORSYTH, GA 1 *** 01 3271724 0247892 921 02/27/97 02/27/98 1 79.50 79.50 FORSYTH, GA 1 *** 50 3533619 0345394 612 05/01/97 05/01/98 1 0.00 0.00 Data as of 11/07/97 Page 12 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE CUST CUST# CON.# EFFEC. ANNIV. LEASE PRODUCT AMT. FL/GA COUNTY NAME QTY CUSTOMER NAME TYPE DATE DATE #YRS PRICE C&I ONLY FORSYTH, GA 1 *** 50 3268438 3146403 426 07/10/97 07/10/98 1 103.95 103.95 FORSYTH, GA 1 *** 50 3397084 0435407 400 04/12/97 04/12/98 1 190.08 190.08 FORSYTH, GA 1 *** 87 3090167 0320894 800 12/28/97 12/28/98 1 0.00 0.00 FORSYTH, GA 1 *** 99 0038841 0242883 100 12/28/97 12/28/98 1 0.00 0.00 FORSYTH, GA 1 *** 85 3796857 2018740 102 12/20/97 12/20/98 1 0.00 0.00 FORSYTH, GA 1 *** 37 3758218 2001659 208 09/20/97 09/20/98 1 101.20 101.20 FORSYTH, GA 1 *** 50 3538953 0349640 608 06/04/97 06/04/98 1 380.00 380.00 FORSYTH, GA 1 *** 50 3224573 0345482 727 01/30/98 01/30/99 1 260.00 260.00 FORSYTH, GA 1 *** 50 3348990 3161699 415 08/31/97 08/31/98 1 211.20 211.20 FORSYTH, GA 1 *** 50 3026551 0341738 713 05/28/97 05/28/98 1 179.32 179.32 FORSYTH, GA 1 *** 50 3811786 2021209 003 09/18/97 09/18/98 1 227.50 227.50 FORSYTH, GA 1 *** 01 3707720 8355277 641 04/10/97 04/10/98 1 172.80 172.80 FORSYTH, GA 1 *** 01 2970864 0348990 610 04/30/97 04/30/98 1 172.30 172.30 FORSYTH, GA 1 *** 01 3539938 0355268 621 09/15/97 09/15/98 1 211.20 211.20 FORSYTH, GA 1 *** 53 3219861 0248564 920 01/01/97 01/01/98 1 0.00 0.00 FORSYTH, GA 1 *** 53 3219861 0248564 920 01/01/97 01/01/98 1 181.12 181.12 FORSYTH, GA 1 *** 50 3012086 0205769 302 06/14/97 06/14/98 1 380.00 380.00 FORSYTH, GA 1 *** 53 3266735 0351843 612 04/10/97 04/10/98 1 117.98 117.98 FORSYTH, GA 1 *** 50 3012075 0341749 865 08/01/97 08/01/98 1 132.83 132.83 FORSYTH, GA 1 *** 50 3012075 0341749 957 08/01/97 08/01/98 1 132.83 132.83 FORSYTH, GA 1 *** 50 3012075 2000764 201 08/01/97 08/01/98 1 211.20 211.20 FORSYTH, GA 1 *** 50 3012075 2013809 100 11/02/96 11/02/97 1 380.00 380.00 FORSYTH, GA 1 *** 01 3774300 2020615 200 02/08/98 02/08/99 1 520.00 520.00 FORSYTH, GA 1 *** 01 3331688 3161588 329 02/01/97 02/01/98 1 380.00 380.00 FORSYTH, GA 1 *** 50 3746385 9414173 200 04/07/97 04/07/98 1 380.00 380.00 FORSYTH, GA 1 *** 01 3513240 2022494 100 08/08/97 08/08/98 1 380.00 380.00 FORSYTH, GA 1 *** 99 3751745 9414194 200 04/10/97 04/10/98 1 380.00 380.00 FORSYTH, GA 1 *** 51 3588068 0379210 603 02/02/98 02/02/99 1 244.20 244.20 FORSYTH, GA 1 *** 01 3103692 2008741 100 12/04/96 12/04/97 1 175.00 175.00 FORSYTH, GA 1 *** 02 3475526 3161745 402 09/10/97 09/10/98 1 0.00 0.00 FORSYTH, GA 1 *** 01 3429460 0351793 601 06/15/97 06/15/98 1 190.08 190.08 FORSYTH, GA 8 *** 87 3308736 8242883 400 12/30/97 12/30/98 1 0.00 0.00 FULTON, GA 1 *** 53 3214266 3146302 406 06/15/97 06/15/98 1 246.67 246.67 Data as of 11/07/97 Page 13 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE CUST CUST# CON.# EFFEC. ANNIV. LEASE PRODUCT AMT. FL/GA COUNTY NAME QTY CUSTOMER NAME TYPE DATE DATE #YRS PRICE C&I ONLY FULTON, GA 1 *** 52 3680238 0426742 422 11/05/97 11/05/98 1 520.00 520.00 FULTON, GA 1 *** 01 3480869 0324237 802 12/16/97 12/16/98 1 705.00 705.00 FULTON, GA 1 *** 50 3220823 3161872 402 06/15/97 06/15/98 1 404.25 404.25 FULTON, GA 1 *** 01 3271724 0247892 915 02/27/97 02/27/98 1 126.56 126.56 FULTON, GA 1 *** 50 3268438 3146403 415 07/10/97 07/10/98 1 192.90 192.90 FULTON, GA 1 *** 54 3803769 2028078 000 04/25/97 04/25/98 1 318.00 318.00 FULTON, GA 1 *** 87 3090167 0320895 800 12/28/97 12/28/98 1 0.00 0.00 FULTON, GA 1 *** 85 3609938 0454616 307 07/05/97 07/05/98 1 0.00 0.00 FULTON, GA 1 *** 38 3718650 0453860 301 10/01/97 10/01/98 1 190.00 190.00 FULTON, GA 1 *** 01 3331677 3146390 406 06/15/97 06/15/98 1 610.00 610.00 FULTON, GA 1 *** 50 3463866 0374898 618 12/31/97 12/31/98 1 430.00 430.00 FULTON, GA 1 *** 01 3707720 8355277 636 04/10/97 04/10/98 1 302.63 302.63 FULTON, GA 1 *** 50 3318117 0330923 703 10/20/97 10/20/98 1 237.50 237.50 FULTON, GA 1 *** 50 3012086 3146363 702 06/14/97 06/14/98 1 610.00 610.00 FULTON, GA 1 *** 50 3475593 2022446 200 06/01/97 06/01/98 1 475.00 475.00 FULTON, GA 1 *** 01 3331688 3161588 339 02/01/97 02/01/98 1 610.00 610.00 FULTON, GA 1 *** 54 3320943 0345468 709 08/10/97 08/10/98 1 404.25 404.25 FULTON, GA 1 *** 01 3513240 3161658 435 11/12/97 11/12/98 1 283.80 283.80 FULTON, GA 1 *** 01 3212978 3146307 325 09/10/96 09/10/97 1 299.00 299.00 FULTON, GA 1 *** 54 3646436 0433775 502 02/01/98 02/01/99 1 465.30 465.30 FULTON, GA 1 *** 01 3600049 0383560 518 03/01/97 03/01/98 1 610.00 610.00 FULTON, GA 1 *** 87 3098778 0232104 208 01/10/98 01/10/99 1 0.00 0.00 FULTON, GA 1 *** 50 2925677 0351712 610 09/30/97 09/30/98 1 285.45 285.45 FULTON, GA 1 *** 32 3500792 0341746 902 01/10/98 01/10/99 1 352.50 352.50 FULTON, GA 1 *** 32 3615113 0386162 501 09/04/97 09/04/98 1 305.00 305.00 FULTON, GA 1 *** 50 3518395 3161821 405 12/16/97 12/16/98 1 364.80 364.80 FULTON, GA 1 *** 50 3542075 0351789 614 03/15/97 03/15/98 1 152.50 152.50 FULTON, GA 1 *** 50 3812084 2027009 000 09/26/97 09/26/98 1 221.12 221.12 FULTON, GA 1 *** 50 3198779 8262398 100 01/10/98 01/10/99 1 543.00 543.00 FULTON, GA 1 *** 02 3755051 2001751 200 06/30/97 06/30/98 1 188.10 188.10 FULTON, GA 1 *** 01 3519758 0341694 633 07/10/97 07/10/98 1 156.68 156.68 FULTON, GA 1 *** 53 3571383 0453856 208 07/28/96 07/28/97 1 174.12 174.12 FULTON, GA 1 *** 01 3565748 0379272 510 07/01/97 07/01/98 1 305.00 305.00 Data as of 11/07/97 Page 14 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE CUST CUST# CON.# EFFEC. ANNIV. LEASE PRODUCT AMT. FL/GA COUNTY NAME QTY CUSTOMER NAME TYPE DATE DATE #YRS PRICE C&I ONLY FULTON, GA 1 *** 37 3758218 2001659 204 08/21/97 08/21/98 1 44.55 44.55 FULTON, GA 1 *** 50 3510690 3146420 400 06/10/97 06/10/98 1 405.00 405.00 FULTON, GA 1 *** 50 3224573 0345482 705 08/15/97 08/15/98 1 202.12 202.12 FULTON, GA 1 *** 50 3348990 3161699 327 08/31/97 08/31/98 1 285.45 285.45 FULTON, GA 1 *** 50 3026551 0181538 203 05/28/97 05/28/98 1 254.22 254.22 FULTON, GA 1 *** 50 3811786 2021209 000 09/18/97 09/18/98 1 287.50 287.50 FULTON, GA 1 *** 01 3564183 8353720 601 06/17/97 06/17/98 1 188.19 188.19 FULTON, GA 1 *** 01 2970864 0348990 611 04/30/97 04/30/98 1 205.88 205.88 FULTON, GA 1 *** 53 3219861 0248564 016 01/01/97 01/01/98 1 0.00 0.00 FULTON, GA 1 *** 53 3219861 0248564 016 01/01/97 01/01/98 1 168.19 168.19 FULTON, GA 1 *** 50 3318117 0330923 704 06/10/97 06/10/98 1 0.00 0.00 FULTON, GA 1 *** 50 3025967 0181533 300 02/21/98 02/21/99 1 465.00 465.00 FULTON, GA 1 *** 53 3266735 0351843 609 04/10/97 04/10/98 1 108.90 108.90 FULTON, GA 1 *** 50 3012075 0341749 670 08/01/97 08/01/98 1 196.35 196.35 FULTON, GA 1 *** 50 3012075 0341749 912 08/01/97 08/01/98 1 142.73 142.73 FULTON, GA 1 *** 50 3012075 0341749 925 08/01/97 08/01/98 1 405.00 405.00 FULTON, GA 1 *** 50 3012075 2000711 202 08/01/97 08/01/98 1 188.10 188.10 FULTON, GA 1 *** 01 3517363 0345474 716 10/01/97 10/01/98 1 92.00 92.00 FULTON, GA 1 *** 50 3144237 0358130 601 05/14/97 05/14/98 1 188.10 188.10 FULTON, GA 1 *** 50 3583063 0374671 603 11/10/97 11/10/98 1 141.90 141.90 FULTON, GA 1 *** 50 3396814 0291044 003 09/12/97 09/12/98 1 123.34 123.34 FULTON, GA 1 *** 01 3019988 0181514 158 05/10/97 05/10/98 1 305.00 305.00 FULTON, GA 1 *** 51 3589560 0379219 608 02/23/98 02/23/99 1 465.00 465.00 FULTON, GA 1 *** 99 3751745 9414194 201 04/10/97 04/10/98 1 360.00 360.00 FULTON, GA 1 *** 01 3103692 0227047 123 03/10/97 03/10/98 1 226.25 226.25 FULTON, GA 1 *** 10 3618224 0395886 524 07/29/97 07/06/98 1 0.00 0.00 FULTON, GA 1 *** 02 3475526 3161745 512 09/10/97 09/10/98 1 0.00 0.00 FULTON, GA 1 *** 50 3388901 0310773 801 10/25/97 10/25/98 1 232.65 232.65 FULTON, GA 1 *** 01 3429460 3161813 406 06/15/97 06/15/98 1 169.29 169.29 FULTON, GA 1 *** 87 3098778 0232104 208 01/10/98 01/10/99 1 0.00 0.00 FULTON, GA 1 *** 32 3500792 0341746 902 01/10/98 01/10/99 1 352.50 352.50 FULTON, GA 1 *** 32 3615113 0386162 501 09/04/97 09/04/98 1 305.00 305.00 FULTON, GA 1 *** 50 3542075 0351789 614 03/15/97 03/15/98 1 152.50 152.50 Data as of 11/07/97 Page 15 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE CUST CUST# CON.# EFFEC. ANNIV. LEASE PRODUCT AMT. FL/GA COUNTY NAME QTY CUSTOMER NAME TYPE DATE DATE #YRS PRICE C&I ONLY FULTON, GA 1 *** 01 3519758 0341694 633 071/0/97 071/0/98 1 156.68 156.68 FULTON, GA 1 *** 53 3571383 0453865 200 07/28/96 07/28/97 1 0.00 0.00 FULTON, GA 1 *** 50 2304924 3161571 402 05/10/97 05/10/98 1 315.15 315.15 FULTON, GA 1 *** 50 3259865 2028115 002 06/16/97 06/16/98 1 245.98 245.98 FULTON, GA 1 *** 01 3565748 0379272 510 07/01/97 07/01/98 1 305.00 305.00 FULTON, GA 1 *** 37 3758218 2001659 204 08/21/97 08/21/98 1 44.55 44.55 FULTON, GA 1 *** 52 3679843 0426737 409 08/26/97 08/26/98 1 285.45 285.45 FULTON, GA 1 *** 51 3778449 2022323 100 04/03/97 04/03/98 1 326.66 326.66 FULTON, GA 1 *** 50 3224573 0345482 705 08/15/97 08/15/98 1 202.13 202.13 FULTON, GA 1 *** 50 3026551 0181538 204 08/29/97 08/29/98 1 259.50 259.50 FULTON, GA 1 *** 01 2970864 0348990 611 04/30/97 04/30/98 1 205.88 205.88 FULTON, GA 1 *** 53 3219861 0248564 016 01/01/97 01/01/98 1 0.00 0.00 FULTON, GA 1 *** 53 3219861 0248564 016 01/01/97 01/01/98 1 168.19 168.19 FULTON, GA 1 *** 50 3318117 0330923 704 06/10/97 06/10/98 1 0.00 0.00 FULTON, GA 1 *** 53 3266735 0351843 609 04/10/97 04/10/98 1 108.90 108.90 FULTON, GA 1 *** 50 3012075 0341749 670 08/01/97 08/01/98 1 196.35 196.35 FULTON, GA 1 *** 01 3517363 0345474 716 10/01/97 10/01/98 1 97.75 97.75 FULTON, GA 1 *** 50 3583063 0374671 603 11/10/97 11/10/98 1 141.90 141.90 FULTON, GA 1 *** 50 3396814 0291044 003 09/12/97 09/12/98 1 123.34 123.34 FULTON, GA 1 *** 01 3019988 0181514 158 05/10/97 05/10/98 1 305.00 305.00 FULTON, GA 1 *** 10 3618224 0395886 524 07/29/97 07/06/98 1 0.00 0.00 FULTON, GA 1 *** 50 3388901 0310773 801 10/25/97 10/25/98 1 232.65 232.65 FULTON, GA 2 *** 99 3091641 0242866 100 12/28/97 12/28/98 1 0.00 0.00 FULTON, GA 4 *** 38 3313101 2001040 100 07/22/97 07/22/98 1 0.00 0.00 FULTON, GA 4 *** 38 3313101 2001040 100 07/22/97 07/22/98 1 0.00 0.00 FULTON, GA 5 *** 87 3308736 8242865 100 12/30/97 12/30/98 1 0.00 0.00 GWINNETT, GA 1 *** 87 3098778 0232104 209 01/10/98 01/10/99 1 0.00 0.00 GWINNETT, GA 1 *** 53 3214266 3146302 409 06/15/97 06/15/98 1 169.12 169.12 GWINNETT, GA 1 *** 01 3584886 0379201 404 06/10/97 06/10/98 1 405.00 405.00 GWINNETT, GA 1 *** 50 3504581 0341883 701 06/13/97 06/13/98 1 256.25 256.25 GWINNETT, GA 1 *** 01 3674462 2001643 200 07/09/97 07/09/98 1 405.00 405.00 GWINNETT, GA 1 *** 52 3680238 2022338 100 05/31/97 05/31/98 1 405.00 405.00 GWINNETT, GA 1 *** 01 3480869 0438768 508 12/16/97 12/16/98 1 465.00 465.00 Data as of 11/07/97 Page 16 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE CUST CUST# CON.# EFFEC. ANNIV. LEASE PRODUCT AMT. FL/GA COUNTY NAME QTY CUSTOMER NAME TYPE DATE DATE #YRS PRICE C&I ONLY GWINNETT, GA 1 *** 01 3500758 0341867 701 07/16/97 07/16/98 1 189.55 189.55 GWINNETT, GA 1 *** 50 3542075 0351789 618 03/15/97 03/15/98 1 202.50 202.50 GWINNETT, GA 1 *** 50 3482636 0324075 702 02/15/97 02/15/98 1 405.00 405.00 GWINNETT, GA 1 *** 01 3519758 0341694 624 07/10/97 07/10/98 1 218.76 218.76 GWINNETT, GA 1 *** 54 3792401 2030389 100 10/23/97 10/23/98 1 274.54 274.54 GWINNETT, GA 1 *** 53 3571383 0453856 211 07/28/96 07/28/97 1 156.62 156.62 GWINNETT, GA 1 *** 50 3127694 0230026 102 07/03/97 07/03/98 1 405.00 405.00 GWINNETT, GA 1 *** 51 3795013 2018643 100 11/26/97 11/26/98 1 550.00 550.00 GWINNETT, GA 1 *** 51 3713622 0461640 300 06/06/97 06/06/98 1 405.00 405.00 GWINNETT, GA 1 *** 01 3271724 0247892 916 02/27/97 02/27/98 1 102.94 102.94 GWINNETT, GA 1 *** 50 3268438 3146403 424 07/10/97 07/10/98 1 132.90 132.90 GWINNETT, GA 1 *** 87 3090167 0271334 100 12/28/97 12/28/98 1 0.00 0.00 GWINNETT, GA 1 *** 86 3609938 0461616 308 07/05/97 07/05/98 1 0.00 0.00 GWINNETT, GA 1 *** 99 0038841 0242864 100 12/28/97 12/28/98 1 0.00 0.00 GWINNETT, GA 1 *** 50 3453232 0311030 809 10/21/97 10/21/98 1 0.00 0.00 GWINNETT, GA 1 *** 01 3565748 0379272 601 07/01/97 07/01/98 1 256.25 256.25 GWINNETT, GA 1 *** 44 3577426 3161641 406 03/10/97 03/10/98 1 405.00 405.00 GWINNETT, GA 1 *** 37 3758218 2001659 301 10/19/97 10/19/98 1 62.10 62.10 GWINNETT, GA 1 *** 38 3200894 3071759 304 07/28/97 07/28/98 1 0.00 0.00 GWINNETT, GA 1 *** 02 3562558 0353670 601 05/29/97 05/29/98 1 285.45 285.45 GWINNETT, GA 1 *** 51 3610039 0395837 500 05/07/97 05/07/98 1 405.00 405.00 GWINNETT, GA 1 *** 50 2999632 0213788 304 11/21/97 11/21/98 1 328.35 328.35 GWINNETT, GA 1 *** 50 3224573 0345482 716 08/15/97 08/15/98 1 285.45 285.45 GWINNETT, GA 1 *** 51 3654433 0435417 506 02/23/98 02/23/99 1 328.35 328.35 GWINNETT, GA 1 *** 01 3615089 0386062 501 06/11/97 06/11/98 1 256.25 256.25 GWINNETT, GA 1 *** 01 3331677 3146390 405 06/15/97 06/15/98 1 405.00 405.00 GWINNETT, GA 1 *** 50 3348990 0206516 203 08/31/97 08/31/98 1 285.45 285.45 GWINNETT, GA 1 *** 50 3463866 0374898 613 12/31/97 12/31/98 1 295.00 295.00 GWINNETT, GA 1 *** 50 3026551 0341682 715 05/28/97 05/28/98 1 328.23 328.23 GWINNETT, GA 1 *** 50 3811786 2021209 001 09/18/97 09/18/98 1 287.50 287.50 GWINNETT, GA 1 *** 01 3707720 8355277 635 04/10/97 04/10/98 1 212.76 212.76 GWINNETT, GA 1 *** 01 2970864 0348990 612 04/30/97 04/30/98 1 185.55 185.55 GWINNETT, GA 1 *** 01 3539938 0355268 609 09/15/97 09/15/98 1 256.25 256.25 Data as of 11/07/97 Page 17 11/20/97
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Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE COUNTRY NAME QTY CUSTOMER NAME CUST CUST# CON.# EFFEC. ANNIV LEASE PRODUCT AMT,FL/GA TYPE DATE DATE #YRS PRICE C&I ONLY GWINNETT, GA 1 *** 53 3219861 0248564 017 01/01/97 01/01/98 1 0.00 0.00 GWINNETT, GA 1 *** 53 3219861 0248564 017 01/01/97 01/01/98 1 230.63 230.63 GWINNETT, GA 1 *** 50 3318117 0330923 711 11/04/97 11/04/98 1 237.50 237.50 GWINNETT, GA 1 *** 50 3318117 0330923 715 06/10/97 06/10/98 1 0.00 0.00 GWINNETT, GA 1 *** 50 3012086 3146369 408 06/14/97 06/14/98 1 405.00 405.00 GWINNETT, GA 1 *** 50 3475593 2022446 103 04/03/97 04/03/98 1 403.75 403.75 GWINNETT, GA 1 *** 53 3266735 0271825 001 10/10/97 10/10/98 1 169.13 169.13 GWINNETT, GA 1 *** 50 3012075 0341749 864 08/01/97 08/01/98 1 169.13 169.13 GWINNETT, GA 1 *** 50 3012075 0341749 919 08/01/97 08/01/98 1 169.13 169.13 GWINNETT, GA 1 *** 50 3012075 0341749 951 08/01/97 08/01/98 1 285.45 285.45 GWINNETT, GA 1 *** 50 3537729 0349633 608 08/01/97 08/01/98 1 285.45 285.45 GWINNETT, GA 1 *** 50 3110300 0374613 601 08/20/97 08/20/98 1 256.25 256.25 GWINNETT, GA 1 *** 01 3517363 0345474 712 10/14/97 10/14/98 1 133.93 133.93 GWINNETT, GA 1 *** 01 3525298 3161606 402 06/25/97 06/25/98 1 169.13 169.13 GWINNETT, GA 1 *** 01 3331688 3161588 338 02/01/97 02/01/98 1 405.00 405.00 GWINNETT, GA 1 *** 50 3748026 2022464 101 05/24/97 05/24/98 1 475.00 475.00 GWINNETT, GA 1 *** 50 3375932 3161826 402 05/28/97 05/28/98 1 405.00 405.00 GWINNETT, GA 1 *** 02 3774744 2008089 101 10/10/97 10/10/98 1 170.00 170.00 GWINNETT, GA 1 *** 50 3590210 0379218 602 02/15/98 02/15/99 1 328.35 328.35 GWINNETT, GA 1 *** 50 3590221 0379217 602 02/15/98 02/15/99 1 328.35 328.35 GWINNETT, GA 1 *** 01 3513240 3161658 436 11/12/97 11/12/98 1 194.70 194.70 GWINNETT, GA 1 *** 01 3212978 3146307 326 09/10/96 09/10/97 1 205.00 205.00 GWINNETT, GA 1 *** 51 3805389 2017755 000 05/21/97 05/21/98 1 475.00 475.00 GWINNETT, GA 1 *** 50 3396814 0341720 802 09/12/97 09/12/98 1 256.25 256.25 GWINNETT, GA 1 *** 54 3646436 2008629 200 08/02/97 08/02/98 1 405.00 405.00 GWINNETT, GA 1 *** 51 3589560 0379219 607 02/23/98 02/23/99 1 465.00 465.00 GWINNETT, GA 1 *** 51 3744468 9415765 200 05/01/97 05/01/98 1 285.45 285.45 GWINNETT, GA 1 *** 50 3751262 2001702 200 08/23/97 08/23/98 1 256.25 256.25 GWINNETT, GA 1 *** 51 3588068 0379210 602 02/10/98 02/10/99 1 328.35 328.35 GWINNETT, GA 1 *** 01 3103692 0227047 325 03/10/97 03/10/98 1 221.25 221.25 GWINNETT, GA 1 *** 12 3812985 2027006 002 10/08/97 10/08/98 1 216.11 216.11 GWINNETT, GA 1 *** 01 3600049 0383560 519 03/01/97 03/01/98 1 405.00 405.00 GWINNETT, GA 1 *** 51 3796687 2028067 100 06/27/97 06/27/98 1 475.00 475.00
PAGE 18 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexB.XLS, EXPERIAN CONFIDENTIAL
Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE COUNTRY NAME QTY CUSTOMER NAME CUST CUST# CON.# EFFEC. ANNIV LEASE PRODUCT AMT,FL/GA TYPE DATE DATE #YRS PRICE C&I ONLY GWINNETT, GA 1 *** 02 3475526 3161745 505 09/10/97 09/10/98 1 0.00 0.00 GWINNETT, GA 1 *** 01 3429460 3146377 405 06/15/97 06/15/98 1 230.61 230.61 GWINNETT, GA 5 *** 87 3308736 8242864 100 12/30/97 12/30/98 1 0.00 0.00 GWINNETT, GA 8 *** 38 3200894 3071759 500 06/10/97 06/10/98 1 0.00 0.00 HALL, GA 1 *** 87 3098778 0232104 210 01/10/98 01/10/99 1 0.00 0.00 HALL, GA 1 *** 53 3214266 3146302 412 06/15/97 06/15/98 1 211.20 211.20 HALL, GA 1 *** 51 3795013 2028063 000 03/18/97 03/18/98 1 251.75 251.75 HALL, GA 1 *** 87 3090167 0320898 800 12/28/97 12/28/98 1 0.00 0.00 HALL, GA 1 *** 99 0038841 9410090 100 05/24/97 05/24/98 1 0.00 0.00 HALL, GA 1 *** 99 3091641 0242863 100 12/28/97 12/28/98 1 0.00 0.00 HALL, GA 1 *** 44 3577426 3161641 407 03/10/97 03/10/98 1 380.00 380.00 HALL, GA 1 *** 37 3758218 2001659 209 08/21/97 08/21/98 1 145.20 145.20 HALL, GA 1 *** 10 3783870 2018685 100 06/13/97 06/13/98 1 150.15 150.15 HALL, GA 1 *** 50 2321325 0302129 704 04/03/97 04/03/98 1 211.20 211.20 HALL, GA 1 *** 50 3224573 2001797 201 07/27/97 07/27/98 1 211.20 211.20 HALL, GA 1 *** 51 3654433 2017753 000 04/23/97 04/23/98 1 288.00 288.00 HALL, GA 1 *** 01 3539938 0355268 620 09/15/97 09/15/98 1 211.20 211.20 HALL, GA 1 *** 53 3219861 0248564 923 01/01/97 01/01/98 1 0.00 0.00 HALL, GA 1 *** 53 3219861 0248564 923 01/01/97 01/01/98 1 181.12 181.12 HALL, GA 1 *** 50 3012086 2022339 100 06/14/97 06/14/98 1 380.00 380.00 HALL, GA 1 *** 53 3266735 0351843 611 04/10/97 04/10/98 1 117.98 117.98 HALL, GA 1 *** 50 3012075 0341749 914 08/01/97 08/01/98 1 380.00 380.00 HALL, GA 1 *** 50 3012075 0341749 943 08/01/97 08/01/98 1 211.20 211.20 HALL, GA 1 *** 50 3012075 0341749 958 08/01/97 08/01/98 1 211.20 211.20 HALL, GA 1 *** 50 3537729 0349633 607 08/01/97 08/01/98 1 202.50 202.50 HALL, GA 1 *** 01 3331688 3161588 331 02/01/97 02/01/98 1 380.00 380.00 HALL, GA 1 *** 02 3774744 2008090 200 02/15/98 02/15/99 1 244.20 244.20 HALL, GA 1 *** 50 3751262 2001702 201 05/23/97 05/23/98 1 132.83 132.83 HALL, GA 1 *** 50 3751273 2001703 201 05/30/97 05/30/98 1 87.63 87.63 HALL, GA 1 *** 01 3429460 3146377 501 06/15/97 06/15/98 1 190.08 190.08 HALL, GA 4 *** 38 3347607 8152111 400 07/28/97 07/28/98 1 0.00 0.00 HALL, GA 8 *** 87 3308736 8242863 100 12/30/97 12/30/98 1 0.00 0.00 HENRY, GA 1 *** 53 3214266 0302431 805 06/19/97 06/19/98 1 380.00 380.00
PAGE 19 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexB.XLS, EXPERIAN CONFIDENTIAL
Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE COUNTRY NAME QTY CUSTOMER NAME CUST CUST# CON.# EFFEC. ANNIV LEASE PRODUCT AMT,FL/GA TYPE DATE DATE #YRS PRICE C&I ONLY HENRY, GA 1 *** 50 3808870 2050023 000 07/21/97 07/21/98 1 237.60 237.60 HENRY, GA 1 *** 01 3271724 0438774 402 02/27/97 02/27/98 1 96.00 96.00 HENRY, GA 1 *** 87 3090167 0320899 800 12/28/97 12/28/98 1 0.00 0.00 HENRY, GA 1 *** 99 0038841 0031247 202 01/19/98 01/19/99 1 0.00 0.00 HENRY, GA 1 *** 50 3259865 2028115 003 06/16/97 06/16/98 1 233.10 233.10 HENRY, GA 1 *** 52 3679843 2008631 200 08/26/97 08/26/98 1 211.20 211.20 HENRY, GA 1 *** 01 3218927 0353661 504 11/06/97 11/06/98 1 440.00 440.00 HENRY, GA 1 *** 53 3219861 0248564 925 01/01/97 01/01/98 1 0.00 0.00 HENRY, GA 1 *** 53 3219861 0248564 925 01/01/97 01/01/98 1 201.38 201.38 HENRY, GA 1 *** 50 3488261 0351796 604 03/10/97 03/10/98 1 120.75 120.75 HENRY, GA 1 *** 01 3019988 0181514 005 08/15/97 08/15/98 1 380.00 380.00 HENRY, GA 8 *** 87 3308736 0150895 500 11/30/97 11/30/98 1 0.00 0.00 HILLSBOROUGH, FL 1 *** 01 3409664 0302309 802 04/10/97 04/10/98 1 449.50 449.50 HILLSBOROUGH, FL 1 *** 01 2327006 2015993 101 02/13/97 02/13/98 1 702.00 702.00 HILLSBOROUGH, FL 1 *** 50 2103895 2130772 301 05/10/96 05/10/97 1 680.00 680.00 HILLSBOROUGH, FL 1 *** 01 3614651 0409315 502 10/01/97 10/01/98 1 465.00 465.00 HILLSBOROUGH, FL 1 *** 01 2814267 2156386 303 05/10/97 05/10/98 1 685.00 685.00 HILLSBOROUGH, FL 1 *** 50 2174516 2125072 403 03/14/97 03/14/98 1 780.00 780.00 HILLSBOROUGH, FL 1 *** 87 3613103 0220264 100 04/15/97 04/15/98 1 0.00 0.00 HILLSBOROUGH, FL 1 *** 01 3229963 0251165 001 04/10/97 04/10/98 1 0.00 0.00 HILLSBOROUGH, FL 1 *** 01 3229963 2028139 000 03/10/97 03/10/98 1 0.00 0.00 HILLSBOROUGH, FL 1 *** 87 3090167 0258778 600 08/07/97 08/07/98 1 0.00 0.00 HILLSBOROUGH, FL 1 *** 99 0038841 0300077 101 12/05/97 12/05/98 1 0.00 0.00 HILLSBOROUGH, FL 1 *** 37 3014600 0207125 300 09/30/97 09/30/98 1 0.00 0.00 HILLSBOROUGH, FL 1 *** 53 2016539 2130450 702 01/30/98 01/30/99 1 797.97 797.97 HILLSBOROUGH, FL 1 *** 01 3729595 0459312 302 01/01/98 01/01/99 1 785.00 785.00 HILLSBOROUGH, FL 1 *** 38 2133380 2130413 401 12/10/96 12/10/97 1 678.75 678.75 HILLSBOROUGH, FL 1 *** 01 2227533 2160774 502 12/10/97 12/10/98 1 654.00 654.00 HILLSBOROUGH, FL 1 *** 01 3472464 0323542 801 08/10/97 08/10/98 1 780.00 780.00 HILLSBOROUGH, FL 1 *** 01 2943534 0213602 203 06/10/97 06/10/98 1 780.00 780.00 HILLSBOROUGH, FL 1 *** 01 3120783 0211713 303 06/10/97 06/10/98 1 780.00 780.00 HILLSBOROUGH, FL 1 *** 01 3774711 2026766 101 09/12/97 09/12/98 1 780.00 780.00 HILLSBOROUGH, FL 1 *** 50 3030022 2018269 200 02/21/98 02/21/99 1 1325.00 1325.00
PAGE 20 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexB.XLS, EXPERIAN CONFIDENTIAL
Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE COUNTRY NAME QTY CUSTOMER NAME CUST CUST# CON.# EFFEC. ANNIV LEASE PRODUCT AMT,FL/GA TYPE DATE DATE #YRS PRICE C&I ONLY HILLSBOROUGH, FL 1 *** 01 3455564 0323476 801 05/01/97 05/01/98 1 788.00 788.00 HILLSBOROUGH, FL 4 *** 38 3151435 0232699 200 07/14/97 07/14/98 1 0.00 0.00 HILLSBOROUGH, FL 8 *** 87 3308736 8271269 100 12/30/97 12/30/98 1 0.00 0.00 ORANGE, FL 1 *** 01 2124016 2146280 402 09/30/97 09/30/98 1 0.00 0.00 ORANGE, FL 1 *** 01 3707753 0452612 306 04/12/97 04/12/98 1 760.00 760.00 ORANGE, FL 1 *** 50 2246660 0166425 302 07/10/96 07/10/97 1 0.00 0.00 ORANGE, FL 1 *** 01 2281193 0219404 002 12/10/96 12/10/97 1 615.00 615.00 ORANGE, FL 1 *** 01 2525859 0277343 701 12/01/96 12/01/97 1 0.00 0.00 ORANGE, FL 1 *** 14 2524650 2166168 400 06/10/97 06/10/98 1 825.11 825.11 ORANGE, FL 1 *** 01 2782298 0166396 403 10/10/97 10/10/98 1 683.75 683.75 ORANGE, FL 1 *** 12 2972778 0211755 301 01/10/98 01/10/99 1 694.00 694.00 ORANGE, FL 1 *** 01 2743297 0166486 401 09/10/97 09/10/98 1 361.35 361.35 ORANGE, FL 1 *** 87 3613103 0186716 100 12/28/97 12/28/98 1 0.00 0.00 ORANGE, FL 1 *** 87 3090167 0284988 900 12/28/97 12/28/98 1 0.00 0.00 ORANGE, FL 1 *** 99 0038841 0271275 300 12/28/97 12/28/98 1 0.00 0.00 ORANGE, FL 1 *** 43 3676334 0189884 402 03/01/97 03/01/98 1 531.25 531.25 ORANGE, FL 1 *** 37 3014600 2160342 500 10/30/97 10/30/98 1 0.00 0.00 ORANGE, FL 1 *** 37 2462851 0334219 701 03/10/97 03/10/98 1 760.00 760.00 ORANGE, FL 1 *** 01 2222754 0251195 001 06/15/97 06/15/98 1 760.00 760.00 ORANGE, FL 1 *** 19 2300535 2166016 405 02/10/97 02/10/98 1 0.00 0.00 ORANGE, FL 1 *** 68 2255435 0358245 603 08/10/97 08/10/98 1 507.37 507.37 ORANGE, FL 1 *** 01 2002419 2166143 504 06/10/97 06/10/98 1 380.00 380.00 ORANGE, FL 1 *** 01 2011985 2166158 302 11/10/96 11/10/97 1 507.40 507.40 ORANGE, FL 1 *** 01 3807695 2017783 000 06/30/97 06/30/98 1 817.00 817.00 ORANGE, FL 1 *** 50 3342811 0208136 201 04/10/97 04/10/98 1 825.00 825.00 ORANGE, FL 1 *** 01 2778633 0166475 402 09/10/97 09/10/98 1 760.00 760.00 ORANGE, FL 1 *** 02 3388923 8278680 801 01/10/97 01/10/98 1 0.00 0.00 ORANGE, FL 1 *** 54 2236904 0462048 203 02/16/97 02/16/98 1 760.00 760.00 ORANGE, FL 1 *** 50 3627303 8433820 503 08/30/97 08/30/98 1 760.00 760.00 ORANGE, FL 7 *** 87 3308736 8271275 100 12/30/97 12/30/98 1 0.00 0.00 PALM BEACH, FL 1 *** 01 2337799 2123381 402 04/10/97 04/10/98 1 784.57 784.57 PALM BEACH, FL 1 *** 01 2989020 0175906 300 08/10/97 08/10/98 1 784.57 784.57 PALM BEACH, FL 1 *** 01 2012003 0462283 300 08/10/97 08/10/98 2 810.00 1620.00
PAGE 21 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexB.XLS, EXPERIAN CONFIDENTIAL
Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE COUNTRY NAME QTY CUSTOMER NAME CUST CUST# CON.# EFFEC. ANNIV LEASE PRODUCT AMT,FL/GA TYPE DATE DATE #YRS PRICE C&I ONLY PALM BEACH, FL 1 *** 54 2213082 0187409 408 05/10/97 05/10/98 1 1395.00 1395.00 PALM BEACH, FL 1 *** 01 2255727 2179313 400 05/01/97 05/01/98 1 784.58 784.58 PALM BEACH, FL 1 *** 01 2300728 2151658 400 03/10/97 03/10/98 1 780.64 780.64 PALM BEACH, FL 1 *** 01 2124016 2146279 401 04/01/97 04/01/98 1 523.05 523.05 PALM BEACH, FL 1 *** 01 3192694 2020690 202 11/30/97 11/30/98 1 1260.00 1260.00 PALM BEACH, FL 1 *** 01 3449718 2002174 001 04/10/97 04/10/98 1 1095.00 1095.00 PALM BEACH, FL 1 *** 01 3576629 0375362 606 10/10/97 10/10/98 1 846.00 846.00 PALM BEACH, FL 1 *** 51 3147416 8321927 801 01/10/98 01/10/99 1 1262.00 1262.00 PALM BEACH, FL 1 *** 87 3613103 0220272 100 04/28/97 04/28/98 1 0.00 0.00 PALM BEACH, FL 1 *** 01 3616345 0408846 603 12/10/97 12/10/98 1 445.00 445.00 PALM BEACH, FL 1 *** 87 3090167 0271317 100 12/28/97 12/28/98 1 0.00 0.00 PALM BEACH, FL 1 *** 99 0038841 0271272 101 12/28/97 12/28/98 1 0.00 0.00 PALM BEACH, FL 1 *** 01 2773504 0187423 402 08/10/97 08/10/98 1 392.29 392.29 PALM BEACH, FL 1 *** 37 3014600 0179053 400 05/07/97 05/07/98 1 0.00 0.00 PALM BEACH, FL 1 *** 37 3673115 0445335 401 07/01/97 07/01/98 1 1061.00 1061.00 PALM BEACH, FL 1 *** 53 2308416 2123376 402 05/05/97 05/05/98 1 413.34 413.34 PALM BEACH, FL 1 *** 01 3756964 2007364 202 08/01/97 08/01/98 1 480.00 480.00 PALM BEACH, FL 1 *** 01 2210201 0263980 001 08/17/97 08/17/98 1 392.29 392.29 PALM BEACH, FL 1 *** 01 3026283 8182450 203 02/28/97 02/28/98 1 1340.00 1340.00 PALM BEACH, FL 1 *** 01 3681790 0503384 303 08/28/96 08/28/97 1 0.00 0.00 PALM BEACH, FL 1 *** 50 2003540 2179302 401 05/01/97 05/01/98 1 695.00 695.00 PALM BEACH, FL 1 *** 50 2952051 0205845 302 11/10/97 11/10/98 1 978.65 978.65 PALM BEACH, FL 1 *** 38 2709594 2015790 102 10/28/97 10/28/98 1 0.00 0.00 PALM BEACH, FL 1 *** 01 2743938 2190126 402 05/19/97 05/19/98 1 1095.00 1095.00 PALM BEACH, FL 1 *** 51 3805068 2017709 001 06/30/97 06/30/98 1 1115.00 1115.00 PALM BEACH, FL 1 *** 01 2264402 0187465 401 06/10/97 06/10/98 1 1091.00 1091.00 PALM BEACH, FL 1 *** 01 2014881 2084351 301 04/25/97 04/25/98 1 694.20 694.20 PALM BEACH, FL 1 *** 50 2162537 2002360 201 04/10/97 04/10/98 1 1095.00 1095.00 PALM BEACH, FL 1 *** 01 3722516 0386331 401 04/10/97 04/10/98 1 1095.00 1095.00 PALM BEACH, FL 1 *** 61 2309844 0176513 301 11/29/97 11/29/98 1 0.00 0.00 PALM BEACH, FL 1 *** 01 3752427 2007221 203 06/30/97 06/30/98 1 0.00 0.00 PALM BEACH, FL 1 *** 01 2795395 2017695 000 05/05/97 05/05/98 1 1095.00 1095.00 PALM BEACH, FL 8 *** 87 3308736 8271272 100 12/30/97 12/30/98 1 0.00 0.00
PAGE 22 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexB.XLS, EXPERIAN CONFIDENTIAL
Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE COUNTRY NAME QTY CUSTOMER NAME CUST CUST# CON.# EFFEC. ANNIV LEASE PRODUCT AMT,FL/GA TYPE DATE DATE #YRS PRICE C&I ONLY PINELLAS, FL 1 *** 01 3409664 0304072 802 04/10/97 04/10/98 1 437.29 437.29 PINELLAS, FL 1 *** 50 2-74516 0208134 203 03/14/97 03/14/98 1 780.00 780.00 PINELLAS, FL 1 *** 87 3613103 0949020 300 12/28/97 12/28/98 1 0.00 0.00 PINELLAS, FL 1 *** 01 3229963 2028139 001 03/10/97 03/10/98 1 0.00 0.00 PINELLAS, FL 1 *** 50 3031238 0213657 001 01/10/96 01/10/97 1 0.00 0.00 PINELLAS, FL 1 *** 87 3090167 0271318 100 12/28/97 12/28/98 1 0.00 0.00 PINELLAS, FL 1 *** 99 0038841 0271276 001 05/21/97 05/21/98 1 0.00 0.00 PINELLAS, FL 1 *** 43 3676334 0189887 402 03/01/97 03/01/98 1 658.75 658.75 PINELLAS, FL 1 *** 37 3014600 0187527 300 08/27/97 08/27/98 1 0.00 0.00 PINELLAS, FL 1 *** 01 2-24083 0187305 503 12/10/97 12/10/98 1 1345.00 1345.00 PINELLAS, FL 1 *** 50 3776654 2018317 100 03/12/97 03/12/98 1 1030.73 1030.73 PINELLAS, FL 1 *** 53 2016539 0226857 403 01/30/98 01/30/99 1 523.20 523.20 PINELLAS, FL 1 *** 01 3729595 0459311 402 01/01/98 01/01/99 1 980.00 980.00 PINELLAS, FL 1 *** 38 2811194 8160371 300 04/28/97 04/28/98 1 0.00 0.00 PINELLAS, FL 1 *** 01 3-20783 0322393 701 06/10/97 06/10/98 1 1170.00 1170.00 PINELLAS, FL 1 *** 50 3030022 2018268 100 02/21/97 02/21/98 1 721.50 721.50 PINELLAS, FL 1 *** 01 2958732 0213317 301 05/10/97 05/10/98 1 1170.00 1170.00 PINELLAS, FL 8 *** 87 3308736 8271276 100 12/30/97 12/30/98 1 0.00 0.00 ROCKDALE, GA 1 *** 87 3098778 0232104 211 01/10/98 01/10/99 1 0.00 0.00 ROCKDALE, GA 1 *** 50 3490994 0461639 301 06/06/97 06/06/98 1 201.25 201.25 ROCKDALE, GA 1 *** 53 3214266 0248316 001 06/15/97 06/15/98 1 105.60 105.60 ROCKDALE, GA 1 *** 50 3121458 0441571 401 05/20/97 05/20/98 1 380.00 380.00 ROCKDALE, GA 1 *** 01 3271724 0341687 602 02/27/97 02/27/98 1 78.19 78.19 ROCKDALE, GA 1 *** 87 3090167 0320816 800 12/28/97 12/28/98 1 0.00 0.00 ROCKDALE, GA 1 *** 99 0038841 0271251 100 12/28/97 12/28/98 1 0.00 0.00 ROCKDALE, GA 1 *** 37 3758218 2001659 210 08/21/97 08/21/98 1 91.80 91.80 ROCKDALE, GA 1 *** 50 3348990 3161699 414 08/31/97 08/31/98 1 211.20 211.20 ROCKDALE, GA 1 *** 01 3707720 8355277 639 04/10/97 04/10/98 1 163.01 163.01 ROCKDALE, GA 1 *** 50 2966854 0341645 600 06/01/97 06/01/98 1 132.83 132.83 ROCKDALE, GA 1 *** 53 3219861 0248564 924 01/01/97 01/01/98 1 0.00 0.00 ROCKDALE, GA 1 *** 53 3219861 0248564 924 01/01/97 01/01/98 1 181.12 181.12 ROCKDALE, GA 1 *** 50 3318117 0435487 403 06/10/97 06/10/98 1 0.00 0.00 ROCKDALE, GA 1 *** 53 3266735 0351843 513 08/10/97 08/10/98 1 132.83 132.83
PAGE 23 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexB.XLS, EXPERIAN CONFIDENTIAL
Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE COUNTRY NAME QTY CUSTOMER NAME CUST CUST# CON.# EFFEC. ANNIV LEASE PRODUCT AMT,FL/GA TYPE DATE DATE #YRS PRICE C&I ONLY ROCKDALE, GA 1 *** 50 3012075 0341749 959 08/01/97 08/01/98 1 211.20 211.20 ROCKDALE, GA 1 *** 54 3265697 0271849 004 08/21/97 08/21/98 1 201.25 201.25 ROCKDALE, GA 1 *** 01 3331688 3161588 328 02/01/97 02/01/98 1 380.00 380.00 ROCKDALE, GA 1 *** 01 3513240 2017747 000 05/05/97 05/05/98 1 211.20 211.20 ROCKDALE, GA 1 *** 01 3768208 2008785 201 12/14/97 12/14/98 1 268.33 268.33 ROCKDALE, GA 8 *** 87 3308736 8271251 100 12/30/97 12/30/98 1 0.00 0.00 SARASOTA, FL 1 *** 87 3613103 0220309 100 03/03/97 03/03/98 1 0.00 0.00 SARASOTA, FL 1 *** 87 3090167 8258775 700 08/07/97 08/07/98 1 0.00 0.00 SARASOTA, FL 1 *** 99 0038841 0271278 100 12/05/97 12/05/98 1 0.00 0.00 SARASOTA, FL 1 *** 37 3014600 0207003 300 09/30/97 09/30/98 1 0.00 0.00 SARASOTA, FL 1 *** 37 2518608 0277531 901 07/01/97 07/01/98 1 498.33 498.33 SARASOTA, FL 1 *** 01 2904762 0187110 405 01/10/98 01/10/99 1 1650.00 1650.00 SARASOTA, FL 1 *** 01 2809562 0187630 304 02/25/97 02/25/98 1 260.10 260.10 SARASOTA, FL 1 *** 53 2309233 2151773 402 05/10/97 05/10/98 1 0.00 0.00 SARASOTA, FL 1 *** 01 2762195 2152231 402 03/10/97 03/10/98 1 1060.00 1060.00 SARASOTA, FL 2 *** 38 2309589 0179092 300 09/30/97 09/30/98 1 0.00 0.00 SARASOTA, FL 7 *** 87 3308736 8271278 100 12/30/97 12/30/98 1 0.00 0.00 SEMINOLE, FL 1 *** 01 2124016 2146276 402 03/01/97 03/01/98 1 760.00 760.00 SEMINOLE, FL 1 *** 01 3707753 0452612 207 03/20/97 03/20/98 1 855.00 855.00 SEMINOLE, FL 1 *** 01 3611447 2028502 101 07/30/97 07/30/98 1 0.00 0.00 SEMINOLE, FL 1 *** 01 2281193 0358762 603 08/10/97 08/10/98 1 760.00 760.00 SEMINOLE, FL 1 *** 54 3575860 0375272 502 05/03/97 05/03/98 1 760.00 760.00 SEMINOLE, FL 1 *** 01 2525859 0277344 801 11/17/96 11/17/97 1 0.00 0.00 SEMINOLE, FL 1 *** 14 2524650 2166169 400 06/10/97 06/10/98 1 442.50 442.50 SEMINOLE, FL 1 *** 01 2782298 0166395 403 10/10/97 10/10/98 1 875.00 875.00 SEMINOLE, FL 1 *** 12 2972778 0211710 201 11/10/97 11/10/98 1 389.40 389.40 SEMINOLE, FL 1 *** 01 2743297 0166487 401 09/10/97 09/10/98 1 389.40 389.40 SEMINOLE, FL 1 *** 87 3613103 0304031 800 05/24/97 05/24/98 1 0.00 0.00 SEMINOLE, FL 1 *** 87 3090167 0271322 100 12/28/97 12/28/98 1 0.00 0.00 SEMINOLE, FL 1 *** 99 0038841 8259978 100 08/27/97 08/27/98 1 0.00 0.00 SEMINOLE, FL 1 *** 54 2323260 0166367 401 06/10/97 06/10/98 1 760.00 760.00 SEMINOLE, FL 1 *** 43 3676334 0189886 403 03/01/97 03/01/98 1 376.25 376.25 SEMINOLE, FL 1 *** 37 2462851 0334223 701 03/10/97 03/10/98 1 760.00 760.00
PAGE 24 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. RESexB.XLS, EXPERIAN CONFIDENTIAL
Southeast C&I Report EXHIBIT B. Product Name=TRW REDI Comps (Commercial) - --------- Effective 01/01/96 to 11/07/97 TOT. SALE COUNTRY NAME QTY CUSTOMER NAME CUST CUST# CON.# EFFEC. ANNIV LEASE PRODUCT AMT,FL/GA TYPE DATE DATE #YRS PRICE C&I ONLY SEMINOLE, FL 1 *** 01 2337894 0166322 307 07/10/96 07/10/97 1 0.00 0.00 SEMINOLE, FL 1 *** 01 2222754 0297000 900 12/10/97 12/10/98 1 0.00 0.00 SEMINOLE, FL 1 *** 19 2300535 2166017 403 02/10/97 02/10/98 1 0.00 0.00 SEMINOLE, FL 1 *** 01 2723769 2166163 302 02/10/97 02/10/98 1 256.25 256.25 SEMINOLE, FL 1 *** 01 2002419 2166142 402 06/10/97 06/10/98 1 760.00 760.00 SEMINOLE, FL 1 *** 01 2011985 2166159 401 04/10/97 04/10/98 1 0.00 0.00 SEMINOLE, FL 1 *** 01 3807695 2107781 000 06/30/97 06/30/98 1 812.25 812.25 SEMINOLE, FL 1 *** 50 3342811 0208135 101 02/24/97 02/24/98 1 760.00 760.00 SEMINOLE, FL 1 *** 01 2778633 0166474 402 09/10/97 09/10/98 1 1210.00 1210.00 SEMINOLE, FL 1 *** 02 3388923 0278681 803 11/29/96 11/29/97 1 0.00 0.00 SEMINOLE, FL 1 *** 38 2233194 2152171 600 12/28/97 12/28/98 1 0.00 0.00 SEMINOLE, FL 1 *** 54 2236904 0462048 202 02/16/97 02/16/98 1 1089.00 1089.00 SEMINOLE, FL 1 *** 50 3627303 8433820 502 08/30/97 08/30/98 1 1210.00 1210.00 SEMINOLE, FL 2 *** 85 2915683 2014759 200 10/18/97 10/18/98 1 0.00 0.00 SEMINOLE, FL 7 *** 87 3308736 9259978 100 12/30/97 12/30/98 1 0.00 0.00 VOLUSIA, FL 1 *** 01 2124016 0172866 401 10/10/96 10/10/97 1 541.00 541.00 VOLUSIA, FL 1 *** 01 2281193 2125452 402 09/10/97 09/10/98 1 522.23 522.23 VOLUSIA, FL 1 *** 02 3158120 2166170 402 08/10/97 08/10/98 1 522.23 522.23 VOLUSIA, FL 1 *** 87 3613103 0320883 800 12/10/97 12/10/98 1 0.00 0.00 VOLUSIA, FL 1 *** 87 3090167 0258778 000 08/07/97 08/07/98 1 0.00 0.00 VOLUSIA, FL 1 *** 99 0038841 0271279 100 12/05/97 12/05/98 1 0.00 0.00 VOLUSIA, FL 1 *** 43 3676334 2156449 502 03/01/97 03/01/98 1 825.00 825.00 VOLUSIA, FL 1 *** 37 3014600 0127775 400 06/15/97 06/15/98 1 0.00 0.00 VOLUSIA, FL 1 *** 37 2462851 0334224 701 03/10/97 03/10/98 1 910.00 910.00 VOLUSIA, FL 1 *** 01 3040304 0208283 101 04/10/96 04/10/97 1 0.00 0.00 VOLUSIA, FL 1 *** 01 3690996 2018481 101 03/01/97 03/01/98 1 720.38 720.38 VOLUSIA, FL 1 *** 01 3512676 2156317 501 01/10/98 01/10/99 1 990.00 990.00 VOLUSIA, FL 2 *** 85 2915683 2014758 200 10/13/97 10/13/98 1 0.00 0.00 VOLUSIA, FL 7 *** 87 3308736 8271279 100 12/30/97 12/30/98 1 0.00 0.00 Total All Above 293,803.83 298,427.83
PAGE 25 *** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. EXHIBIT C - ----------- REGULAR PRODUCTS OF EXPERIAN RES'S ---------------------------------- FLORIDA AND GEORGIA C&I DATA EXTRACT BUSINESS --------------------------------------------- All are in printed media only. Monthly publication: Florida: Brevard, Broward, Dade, Duval, Hillsborough, Orange, Palm Beach, Pinellas, Sarasota, Seminole and Volusia counties. Georgia: Cherokee, Coweta, Douglas, Fayette, Forsyth, Hall, Henry and Rock- dale counties. Weekly publication: Georgia: City of Atlanta, and Clayton, Cobb, Dekalb, Fulton and Gwinnett counties. EXHIBIT D - COMPS MARKETS ------------------------- 1 AZ Maricopa 37 FL Orange 2 AZ Pima 38 FL Osceola 3 CA Alameda 39 FL Seminole 4 CA Contra Costa 40 GA Forsyth 5 CA El Dorado 41 GA Fulton 6 CA Fresno 42 GA Gwinnett 7 CA Los Angeles 43 IL Cook 8 CA Madera 44 IL DuPage 9 CA Marin 45 IL Lake 10 CA Merced 46 MA Essex 11 CA Napa 47 MA Middlesex 12 CA Orange 48 MA Norfolk 13 CA Placer 49 MA Suffolk 14 CA Riverside 50 MD Montgomery 15 CA Sacramento 51 MD Prince George's 16 CA San Bernardino 52 MD Washington, D.C. 17 CA San Diego 53 MD Anne Arundel 18 CA San Francisco 54 MD Baltimore 19 CA San Joaquin 55 MD City of Baltimore 20 CA San Mateo 56 MD Harford 21 CA Santa Clara 57 MD Howard 22 CA Solano 58 NV Clark 23 CA Sonoma 59 NY Manhattan 24 CA Stanislau 60 TX Collin 25 CA Ventura 61 TX Dallas 26 CA Yolo 62 TX Denton 27 CO Adams 63 TX Tarrant 28 CO Arapahoe 64 VA Fairfax 29 CO Boulder 65 VA Loudoun 30 CO Denver 66 VA Prince William 31 CO Douglas 67 VA Arlington 32 CO El Paso 68 VA City of Alexandria 33 CO Jefferson 69 WA King 34 GA Clayton 70 WA Pierce 35 GA Cobb 71 WA Snohomish 36 GA DeKalb
EXHIBIT E - NON-DISCLOSURE STATES --------------------------------- 1 Alabama 8 Montana 2 Alaska 9 Michigan 3 Idaho 10 New Mexico 4 Indiana 11 North Dakota 5 Kansas 12 Texas 6 Missouri 13 Utah 7 Mississippi 14 Wyoming
EXHIBIT F - ----------- PUBLICATION AND PRODUCTION COST INFORMATION ------------------------------------------- Estimated for January 1997: Direct labor (including research and preparation), printing and packaging: $11,600 for all Florida and Georgia regular products, or $6,000 for all Florida only Reproduction-ready masters only (if COMPS elects to print, package and fulfill itself, with such services from Experian RES): $3,575 for Florida only, $3,575 for Georgia only EX-10.44 47 ASSET PURCHASE AGMT DATED 11/6/98 Exhibit 10.44 ACQUISITION OF ASSETS OF REALBID LLC, a California Limited Liability Company by COMPS INFOSYSTEMS, INC., a Delaware Corporation November 6, 1998 *** Certain confidential portions of this Exhibit were omitted by means of blackout of the text (the "Mark"). This Exhibit has been filed separately with the Secretary of the Commission without the Mark pursuant to the Company's Application Requesting Confidential Treatment under Rule 406 under the Act. TABLE OF CONTENTS
PAGE ARTICLE 1 DEFINITIONS 1 1.1 Certain Definitions................................................ 1 ARTICLE 2 PURCHASE AND SALE OF PURCHASED ASSETS 3 2.1 Purchase and Sale of REALBID Assets................................ 3 2.2 Assumed Liabilities................................................ 5 2.3 Excluded Assets.................................................... 5 2.4 Purchase Price..................................................... 5 2.5 Closing Date....................................................... 5 2.6 Allocation of Aggregate Purchase Price............................. 5 2.7 Bulk Sales......................................................... 6 2.8 Sales and Use Taxes................................................ 6 2.9 Title.............................................................. 6 ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF REALBID 6 3.1 Ownership of REALBID Interests..................................... 6 3.2 Organization and Good Standing..................................... 6 3.3 Authorization...................................................... 7 3.4 Equity Securities of REALBID....................................... 7 3.5 No Conflict or Violation........................................... 7 3.6 Consents and Approvals............................................. 7 3.7 Books and Records.................................................. 7 3.8 Financial Statements............................................... 7 3.9 Accounts Receivable................................................ 8 3.10 Absence of Certain Changes or Events............................... 8 3.11 Contracts and Commitments.......................................... 10 3.12 Insurance.......................................................... 10 3.13 Litigation......................................................... 10 3.14 Liabilities........................................................ 11 3.15 Compliance with Law................................................ 11 3.16 No Brokers......................................................... 11 3.17 No Other Agreements to Sell REALBID................................ 11 3.18 Tax Matters........................................................ 11 3.19 Employment Matters and Benefit Plans............................... 12 3.20 Transaction with Certain Persons................................... 13 3.21 Environmental Quality.............................................. 13 3.22 Certain Advances................................................... 14 3.23 Licenses and Permits............................................... 14 3.24 Proprietary Rights................................................. 14 3.25 Material Misstatements or Omissions................................ 16 3.26 Exclusive Dealing.................................................. 16
TABLE OF CONTENTS (CONTINUED)
PAGE ---- 3.27 Real Property...................................................... 17 3.28 Location of Purchased Assets....................................... 17 3.29 Prepaid Expenses................................................... 17 3.30 Certain Agreements................................................. 17 3.31 Year 2000 Compliance............................................... 17 3.32 Necessary Property................................................. 18 3.33 Bank Accounts...................................................... 18 3.34 Valuation of COMPS................................................. 18 3.35 Full Disclosure.................................................... 18 ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF COMPS 18 4.1 Organization of COMPS.............................................. 18 4.2 Capitalization of COMPS............................................ 19 4.3 Authorization...................................................... 19 4.4 No Conflict or Violation........................................... 19 4.5 Consents and Approvals............................................. 20 4.6 No Brokers......................................................... 20 4.7 Litigation......................................................... 20 4.8 Liabilities........................................................ 20 4.9 Compliance with Law................................................ 20 4.10 COMPS Financial Statements......................................... 20 4.11 Absence of Certain Changes or Events for COMPS..................... 20 4.12 Full Disclosure.................................................... 21 ARTICLE 5 [INTENTIONALLY LEFT BLANK] 21 ARTICLE 6 CONDITIONS TO REALBID AND REALBID PRINCIPALS OBLIGATIONS 21 6.1 Representations, Warranties and Covenants.......................... 21 6.2 No Litigation or Governmental Proceedings.......................... 21 6.3 Delivery at the Closing............................................ 21 6.4 Material Adverse Change............................................ 22 ARTICLE 7 CONDITIONS TO COMPS' OBLIGATIONS 22 7.1 Representations, Warranties and Covenants.......................... 22 7.2 No Governmental Proceedings or Litigation.......................... 22 7.3 Third Party Consents............................................... 22 7.4 Delivery at Closing................................................ 22 7.5 Material Adverse Change............................................ 23 ARTICLE 8 ACTIONS BY COMPS AND THE REALBID PRINCIPALS AFTER THE CLOSING 23 8.1 Survival of Representations........................................ 23 8.2 Indemnification.................................................... 24 ARTICLE 9 MISCELLANEOUS 25 9.1 [Intentionally Left Blank]......................................... 25 9.2 Notices............................................................ 25
ii TABLE OF CONTENTS (CONTINUED)
PAGE ---- 9.3 Choice of Law...................................................... 27 9.4 Entire Agreement; Amendments and Waivers........................... 27 9.5 Counterparts....................................................... 27 9.6 Expenses........................................................... 27 9.7 Invalidity......................................................... 27 9.8 Confidentiality.................................................... 27 9.9 Arbitration and Venue.............................................. 28 9.10 Announcements...................................................... 28 9.11 Construction....................................................... 28 9.12 Schedules and Exhibits not Attached................................ 29 9.13 Severability....................................................... 29 9.14 Assignment......................................................... 29
iii ASSET PURCHASE AGREEMENT THIS ASSET AGREEMENT (this "Agreement") is made and entered into as of November 6, 1998 (the "Closing Date"), by and among COMPS INFOSYSTEMS, INC., a Delaware corporation ("COMPS"), REALBID LLC, a California limited liability company ("REALBID"), Emmett DeMoss, an individual ("DeMoss"), and Robert Potter, an individual ("Potter," and together with DeMoss, the "REALBID Principals"). RECITALS -------- WHEREAS, REALBID desires to sell to COMPS, and the REALBID Principals desire to cause REALBID to sell to COMPS, and COMPS desires to purchase from REALBID, substantially all of the assets, properties and rights of REALBID; and WHEREAS, REALBID, the REALBID Principals and COMPS desire to make certain representations, warranties, covenants and agreements in connection with such purchase and sale. NOW, THEREFORE, in consideration of the respective undertakings stated herein, COMPS, REALBID and the REALBID Principals agree as follows: ARTICLE 1 DEFINITIONS ----------- 1.1 Certain Definitions. The terms in this Section 1.1, for all purposes ------------------- ----------- of this Agreement, have the meaning herein specified: (a) "Actions" shall have the meaning as defined in Section 3.13. ------------ (b) "Agreement" shall have the meaning as defined in the introduction. (c) "Balance Sheets" shall have the meaning as defined in Section ------- 3.8.(a). - ------- (d) "Business" means the business and operations of REALBID as conducted immediately prior to Closing. (e) "COMPS" shall have the meaning as defined in the introduction. (f) "COMPS" Disclosure Schedule shall have the meaning as defined in Section 4. (g) "COMPS Group" shall have the meaning as defined in Section ------- 8.2(a). - ------ (h) Confidential Information" shall have the meaning as defined in Section 9.8(c). - -------------- (i) "Damages" shall have the meaning as defined in Section 8.2(e). -------------- (j) "Disclosure Schedule" shall have the meaning as defined in Section 3. - --------- (k) "Employment Agreement" shall have the meaning as defined in Section 6.3(b). - -------------- (l) "Encumbrance" means any mortgage, pledge, assessment, security interest, deed of trust, lease, lien, adverse claim, levy, charge or other encumbrance of any kind, or any conditional sale or title retention agreement or other agreement to give any of the foregoing in the future, except for Permitted Encumbrances. (m) "Financial Statements" shall have the meaning as defined in Section 3.8. - ----------- (n) "GAAP" shall have the meaning as defined in Section 3.8. ------------ (o) "General Assignment" shall have the meaning as defined in Section 6.3(d). (p) "Hazardous Material" shall have the meaning as defined in Section ------- 3.21(a). - ------- (q) "Income Statements" shall have the meaning as defined in Section ------- 3.8(b). - ------ (r) "Industry Initiative" shall have the meaning as defined in Section 3.26. - ------------ (s) "Intellectual Property" shall have the meaning as defined in Section 3.24(a). - --------------- (t) "Knowledge of COMPS" shall mean the knowledge of any executive officer of COMPS, in each case after due inquiry and reasonable investigation. (u) "Knowledge of REALBID" shall mean the knowledge of any officer, director or manager of REALBID, in each case after due inquiry and reasonable investigation. (v) "Knowledge of the REALBID Principals" shall mean the knowledge of any REALBID Principal in each case after due inquiry and reasonable investigation. (w) "LLC" shall have the meaning as defined in Section 3.2. ------------ (x) "LOI" shall have the meaning as defined in Section 6.4. ------------ (y) "Material Adverse Effect" means for any person or entity, a material adverse effect whether individually or in the aggregate (i) on the business, operations, financial condition, assets and properties, liabilities or prospects of such person or entity, or (ii) on the ability of such person or entity to consummate the transactions contemplated hereby. (z) "Non-Competition Agreement" shall have the meaning as defined in Section 7.4(a). (aa) "Other Contracts" shall have the meaning as defined in Section ------- 3.11. - ---- 2 (bb) "Permitted Encumbrances" shall mean (a) liens, charges, encumbrances and security interests (i) for taxes not yet due and payable or being contested in good faith by appropriate proceedings or for which adequate reserves have been established on the Financial Statements of REALBID or (ii) arising in the ordinary course of business in connection with the equipment leases listed as items 3 and 4 of Section 3.11 of the Disclosure Schedule, ------------ provided that such liens, charges, encumbrances and security interests do not arise in connection with any default or breach of such equipment leases by REALBID (including without limitation any failure by REALBID to pay fees due under such leases in a timely manner); (b) with respect to real property, easements, covenants, conditions and restrictions as to which no violation or encroachment exists which could in the aggregate have a Material Adverse Effect or which in the aggregate do not interfere or detract, in any material respect, from the use or value of such real property; and (c) mechanics', materialmans', suppliers', vendors' or similar security interests arising by operation of law and in the ordinary course of business securing amounts which are not delinquent. (cc) "Plan" shall have the meaning as defined in Section 3.19(c). --------------- (dd) "properly perform the Year 2000 Processing" shall have the meaning as defined in Section 3.31. ------------ (ee) "REALBID" shall have the meaning as defined in the introduction. (ff) "REALBID Intellectual Property" shall have the meaning as defined in Section 3.24(b). --------------- (gg) "REALBID Members' Shares" shall have the meaning as defined in Section 3.1. - ----------- (hh) "REALBID Principals" shall have the meaning as defined in the introduction. (ii) "Taxes" shall have the meaning as defined in Section 3.18(d). --------------- (jj) "Transaction" means the sale by REALBID of substantially all of the assets, properties and rights of REALBID to COMPS, including the Employment Agreements, the Non-Competition Agreements and the transactions contemplated thereby. (kk) "Year 2000 Processing" shall have the meaning as defined in Section 3.31. - ------------ ARTICLE 2 PURCHASE AND SALE OF PURCHASED ASSETS ------------------------------------- 2.1 Purchase and Sale of REALBID Assets. Subject to the terms and ----------------------------------- conditions of this Agreement, at the Closing, REALBID agrees to grant, sell, convey, assign, transfer and deliver to COMPS, and COMPS agrees to purchase and acquire from REALBID, free and clear of any Encumbrance or adverse claim of any kind whatsoever, except Permitted Encumbrances, all of REALBID's right, title, and interest in and to all assets, properties, rights, leases, fixtures, accessions, claims, contracts and interests of REALBID of every kind, type or description, real, 3 personal and mixed, tangible and intangible, wherever located and whether or not specifically referred to in this Agreement, that are used in or pertain to the Business (collectively, the "Purchased Assets"), including without limitation: (a) the machinery, equipment, leasehold improvements, furniture and fixtures, vehicles and other operating assets owned or leased by REALBID and used in the Business as set forth in Schedule 2.1(a) attached hereto; --------------- (b) the miscellaneous supplies of REALBID used in connection with the Business; (c) all of REALBID's right, title and interest in and to license agreements, supply agreements, sales and purchase agreements, real property leases, orders and the other contracts and agreements, written or oral, necessary for REALBID to operate the Business as set forth in Schedule 2.1(c) --------------- attached hereto (and to the extent oral, accurately described in Schedule 3.11 ------------- of the Disclosure Schedule the terms of such contract) (the "REALBID Assumed Contracts"); (d) to the extent assignable, all licenses, permits, consents, approvals, orders, certificates, authorizations, declarations and filings held by REALBID necessary or incidental to the conduct of the Business set forth in Schedule 2.1(d) attached hereto (the "REALBID Permits"); - --------------- (e) all of REALBID's customer lists, mailing lists, telephone numbers, correspondence, credit, sales and other records, business and accounting records, computer printouts, vendor lists, and sales and other literature, operating data, and books, files, documents and records relating to the Business (collectively, the "Books and Records"); provided, that REALBID will retain certain Books and Records necessary for REALBID to wind up its involvement in the Business and provide COMPS, at the sole cost and expense of COMPS, with access to such Books and Records upon reasonable prior request and during normal business hours as necessary to conduct the Business after the Closing Date (as defined below); (f) all right, title and interest in and to all of the REALBID Intellectual Property (as defined below), including without limitation (i) all of REALBID's rights to the name "REALBID" and variations thereof and all trademarks, tradenames, service marks and goodwill associated therewith; (ii) the domain name on the World Wide Web known as "realbid.com" and any successor thereto; and (iii) all items set forth in Section 3.24 of the Disclosure ------------ Schedule (as defined below) and all improvements, modifications and other Intellectual Property (as defined below) derived therefrom; (g) all prepaid expenses, deposits and deferred items in effect as of the Closing Date and from which COMPS may derive future benefit; (h) all accounts, accounts receivable, notes and notes receivable (collectively the "REALBID Account Receivables") of REALBID's Business as of the Closing Date, including without limitation those which are not evidenced by instruments or invoices, whether or not they have been earned by performance or have been written off or reserved against as a 4 bad debt or doubtful account, together with all instruments and all documents of title representing any of the foregoing and all right, title, security and guaranties in favor of REALBID with respect to any of the foregoing, as identified in Schedule 2.1(h) attached hereto; --------------- (i) the real properties leased or owned by REALBID set forth on Schedule 2.1(i) attached hereto (the "Assumed Real Property"); (j) all cash and cash equivalents of REALBID as of the Closing Date; and (k) the goodwill and going concern value of REALBID's Business. 2.2 Assumed Liabilities. COMPS agrees to assume, satisfy and perform when ------------------- due only those liabilities arising from all of the liabilities and obligations of REALBID under the Purchased Assets which arise on or after the Closing Date (the "Assumed Liabilities"). Except for the Assumed Liabilities, COMPS is not required to, and shall not, assume, pay, perform, defend or discharge REALBID's liabilities or obligations of any and every kind whatsoever, direct, indirect, absolute, contingent, secured, unsecured, accrued or otherwise, whether known or unknown, including without limitation (i) any accrued payroll, accrued payroll taxes, accrued vacation, accrued sick pay and accrued workman's compensation incurred by REALBID in connection with the operation of the Business, (ii) the BAP Loan, the ERD Loan and the LLC Managers Accrued Fee (as such terms are described in the Financial Statements) and (iii) any and all payables, costs and expenses of REALBID incurred before the Closing Date including those payables, costs and expenses set forth in the Financial Statements. Further, COMPS shall not assume or agree to pay, perform or discharge, nor be responsible for, any obligation or liability of REALBID with respect to breach by REALBID of any contract or commitment or any action, suit or proceeding. 2.3 Excluded Assets. Notwithstanding Section 2.1 hereof, the Purchased --------------- ----------- Assets do not include the assets set forth on Schedule 2.3 attached hereto (the ------------ "REALBID Excluded Assets"). 2.4 Purchase Price. As consideration for the Purchased Assets, COMPS -------------- agrees to (i) assume the Assumed Liabilities and (ii) pay, or cause to be paid, to REALBID an aggregate purchase price in cash of One Hundred Sixty-Three Thousand Dollars ($163,000) (the "Purchase Price. The Purchase Price shall be delivered to REALBID at the Closing by wire transfer in immediately available funds to an account designated by REALBID; and 2.5 Closing Date. The closing of the Transaction (the "Closing") shall be ------------ held at 10:00 A.M. local time on October 23, 1998 at the offices of COMPS, 9888 Carroll Centre Road, Suite 100, San Diego, California, or at such other time and place as the parties shall mutually agree (the "Closing Date"). 2.6 Allocation of Aggregate Purchase Price. As promptly as practicable -------------------------------------- following the Closing Date, but in no event later than 30 days thereafter (the "30-Day Period"), COMPS shall prepare and deliver to the REALBID Principals an allocation schedule which sets forth the allocation of the Purchase Price plus other relevant items for the transactions contemplated under this Agreement, which allocation schedule shall be in compliance with Section 1060 of the 5 Internal Revenue Code and Regulations. During the 30-Day Period, COMPS shall consult with the REALBID Principals in preparing such allocation schedule and each of COMPS and the REALBID Principals shall use their best efforts to agree upon a mutually acceptable allocation schedule. COMPS, REALBID and the REALBID Principals, as applicable, will file all returns, reports, information returns schedule or other documents (including any related or supporting information) filed or required to be filed with respect to any taxing authority in a manner consistent with such allocation. 2.7 Bulk Sales. COMPS hereby waives compliance by REALBID with the ---------- provisions of the applicable Bulk Sales Law of any state. REALBID and the REALBID Principals, jointly and severally, warrant and agree to pay and discharge when due all claims of creditors which could be asserted against COMPS by reason of such noncompliance. REALBID and the REALBID Principals shall, jointly and severally, indemnify and hold COMPS harmless from, against and in respect of any Damages (as defined in Article 8 below) suffered or incurred by COMPS by reason of the failure of REALBID to pay or discharge such claims. 2.8 Sales and Use Taxes. REALBID and the REALBID Principals shall be ------------------- responsible for all sales and use taxes, if any, arising out of the sale of the Purchased Assets to COMPS pursuant to this Agreement. 2.9 Title. Title to the Purchased Assets shall pass to COMPS at the ----- Closing and the Purchased Assets shall be at the risk of REALBID prior to the Closing. ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF REALBID ----------------------------------------- Each of REALBID and the REALBID Principals, jointly and severally, represents and warrants to COMPS as on the date hereof, except as set forth on the disclosure schedule furnished to COMPS (the "Disclosure Schedule"), specifically identifying the relevant section hereof, which exceptions shall be deemed to be representations and warranties as if made in this Article 3 --------- (provided that the disclosure in such exceptions shall be true, complete and correct), as follows: 3.1 Ownership of REALBID Interests. The REALBID Principals own ------------------------------ beneficially and of record all of the issued and outstanding interests/stock of REALBID (the "REALBID Members' Shares"), consisting of the number of REALBID Members' Shares listed opposite such REALBID Principal's name in Section 3.1 of ----------- the Disclosure Schedule, free and clear of all Encumbrances, and have, and on the Closing Date will have, good and valid title to such REALBID Members' Shares. 3.2 Organization and Good Standing. REALBID is a limited liability ------------------------------ company ("LLC"), validly existing and in good standing under the laws of the State of California, and has all requisite LLC power and LLC authority to conduct the business in which it is now engaged and to own, lease, license and use the assets and properties now owned, leased, licensed or used by it. REALBID is duly qualified to do business as a foreign LLC and is in good standing in each jurisdiction in which such qualification is necessary under the applicable law as a result of the conduct of its business or the ownership of it properties and where the failure to be so 6 qualified, singly or in the aggregate, would have a Material Adverse Effect on the Business, financial condition of REALBID or the Purchased Assets. Each jurisdiction, if any, in which REALBID is qualified to do business as a foreign LLC is listed on Section 3.2 of the Disclosure Schedule, except where failure to ----------- be qualified would not have a Material Adverse Effect on the Business or the Purchased Assets. Section 3.2 of the Disclosure Schedule also contains a correct ----------- and complete copy of REALBID's Operating Agreement as amended to date, that was previously delivered to COMPS. 3.3 Authorization. REALBID and the REALBID Principals have all the ------------- necessary power and authority and have taken all action necessary to enter into this Agreement, to consummate the Transaction contemplated hereby and to perform their respective obligations hereunder. This Agreement has been duly executed and delivered by REALBID and the REALBID Principals and is a legal, valid and binding obligation enforceable against REALBID and the REALBID Principals in accordance with the terms herein, except as such enforceability may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other similar laws, or by equitable principles, relating to or limiting the rights of creditors generally and (b) limitations imposed by law or equitable principles upon the availability of specific performance, injunctive relief or other equitable remedies. 3.4 Equity Securities of REALBID. The authorized equity securities of ---------------------------- REALBID consists solely of Eight Thousand (8,000) REALBID Members' Shares, of which Eight Thousand (8,000) shares are issued and outstanding as of the date hereof. All such issued and outstanding REALBID Members' Shares have been issued to the REALBID Principals. The REALBID Members' Shares are duly authorized, validly issued, fully paid and nonassessable, and issued in accordance with all federal and state securities laws. 3.5 No Conflict or Violation. Except as described in Section 3.5 of the ------------------------ ----------- Disclosure Schedule, neither the execution and delivery of this Agreement by REALBID or the REALBID Principals nor the consummation of the transactions contemplated hereby will result in (a) a violation of or a conflict with any of REALBID's charter documents; (b) a breach of, or a default under, or constitute a basis for terminating any term or provision of any REALBID Assumed Contract; (c) a conflict with or result in a violation or breach of any law, order, judgment, license, statute or regulation applicable to REALBID or the Purchased Assets; or (d) an imposition of any Encumbrance, restriction or charge on REALBID or the Purchased Assets. 3.6 Consents and Approvals. Except as set forth in Section 3.6 of the ---------------------- ----------- Disclosure Schedule, no consent, approval or authorization of, or declaration, filing or registration with, any governmental or regulatory authority, or any other person or entity, is required to be had or obtained by REALBID or the REALBID Principals in connection with the execution, delivery and performance of this Agreement and the consummation of the Transaction contemplated hereby. 3.7 Books and Records. The Books and Records as made available by REALBID ----------------- to COMPS are true, correct and complete. 3.8 Financial Statements. REALBID has delivered to COMPS the Balance -------------------- Sheets (as defined below) and the related Income Statements (as defined below) for REALBID 7 (collectively, the "Financial Statements"). The Financial Statements (i) are in accordance with the Books and Records of REALBID, (ii) have been prepared with the use of the software Quicken throughout the period covered thereby, (iii) to the Knowledge of REALBID and the REALBID Principals, have been prepared in a manner that is not materially different from generally accepted accounting principles ("GAAP"), (iii) fairly, accurately and completely present the assets, liabilities, Members' interests and financial position and the results of operations of REALBID for the periods covered thereby and (iv) are true, correct and complete. Section 3.8 of the Disclosure Schedule contains complete copies of ----------- the following Financial Statements including: (a) REALBID's balance sheet for the year ended December 31, 1997 and unaudited interim balance sheet for the period ended October 31, 1998 (collectively, the "Balance Sheets"). (b) REALBID's income statement for the year ended December 31, 1997; and unaudited interim income statement for the period ended October 31, 1998 (collectively the "Income Statements"). 3.9 Accounts Receivable. All of the REALBID Accounts Receivable shown on ------------------- the Financial Statements or thereafter acquired arose in the usual and ordinary course of business consistent with past practices, and the values at which such REALBID Accounts Receivable are carried on the Books and Records of REALBID reflect the accounts receivable valuation policy of REALBID which is consistent with REALBID's past practice and, to the Knowledge of REALBID and the REALBID Principals, is prepared in a manner that is not materially different from GAAP. Such REALBID Accounts Receivables are bona fide receivables and are collectible, legal, valid and binding obligations of the obligors, and to the Knowledge of REALBID and the REALBID Principals, should be able to be collected by REALBID without counterclaim or setoff. 3.10 Absence of Certain Changes or Events. Except as specifically set ------------------------------------ forth on Section 3.10 of the Disclosure Schedule, since September 30, 1998 and ------------ up to the Closing Date, REALBID and the REALBID Principals have conducted business only in the ordinary and usual course and, there has not been any material adverse change in, or any event or development which, individually or together with other such events, could reasonably be expected to result in a Material Adverse Effect on REALBID or the Purchased Assets including, without limiting the generality of the foregoing, the events as described below. (a) change in REALBID's condition (financial or otherwise), the Purchased Assets, liabilities, working capital, reserves, earnings, business or prospects, except for changes which have not, individually or in the aggregate, been materially adverse, and, to the Knowledge of REALBID or the REALBID Principals, any developments in the Business which could reasonably be expected to have a Material Adverse Effect on the condition (financial or otherwise), earnings, business or prospects the Business or the Purchased Assets; (b) failure to operate the Business in the ordinary course so as to use REALBID and the REALBID Principals' respective efforts to preserve the Business and the 8 Purchased Assets intact and to preserve the goodwill of REALBID's suppliers, customers and others having business relations with REALBID; (c) sale, assignment for transfer of any of the Purchased Assets, including the REALBID Intellectual Property, other than in the ordinary course of business, consistent with past practices; (d) additional indebtedness for borrowed money over Five Thousand Dollars ($5,000) in the aggregate, without the express written consent of COMPS; (e) hiring of individuals earning an annual compensation, including salary, cash bonuses and commissions, in excess of Thirty Thousand Dollars ($30,000), without the express written consent of COMPS; (f) material change in the terms or termination of any REALBID Assumed Contract; (g) amendments or changes to the charter documents of REALBID; (h) individual capital expenditure or commitment, or series of related capital expenditure or commitments, by REALBID or any of the REALBID Principals outside of the ordinary course of business exceeding Five Thousand Dollars ($5,000); (i) destruction of, damage to or loss of any Purchased Assets or other assets or properties material to the Business (whether or not covered by insurance); (j) material adverse change in a material customer relationship including without limitation any cancellation or termination or notice of termination or cancellation by any material customer of its relationship or a material portion of its relationship with REALBID; (k) labor trouble or claim of wrongful discharge or other unlawful labor practice or action that would have a Material Adverse Effect on the Business; (l) material change in accounting methods or practices (including any change in depreciation or amortization policies or rates) by REALBID; (m) declaration, setting aside or payment of a dividend or other distribution with respect to the capital stock of REALBID, or any direct or indirect redemption, purchase or other acquisition by REALBID of any of its capital stock; (n) increase in the salary or other compensation payable or to become payable to any of its (i) officers, managers or directors or (ii) employees or advisors, or the declaration, payment or commitment or obligation of any kind for the payment of a bonus or other additional salary or compensation to any such person except for increases, payments or commitments in the ordinary course of business consistent with past practices; 9 (o) waiver or release of any material right or claim of REALBID, including any write-off or other compromise of any REALBID Account Receivable other than in the ordinary course of business consistent with past practices; (p) any Encumbrances or other restriction on any of the Purchased Assets; (q) delayed or postponed the payment of accounts payable or other liabilities outside of the ordinary course of business; or (r) any other event or condition which in any one case or in the aggregate has or might reasonably be expected to have a Material Adverse Effect on the Purchased Assets or the condition (financial or otherwise), earnings or prospectus of the Business. 3.11 Contracts and Commitments. Section 3.11 of the Disclosure Schedule ------------------------- ------------ constitutes a correct and complete list of (i) all of the REALBID Assumed Contracts and (ii) all other written and oral material contracts and material commitments to which REALBID is a party or by which the Purchased Assets are bound in any material respect (and, to the extent oral, accurately described the terms of such contracts or commitments) (the "Other Contracts"). (a) The REALBID Assumed Contracts and the Other Contracts are, in all material aspects, valid and legally binding obligations, enforceable in accordance with their terms (subject to applicable bankruptcy, insolvency and other laws effecting the enforceability of creditors rights generally). (b) REALBID is current in the performance of all material obligations required of it under any of the REALBID Assumed Contracts and the Other Contracts. (c) Except as stated on Section 3.11 of the Disclosure Schedule, to ------------ the Knowledge of REALBID and the REALBID Principals, no party with whom REALBID has entered into one of the REALBID Assumed Contracts or the Other Contracts is in material default in its performance thereunder or has materially breached any terms thereof. (d) All of the REALBID Assumed Contracts and the Other Contracts are available to the officers, employees and representatives of COMPS for their review and examination (and, to the extent oral, accurate written description of the terms of such contracts are available.) 3.12 Insurance. REALBID has no insurance policies of any nature and no --------- insurance policy of any nature is required by any federal, state, local or other governmental or regulatory authorities to operate the Business or to own the Purchased Assets nor is any insurance policy necessary or incidental to the conduct of the Business or the ownership of the Purchased Assets. 3.13 Litigation. There is no action, order, writ, injunction, judgment, ---------- decree, claim, suit, litigation, proceeding, labor dispute, arbitral action, investigation or similar dispute of any sort whatsoever (collectively, "Actions") outstanding or pending or, to the Knowledge of REALBID and the REALBID Principals, threatened or anticipated against, relating to or effecting REALBID, the Purchased Assets or the Transaction contemplated by this Agreement. REALBID and the REALBID Principals are not in default with respect to any judgment, order, 10 writ, injunction or decree of any court or governmental agency, and there are no unsatisfied judgments against REALBID, the Purchased Assets or the Business. 3.14 Liabilities. REALBID or the REALBID Principals have no liabilities or ----------- obligations (absolute, accrued, contingent or otherwise), which may have an adverse effect on the Business, the Purchased Assets, or this Transaction, except the liabilities which are reflected and reserved against on the Financial Statements or liabilities incurred in the ordinary course of business and consistent with past practice since the last period covered in the Financial Statements which have not had, and could not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Effect on REALBID or the Purchased Assets. 3.15 Compliance with Law. REALBID and the REALBID Principals are in ------------------- compliance with all applicable laws, statutes, ordinances and regulations in effect as of the Closing Date whether federal, state or local, except where the failure to comply would not have a Material Adverse Effect on the Business, the Purchased Assets, the Transaction or prospects of REALBID. Neither REALBID nor any of the REALBID Principals has received any written notice to the effect that, or otherwise been advised that, it is not in compliance with any of such statutes, regulations, orders, ordinances or other laws where the failure to comply would have a Material Adverse Effect on the Business, prospects of REALBID, the Purchased Assets or the transaction, and neither the REALBID Principals nor REALBID has any reason to anticipate that any presently existing circumstances are likely to result in violations of any such regulations which would, in any one case or in the aggregate, have a Material Adverse Effect on the Business, the Purchased Assets, the Transaction or prospects of REALBID. 3.16 No Brokers. Neither REALBID nor the REALBID Principals has paid, nor ---------- incurred any obligation to pay, any finder's fee, brokerage commission or similar payment of any sort whatsoever in connection with the Transaction contemplated by this Agreement. COMPS has not and will not have any obligation to pay any broker's, finder's, investment broker's, financial advisor's or similar fee in connection with this Agreement or the Transaction by reason of any action taken by or on behalf of REALBID. 3.17 No Other Agreements to Sell REALBID. Neither REALBID nor the REALBID ----------------------------------- Principals nor any affiliate or representative of REALBID has any obligation, absolute or contingent, to any other person or firm to sell or encumber REALBID, the Purchased Assets or to effect any sale, consolidation or other reorganization of REALBID or to enter into any agreement with respect thereto, nor has any such party had any discussion with any third party regarding any of the foregoing. 3.18 Tax Matters ----------- (a) REALBID is a limited liability company which is and at all times has prepared all federal and state income tax returns and reports as a partnership. No jurisdiction has at any time asserted or indicated that it may assert that REALBID should be treated as an association taxable as a corporation. REALBID has duly and timely filed all Tax reports and returns required to be filed by, including all federal, state, local and foreign tax returns and reports prior to the Closing. All such Tax returns were correct and complete in all material respects when filed. All Taxes of REALBID or for which REALBID could be held liable 11 (whether or not shown on any Tax return or report) have been paid in full. To the Knowledge of REALBID and the REALBID Principals, REALBID has made adequate provision in its financial statements in a manner not materially different from GAAP, for the payment of all Taxes which may subsequently become due. All Taxes which any Taxpayer has been required to collect or withhold at the time of the Closing have been duly collected or withheld and, to the extent required, have been or will be duly paid to the proper taxing authority. REALBID has not been a member of an affiliated group filing a consolidated federal income Tax return. The Company is not a party to any Tax allocation or sharing agreement. (b) No audit is currently pending with respect to any Tax return or report of REALBID, nor is any REALBID Principal aware of any information which has caused or should cause them to believe that an audit by any Tax authority may be forthcoming, and there are no claims which have been or may be asserted relating to any of REALBID's Tax returns filed for any year which if determined adversely would result in the assertion by any governmental agency of any deficiency in Tax. There are no liens for Taxes on the Purchased Assets and all Taxes due or payable, and all interest and penalties thereon, whether disputed or not, which could result in the imposition of any lien on the Purchased Assets or REALBID, have been paid in full. REALBID has not waived any statute of limitations in respect of Taxes or agreed to any extension of time for the assessment of any Tax. No claim has ever been made by an authority in a jurisdiction where REALBID does not file Tax returns or reports that it is or may be subject to taxation by that jurisdiction. (c) REALBID does not have any liability for the Taxes of any other Person (A) under Treasury Regulations (S) 1.1502-6 (or any similar provision of state, local, or foreign law), (B) as a transferee or successor, (C) by contract, or (D) otherwise. (d) For the purpose of this Agreement, "Tax" means and includes any federal, state, local or foreign income, sales, use, withholding, transfer, payroll, excise, personal property, occupancy or other tax, levy, impost, fee, imposition, assessment or charge imposed by or on behalf of any governmental entity or any agency or instrumentality thereof, together with any related addition to tax, interest or penalty thereon. 3.19 Employment Matters and Benefit Plans. ------------------------------------ (a) Except for the REALBID Principals, REALBID has no and never has had any employees. REALBID has complied in all material respects with all applicable laws relating to the employment of labor, including provisions thereof relating to wages, hours, equal opportunity, collective bargaining, age and sex discrimination and the withholding and payment of social security and other taxes. (b) None of the REALBID Principals is in violation of any term of any employment contract, patent disclosure agreement, non-competition agreement, or any restrictive covenant to a former employer relating to the right of any such REALBID Principal because of the nature of the business conducted or presently proposed to be conducted by REALBID or to the use of trade secrets or proprietary information of others. 12 (c) REALBID has no and never has had any benefit plan, arrangement or understanding of any kind ("Plan") nor is any REALBID Principal or his respective affiliate entitled to any rights under any REALBID Plan or other benefits or arrangements of REALBID of any kind, including but not limited to payments of deferred compensation. 3.20 Transaction with Certain Persons. Except as set forth on Schedule -------------------------------- -------- 3.20, no officer, director or employee of REALBID or any member of any such - ---- person's immediate family is presently a party to any transaction with REALBID relating to the Business or the Purchased Assets, including without limitation, any contract, agreement or other arrangement (i) providing for the furnishing of services by, (ii) providing for the rental of real or personal property from, or (iii) otherwise requiring payments to (other than for services as officers, directors or employees of REALBID) any such person or corporation, partnership, trust or other entity in which any such person has a substantial interest as a shareholder, officer, director, trustee or partner. 3.21 Environmental Quality. --------------------- (a) Hazardous Material. To the Knowledge of REALBID and the REALBID ------------------ Principals, no underground storage tanks are present under any property that is a part of the Purchased Assets. No material amount of any substance that has been designated by any governmental entity or by applicable federal, state or local law to be radioactive, hazardous or otherwise to pose an unreasonable danger to human health or the environment, including, without limitation, PCBs, friable asbestos, petroleum, urea-formaldehyde and all substances listed as hazardous substances pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended, or defined as a hazardous waste pursuant to the United States Resource Conservation and Recovery Act of 1976, as amended and in effect as of the Closing Date, and the regulations promulgated pursuant to said laws, (a "Hazardous Material"), but excluding office, maintenance, shipping and janitorial supplies, are present as a result of the actions of REALBID or, to the Knowledge of REALBID and the REALBID Principals, as a result of any actions of any third party or otherwise, in, on or under any property, including the land and the improvements, ground water and surface water thereof, that REALBID has at any time owned, operated, occupied or leased. Section 3.21 of the Disclosure Schedule lists all locations that ------------ REALBID formerly owned or leased where, to the Knowledge of REALBID and the REALBID Principals, Hazardous Materials are present in a volume or concentration that would reasonably be expected to have a Material Adverse Effect on the Business or the Purchased Assets. (b) Environmental Liabilities. No material action, proceeding, ------------------------- revocation proceeding, amendment procedure, writ, injunction or claim is pending, or to the Knowledge of REALBID and the REALBID Principals, threatened concerning any Hazardous Material in, on or under any property owned or leased REALBID. REALBID is not aware of any fact or circumstance that could involve REALBID in any environmental litigation that would reasonably be expected to have a Material Adverse Effect on the Business or the Purchased Assets or impose upon REALBID any material environmental liability. 13 3.22 Certain Advances. No receivable of REALBID is owing by a director, ---------------- officer, or employee, consultant or shareholder of REALBID or owing by any relative of any such person, other than for advances in the ordinary and usual course of business to an officer or employee for reimbursable business expenses. 3.23 Licenses and Permits. Schedule 2.1(d) is a true and complete list of -------------------- --------------- all of the REALBID Permits. All such REALBID Permits are currently effective and valid and have been validly issued. No additional permits or licenses are necessary to enable REALBID to conduct the Business in compliance with all applicable federal, state and local laws, except where failure to obtain such licenses or permits would not have a Material Adverse Effect on the Business or the Purchased Assets. Neither the execution, delivery or performance of this Agreement nor the mere passage of time (except as specifically noted in the Disclosure Schedule) will have any effect on the continued validity or sufficiency of the REALBID Permits. There are no actions or proceedings pending or, to the Knowledge of REALBID and the REALBID Principals, threatened which may result in the revocation, cancellation, suspension, or any adverse modification of any REALBID Permit. 3.24 Proprietary Rights. (a) "Intellectual Property" consists of the following: (i) all patents, trademarks, trade names, service marks, trade dress, copyrights and any renewal rights therefor, mask works, net lists, schematics, technology, inventions, manufacturing processes, supplier lists, trade secrets, know-how, moral rights, computer software programs or applications (in both source and object code form), applications and registrations for any of the foregoing; (ii) all software and firmware listings, and updated software source code, and complete system build software and instructions related to all software described herein; (iii) all documents, records and files relating to design, end user documentation, manufacturing, quality control, sales, marketing or customer support for all intellectual property described herein; (iv) all other tangible or intangible proprietary information and materials; and (v) all license and other rights in any third party product, intellectual property, proprietary or personal rights, documentation, or tangible or intangible property, including without limitation the types of intellectual property and tangible and intangible proprietary information described in sub-sections (i) through (iv) above. (b) "REALBID Intellectual Property" consists of all Intellectual Property described in sub-sections (a)(i)-(iv) in this Section 3.24 that are ---- owned or held by or on behalf of REALBID, and/or any REALBID Principal, or that are being, and/or have been, used, or are currently under development for use, in the business of REALBID as it has been, is currently anticipated or is reasonably anticipated (as of the date of this Agreement and as of the Closing 14 Date) by REALBID and/or the REALBID Principals to be, conducted. Each REALBID Principal shall specifically identify on Section 3.24 of the ------------ Disclosure Schedule any intellectual property as to which he asserts individual rights and identify any Intellectual Property which he will not assign or license to REALBID. (c) Section 3.24 of the Disclosure Schedule lists: (i) all patents, ------------ copyrights, mask works, trademarks, service marks, trade dress, any renewal rights for any of the foregoing, and any applications and registrations for any of the foregoing, which are included in the REALBID Intellectual Property and owned by or on behalf of REALBID; (ii) all material hardware products and tools, software products and tools, and services that are currently published, offered, or under development by REALBID; and (iii) all material licenses, sublicenses and other agreements to which REALBID is a party and pursuant to which REALBID or any other person is authorized to use the REALBID Intellectual Property or exercise any other right with regard thereto. (d) The REALBID Intellectual Property consists solely of items and rights which are either: (i) owned by REALBID, (ii) in the public domain or (iii) rightfully used and authorized for use by REALBID and its successors pursuant to a valid license. All REALBID Intellectual Property which consists of license or other rights to third party property is set forth in Section 3.24 of ------------ the Disclosure Schedule. REALBID has all rights in the REALBID Intellectual Property necessary to carry out REALBID's current and former activities, including without limitation rights to make, use, reproduce, modify, adapt, create derivative works based on, translate, distribute (directly and indirectly), transmit, display and perform publicly, license, rent, lease, assign, and sell the REALBID Intellectual Property and products embodying the REALBID Intellectual Property in all geographic locations and fields of use, and to sublicense any or all such rights to third parties, including the right to grant further sublicenses. (e) REALBID and each REALBID Principal is not, nor as a result of the execution or delivery of this Agreement, or performance of REALBID's obligations hereunder, will REALBID be, in violation of any license, sublicense or other agreement to which REALBID or any REALBID Principal is a party or otherwise bound. Except as specifically described in Section 3.24 of the Disclosure ------------ Schedule, neither REALBID nor any REALBID Principal is obligated to provide any consideration (whether financial or otherwise) to any third party, nor is any third party otherwise entitled to any consideration, with respect to any exercise of rights by REALBID or COMPS in the REALBID Intellectual Property. (f) To the Knowledge of REALBID and the REALBID Principals, the use, reproduction, modification, distribution, licensing, sublicensing, sale, or any other exercise of rights in any product, work, technology, service or process as used, provided or offered at any time, or as reasonably proposed by REALBID and/or the REALBID Principals for use, reproduction, modification, distribution, licensing, sublicensing, sale or any other exercise of rights, by REALBID does not infringe any copyright, patent, trade secret, trademark, service mark, trade name, firm name, logo, trade dress, mask work, moral right, other intellectual property right, right of privacy or right in personal data of any person. No claims (i) challenging the validity, effectiveness, or ownership by REALBID of any of the REALBID Intellectual Property, or (ii) to the effect that the use, reproduction, modification, manufacturing, distribution, licensing, sublicensing, sale or any other exercise of rights in any product, work, technology, 15 service or process as used, provided or offered at any time, or as currently proposed or reasonably proposed (as of the date of this Agreement and as of the Closing Date) by REALBID and/or the REALBID Principals for use, reproduction, modification, distribution, licensing, sublicensing, sale or any other exercise of rights, by REALBID infringes or will infringe on any intellectual property or other proprietary or personal right of any person have been asserted or, to the Knowledge of REALBID and each of the REALBID Principals, are threatened by any person nor are there any valid grounds for any bona fide claim of any such kind. All granted or issued patents and mask works and all registered trademarks listed on Section 3.24 of the Disclosure Schedule and all copyright ------------ registrations held by REALBID are valid, enforceable and subsisting. To the Knowledge of REALBID and the REALBID Principals, there is no unauthorized use, infringement or misappropriation of any of the REALBID Intellectual Property by any third party, employee or former employee. (g) No parties other than REALBID possess any current or contingent rights to any source code which is part of the REALBID Intellectual Property. (h) Section 3.24 of the Disclosure Schedule lists all parties other ------------ than employees who have created any portion of, or otherwise have any rights in or to, the REALBID Intellectual Property. REALBID has secured from all parties who have created any portion of, or otherwise have any rights in or to, the REALBID Intellectual Property valid and enforceable written assignments of any such work or other rights to REALBID and has provided true and complete copies of such assignments to COMPS. (i) Section 3.24 of the Disclosure Schedule includes a true and ------------ complete list of each support and maintenance agreement relating to REALBID Intellectual Property including without limitation the identity of the parties entitled to receive such service or maintenance, the term of such agreements and any other provisions relating to the termination of such agreements. 3.25 Material Misstatements or Omissions. No representations or warranties ----------------------------------- by REALBID and the REALBID Principals in this Agreement, nor any document, exhibit, statement, certificate or schedule furnished to COMPS pursuant hereto, or in connection with the transactions contemplated hereby, contain or will contain any untrue statement of a material fact, or omit or will omit to state any material fact necessary to make the statements or facts contained therein not misleading. REALBID and the REALBID Principals have disclosed all events, conditions and facts materially affecting the Business, condition (financial or otherwise) or prospects of such REALBID or the Purchased Assets. 3.26 Exclusive Dealing. REALBID and the REALBID Principals represent and ----------------- warrant that they are not entertaining any bids, inquiries or other offers toward a transaction with any other entity that would affect the ownership of REALBID, and that they will continue not to do and will not orally or in writing agree to any such transaction until this Agreement has been terminated. Any such offers or indications of interest received by REALBID will be promptly disclosed to COMPS. COMPS is aware that REALBID is involved in ongoing discussions with certain brokerage firms who are formulating an Industry Initiative ("Industry Initiative"), which discussions do not involve any purchase or sale of REALBID. This initiative may or may not involve REALBID. REALBID will update COMPS on any material developments regarding the 16 Industry Initiative. COMPS acknowledges and agrees that REALBID's participation in the Industry Initiative will not constitute a breach of this Section 3.26. ------------ 3.27 Real Property. ------------- (a) Schedule 2.1(i) contains a complete and accurate list and legal --------------- description of the Assumed Real Property. Except as provided in Section 3.27 of the Disclosure Schedule, REALBID has ------------ good and marketable title to, or a valid leasehold interest in, all of the Assumed Real Property, free and clear of all Encumbrances. Each lease with respect to the Assumed Real Property is a legal, valid and binding agreement of the party thereto, subsisting in full force and effect and enforceable in accordance with its terms, and, except as set forth in Section 3.27 of the ------------ Disclosure Schedule, there is no, and none of REALBID Principals or REALBID has received notice of any, default (or any condition or event which, after notice or lapse of time or both, would constitute a default) thereunder. REALBID does not owe any brokerage commissions with respect to any such Assumed Real Property. 3.28 Location of Purchased Assets. The Disclosure Schedule contains a ---------------------------- complete and accurate schedule specifying the location of all of the Purchased Assets, where applicable, as of the Closing Date. REALBID has good and marketable title to, or a valid leasehold interest in all of the Purchased Assets, free and clear of all Encumbrances. Except as set forth in the Disclosure Schedule, the Purchased Assets being transferred to COMPS pursuant to this Agreement include all the Intellectual Property necessary for the ownership and operation of the Business as currently conducted. 3.29 Prepaid Expenses. All prepaid expenses of REALBID that are reflected ---------------- on the Financial Statements, and all prepaid expenses incurred by REALBID since the last period covered in the Financial Statements and set forth in Section ------- 3.29 of the Disclosure Schedule, are bona fide prepaid expenses and represent - ---- amounts due with respect to actual, arms-length transactions entered into in the ordinary course of business of REALBID. 3.30 Certain Agreements. Except as disclosed in Section 3.30 of the ------------------ ------------ Disclosure Schedule or as contemplated by this Agreement, neither the execution and delivery of this Agreement, nor the consummation of the Transaction contemplated hereby will: (i) result in any payment by REALBID (including, without limitation, severance, unemployment compensation, parachute payment, bonus or otherwise) becoming due to any officer, director, employee or independent contractor of REALBID or any REALBID Principal under any Plan, agreement or otherwise, (ii) increase any benefits otherwise payable under any Plan or agreement, or (iii) result in the acceleration of the time of payment or vesting of any such benefits. 3.31 Year 2000 Compliance. For purposes of this Section: (i) "Year 2000 -------------------- Processing" means processing by the REALBID Intellectual Property that manage and/or manipulate data involving dates, including single century formulas and multi-century formulas and dates on or after January 1, 2000; and (ii) "properly perform the Year 2000 Processing" means that REALBID Intellectual Property will not cause an abnormally ending dating scenario within the application or result in incorrect values generated involving such dates. REALBID and the 17 REALBID Principals warrant that (x) any version of the REALBID Intellectual Property created and provided by REALBID shall properly perform Year 2000 Processing, and (y) to the Knowledge of REALBID and the REALBID Principals, all other versions of the REALBID Intellectual Property provided by REALBID shall properly perform Year 2000 Processing. 3.32 Necessary Property. The Purchased Assets constitute all of the assets ------------------ and properties necessary for the conduct of the Business in the manner and to the extent presently conducted by REALBID. 3.33 Bank Accounts. Section 3.33 of the Disclosure Schedule contains a ------------- ------------ complete and accurate list of each deposit account or asset maintained by or on behalf of REALBID with any bank, brokerage house or other financial institution, specifying the name and address of the institution, the name under which the account is maintained, the account number, and the name and title or capacity of each person or entity authorized to have access thereto. 3.34 Valuation of COMPS. REALBID and the REALBID Principals agree and ------------------ acknowledge that (i) neither COMPS nor any representative of COMPS has made any representation, whether written or oral, about, or taken any action or inaction representing, the fair market value of the capital stock of COMPS, the stock options of COMPS or any other valuation of COMPS and (ii) any valuation of the capital stock of COMPS, the stock options of COMPS or any other valuation of COMPS made by REALBID, the REALBID Principals or any representative of the REALBID or the REALBID Principals (collectively, the "REALBID Group") were made by REALBID Group based on their independent due diligence review of COMPS and not in reliance on any discussions with or materials from COMPS (except for the COMPS Financial Statements). 3.35 Full Disclosure. All information requested by COMPS and the --------------- opportunity to enter into discussions with officers, employees and consultants of REALBID, at or before the Closing Date have been made available to COMPS and such information, together with the schedules, exhibits and any other agreements and certificates executed and delivered by REALBID or any of the REALBID Principals pursuant to this Agreement, does not contain any untrue statement of material fact, or omits to state a material fact necessary to make the statements or facts contained herein or therein not misleading in light of the circumstances under which they were furnished. ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF COMPS --------------------------------------- COMPS represents and warrants to REALBID and the REALBID Principals as of the Closing Date, except as set forth on the disclosure schedule furnished to REALBID and the REALBID Principals (the "COMPS Disclosure Schedule"), specifically identifying the relevant section hereof, which exceptions shall be deemed to be representations and warranties as if made in this Article 4 --------- (provided that the disclosure in such exceptions shall be true, correct and complete), as follows: 4.1 Organization of COMPS. COMPS is a corporation duly organized, validly --------------------- existing and in good standing under the laws of the State of Delaware, has full corporate power 18 and authority to conduct its business in which it is now engaged and to own, lease, license and use the properties and assets now owned, licensed or used by it. COMPS is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which such qualification is necessary under the applicable law as a result of the conduct of its business or the ownership of its properties and where the failure to be so qualified, singly or in the aggregate, would have a Material Adverse Effect on COMPS. 4.2 Capitalization of COMPS. The authorized capital stock of COMPS ----------------------- consists of (i) Twenty-Two Million Five Hundred Thousand (22,500,000) shares of Class A Common Stock, par value $.01 per share, of which there were Four Million Seven Hundred Seventy-Three Thousand Eight Hundred Sixty (4,773,860) shares issued and outstanding as of October 28, 1998, (ii) Two Million Five Hundred Thousand (2,500,000) shares of Class B Common Stock, par value $.01 per share, of which there were Thirty-Three Thousand Five Hundred (33,500) shares issued and outstanding as of October 28, 1998, and (iii) Five Million (5,000,000) shares of Preferred Stock, par value $.01 per share, of which there were Four Million Nine Hundred Eight Thousand One Hundred Twenty-Six (4,908,126) shares issued or outstanding as of October 28, 1998. No shares of COMPS Class A or Class B Common Stock or Preferred Stock have been issued since October 28, 1998 except pursuant to the exercise of stock options or warrants listed on Section ------- 4.2 of the COMPS Disclosure Schedule. All outstanding shares of COMPS Common - --- Stock and Preferred Stock are duly authorized, validly issued, fully paid and non-assessable, and issued in accordance with all federal and state securities laws. An aggregate of Thirty-Seven Thousand Three Hundred Twenty-Nine (37,329) shares of COMPS Class A Common Stock and One Million Nine Hundred Forty-Seven Thousand Two Hundred Eighty-Four (1,947,294) shares of COMPS Class B Common Stock are issuable upon the exercise of COMPS options and warrants which were outstanding as of October 28, 1998. All shares of COMPS Common Stock subject to issuance as aforesaid, upon issuance on the terms and conditions specified in the instruments pursuant to which they are issuable, would be duly authorized, validly issued, fully paid and nonassessable. 4.3 Authorization. COMPS has all the necessary corporate power and ------------- authority and has taken all corporate action necessary to enter into this Agreement, to consummate the Transaction contemplated hereby and to perform its obligations hereunder. This Agreement has been duly executed and delivered by COMPS and is a legal, valid and binding obligation enforceable against COMPS in accordance with the terms except as such enforceability may be limited by (a) bankruptcy, insolvency, reorganization, moratorium or other similar laws, or by equitable principles, relating to or limiting the rights of creditors generally and (b) limitations imposed by law or equitable principles upon the availability of specific performance, injunctive relief or other equitable remedies. 4.4 No Conflict or Violation. Except as described in Section 4.4, of the ------------------------ ----------- COMPS Disclosure Schedule, neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby will result in (a) a violation of or a conflict with any of COMPS' charter documents; (b) a breach of, or a default under, or constitute a basis for terminating any term or provision of any contract, agreement, indebtedness, lease to which COMPS is a party (c) a violation by COMPS of any law, order or judgment; or (d) an imposition of any encumbrance, restriction or charge on COMPS. 19 4.5 Consents and Approvals. Except as set forth in Section 4.5 of the ---------------------- ----------- COMPS Disclosure Schedule, no consent, approval or authorization of, or declaration, filing or registration with, any governmental or regulatory authority, or any other person or entity, is required to be had or obtained by COMPS in connection with the execution, delivery and performance of this Agreement and the consummation of the Transaction contemplated hereby. 4.6 No Brokers. COMPS has not paid nor incurred any obligation to pay, any ---------- finder's fee, brokerage commission or similar payment of any sort whatsoever in connection with the Transaction contemplated by this Agreement. REALBID has no and will have no obligation to pay any broker's, finder's, investment broker's, financial advisor's or similar fee in connection with this Agreement or the Transaction by reason of any action taken by or on behalf of COMPS. 4.7 Litigation. There is no action, order, writ, injunction, judgment, ---------- decree, claim, suit, litigation, proceeding, labor dispute, arbitral action, investigation or similar dispute of any sort whatsoever outstanding or pending or, to the Knowledge of COMPS, threatened or anticipated against, relating to, effecting or which would have reasonable potential to obstruct or prevent the consummation of the Transaction contemplated by this Agreement. 4.8 Liabilities. COMPS has no liabilities or obligations (absolute, ----------- accrued, contingent or otherwise), which may have had an adverse effect on this Transaction, except the liabilities which are reflected and reserved against on the COMPS' financial statements or liabilities incurred in the ordinary course of business and consistent with past practice which have not had, and could not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Effect on the Transaction. 4.9 Compliance with Law. COMPS is in compliance with all applicable laws, ------------------- statutes, ordinances and regulations in effect as of the Closing Date, whether federal, state or local, except where the failure to comply would not have a Material Adverse Effect on the Transaction. COMPS has not received any written notice to the effect that, or otherwise been advised that, it is not in compliance with any of such statutes, regulations, orders, ordinances or other laws where the failure to comply would have a Material Adverse Effect on the Transaction, and COMPS has no reason to anticipate that any presently existing circumstances are likely to result in violations of any such regulations which would, in any one case or in the aggregate, have a Material Adverse Effect on the Transaction. 4.10 COMPS Financial Statements. COMPS has delivered to REALBID its -------------------------- balance sheets for the year ended December 31, 1997 and the related income statements for the year ended December 31, 1997 (collectively, the "COMPS Financial Statements"). The COMPS Financial Statements (i) are in accordance with the books and records of COMPS, (ii) have been prepared in conformity with GAAP for the periods covered thereby, (iii) fairly, accurately and completely present the assets, liabilities and financial position and the results of operations of COMPS for the periods covered thereby and (iv) are true, correct and complete. 4.11 Absence of Certain Changes or Events for COMPS. Except as ---------------------------------------------- specifically set forth on Section 4.11 of the COMPS Disclosure Schedule, since ------------ December 31, 1997 and up to the Closing Date, COMPS has conducted business only in the ordinary and usual course and, there has not been any material adverse change in, or any event or development which, 20 individually or together with other such events, could reasonably be expected to result in a Material Adverse Effect on COMPS.. 4.12 Full Disclosure. All information requested by REALBID and the --------------- opportunity to enter into discussions with officers, employees and consultants of COMPS, at or before the Closing Date have been made available to REALBID and such information, together with the schedules, exhibits and any other agreements and certificates executed and delivered by COMPS pursuant to this Agreement, does not contain any untrue statement of material fact, or omits to state a material fact necessary to make the statements or facts contained herein or therein not misleading in light of the circumstances under which they were furnished. ARTICLE 5 [INTENTIONALLY LEFT BLANK] -------------------------- ARTICLE 6 CONDITIONS TO REALBID AND REALBID PRINCIPALS OBLIGATIONS -------------------------------------------------------- The obligations of REALBID and the REALBID Principals to consummate the Transaction provided for hereby are subject, in the reasonable discretion of REALBID, to the satisfaction, on or prior to the Closing Date, of each of the following conditions: 6.1 Representations, Warranties and Covenants. All representations and ----------------------------------------- warranties of COMPS contained in the Agreement (including the COMPS Disclosure Schedule) shall be true and correct at and as of the Closing Date and COMPS shall have performed all agreements and covenants required to be performed by it prior to or at the Closing Date. 6.2 No Litigation or Governmental Proceedings. There shall be no ----------------------------------------- litigation or proceeding pending or threatened against COMPS for the purpose on enjoining or preventing the consummation of the Agreement or otherwise claiming that such consummation is unlawful, an there shall be no governmental investigation or inquiry pending or threatened which in good faith judgment of REALBID or the REALBID Principals, might lead to or result in any litigation or proceeding of the nature referred to above. 6.3 Delivery at the Closing. COMPS shall have delivered to the REALBID ----------------------- Principals at the Closing: (a) One Hundred Sixty-Three Thousand Dollars ($163,000) by wire transfer in immediately available funds to the account specified by REALBID. (b) The employment agreements by and between COMPS and each of DeMoss and Potter, respectively, substantially in the form of Exhibit 6.3(b) attached -------------- hereto and by this reference incorporated herein (the "Employment Agreements"), duly executed by COMPS. (c) Stock option agreements in connection with the issuance of the options referenced in The Employment Agreements for DeMoss and Potter, duly executed by COMPS. 21 (d) Assignment and Assumption Agreement by and between COMPS and REALBID substantially in the form of Exhibit 6.3(d) attached hereto and by this -------------- reference incorporated herein (the "General Assignment"), duly executed by COMPS. (e) A certificate of an officer of COMPS substantially in the form of Exhibit 6.3(e) attached hereto and by this reference incorporated herein, to - -------------- evidence compliance with Section 6.1. ----------- (f) (i) Certified copies of the Certificate of Incorporation and Bylaws of COMPS and (ii) certificates of good standing for COMPS issued by the appropriate governmental office of its state of incorporation and each state in which it is qualified to do business. (g) Such other documents as REALBID may reasonably request for the purpose of facilitating the consummation of the Transaction. 6.4 Material Adverse Change. Since December 31, 1997, there shall have ----------------------- been no material adverse change in the business of COMPS, except such changes or circumstances as are contemplated, disclosed or required by the terms of this Agreement. ARTICLE 7 CONDITIONS TO COMPS' OBLIGATIONS -------------------------------- The obligations of COMPS to consummate the Transaction provided for hereby are subject, in the reasonable discretion of COMPS, to the satisfaction, on or prior to the Closing Date, of each of the following conditions: 7.1 Representations, Warranties and Covenants. All representations and ----------------------------------------- warranties of REALBID and REALBID Principals contained in the Agreement (including the Disclosure Schedule) shall be true and correct at and as of the Closing Date and REALBID and the REALBID Principals shall have performed all agreements and covenants required to be performed by them prior to or at the Closing Date. 7.2 No Governmental Proceedings or Litigation. There shall be no ----------------------------------------- litigation or proceeding pending or threatened against REALBID or the REALBID Principals for the purpose on enjoining or preventing the consummation of the Agreement or otherwise claiming that such consummation is unlawful, an there shall be no governmental investigation or inquiry pending or threatened which in good faith judgment of REALBID or the REALBID Principals, might lead to or result in any litigation or proceeding of the nature referred to above 7.3 Third Party Consents. REALBID shall have obtained all consents, -------------------- approvals and waivers from third parties and governmental and regulatory authorities necessary or appropriate to permit REALBID to perform its obligations hereunder and to consummate the Transaction hereby shall have been obtained, including without limitation the consents necessary for REALBID to assign the REALBID Assumed Contracts to COMPS. 7.4 Delivery at Closing. REALBID and the REALBID Principals shall have ------------------- delivered to COMPS at the Closing: 22 (a) Non-Competition Agreements by and between COMPS and each of the REALBID Principals and REALBID respectively, substantially in the form of Exhibit 7.4(a) attached hereto and by this reference incorporated herein (the - -------------- "Non-Competition Agreements"), duly executed by each of the REALBID Principals and REALBID. (b) Employment Agreements for DeMoss and Potter, duly executed by each of DeMoss and Potter. (c) Certified copies of the chartered documents and the operating agreement of REALBID and (ii) certificates of good standing for REALBID issued by the appropriate governmental office of its state of domicile and each state in which it is qualified to do business. (d) A certificate of the an officer of REALBID substantially in the form of Exhibit 7.4(d) attached hereto and by this reference incorporated herein, to -------------- evidence compliance with Section 7.1. ----------- (e) An original bill of sale substantially in the form of Exhibit 7.4(e) -------------- attached hereto and by this reference incorporated herein, duly executed by REALBID. (f) The General Assignment duly executed by REALBID. (g) An original assignment substantially in the form of Exhibit 7.4(g) -------------- attached hereto and by this reference incorporated herein of all the REALBID Intellectual Property. (h) A general release and waiver substantially in the form of Exhibit ------- 7.4(h) attached hereto and by this reference incorporated herein, duly executed - ------ by Institutional Real Estate, Inc. and Geoffrey Dohrmann. (i) Possession of all of the Purchased Assets, including all Books and Records relating to the Purchased Assets. (j) Such other documents as COMPS may reasonably request for the purpose of facilitating the consummation of the Transaction. 7.5 Material Adverse Change. Since the date of the LOI, there shall have ----------------------- been no material adverse change in the Business of REALBID, except such changes or circumstances as are contemplated, disclosed or required by the terms of the Agreement. ARTICLE 8 ACTIONS BY COMPS AND THE REALBID PRINCIPALS AFTER THE CLOSING ------------------------------------------------------------- 8.1 Survival of Representations. The representations and warranties of --------------------------- COMPS, REALBID and the REALBID Principals contained herein shall survive the Closing Date and shall thereafter continue in full force and effect for a period of twenty-four (24) months following the Closing Date, without regard to any investigation made by any of the parties hereto. 23 8.2 Indemnification. --------------- (a) By the REALBID Principals. The REALBID Principals shall, ------------------------- jointly and severally, indemnify, save and hold harmless COMPS, and its officers, directors, employees, agents, successors, affiliates and assigns and their respective representatives (collectively, the "COMPS Group") from and against any and all Damages, incurred in connection with, arising out of, resulting from or incident to (i) any breach of any covenant, representation, warranty or agreement or the inaccuracy of any representation, made by REALBID and/or the REALBID Principals in or pursuant to this Agreement, (ii) any liability, obligation or commitment of any nature (absolute, accrued, contingent or otherwise) relating to the Business and arising out of transactions entered into or events occurring prior to the Closing. (b) By COMPS. COMPS shall indemnify and save and hold harmless the -------- REALBID Principals, its affiliates and its and their respective representatives from and against any and all Damages incurred in connection with or arising out of or resulting from or incident to (i) any breach of any covenant, representation, warranty or agreement or the inaccuracy of any representation, made by COMPS in or pursuant to this Agreement or (ii) any liability, obligation or commitment of any nature (absolute, accrued, contingent or otherwise) relating to the business and arising out of transactions entered into or events occurring subsequent to the Closing which are not the subject of a matter covered in Section 8.2(a) or (iii) any claims arising out of the personal -------------- guarantees of Potter and DeMoss with respect to the equipment leases listed as items 3 and 4 of Section 3.11 of the Disclosure Schedule, provided that such claims are a result of a breach of such equipment leases by COMPS. (c) Assistance. The REALBID Principals and COMPS shall cooperate ---------- with one another in all reasonable respects, at their own cost, risk and expense, in the investigation, prosecution, trial, and defense of any lawsuit, claim, proceeding, arbitration or action that is subject to indemnification hereunder. (d) Defense of Claims. If any lawsuit or enforcement action is ----------------- filed against any party entitled to the benefit of indemnity hereunder, written notice thereof shall be given to the indemnifying party as promptly as practical (and in any event within fifteen (15) days after the service of the citation or summons); that the failure of any indemnified party to give timely notice shall not effect the rights to indemnification hereunder except to the extent that the indemnifying party demonstrates actual damage caused by such failure. After such notice, if the indemnifying party shall acknowledge in writing to the indemnified party that the indemnifying party shall be obligated under the terms of its indemnity hereunder in connection with such lawsuit or action, then the indemnified party shall be entitled, if it so elects, to take control of the defense and investigation of such lawsuit or action and to employ and engage attorneys of its own choice to handle and defend the same, at the indemnifying party's cost, risk and expense unless (i) the indemnifying party and the indemnified party has been advised in writing by counsel that there may be one or more legal defenses available to such indemnified that are different from or additional to those available to the indemnifying party, and to compromise or settle such claim, which compromise or settlement shall be made only with the written consent of the indemnifying party, such consent not to be unreasonably withheld. If the indemnified party notifies the indemnifying party that it does not want to assume the defense or it fails to assume the defense of such claim within fifteen (15) days after receipt of notice of the claim pursuant to 24 this Section 8.2, not to assume the defense, then the indemnifying party will be ----------- entitled to take control of the defense, at its own cost, risk and expense; provided, however, that such claim shall not be compromised or settled without the written consent of the indemnified party, which consent shall not be unreasonably withheld. In the event the indemnified party assumes defense of the claim, the indemnified party will keep the indemnifying party reasonably informed of the progress of any such defense, compromise or settlement. The indemnifying party shall be liable for any settlement of any action effected pursuant to and in accordance with this Section 8.2 and for any final judgment ----------- (subject to any right of appeal), and the indemnifying party agrees to indemnify and hold harmless an indemnified party from and against any Damages of such settlement of judgment. (e) Damages. The term "Damages" as used in this Section 8.2 shall ------- ----------- mean all costs, losses (including, without limitation, diminution in value), taxes, diminutions in value, liabilities, damages, lawsuits, deficiencies, claims and expenses (whether or not arising out of third party claims), including without limitation, interest, penalties, costs of mitigation, lost profits and other losses resulting from any shutdown or curtailment of operations, reasonable attorneys' fees and all amounts paid in investigation, defense or settlement of any of the foregoing. Damages are not limited to matters asserted by third parties against REALBID and the REALBID Principals or COMPS in the absence of third party claims. Payments by REALBID and the REALBID Principals or COMPS of amounts for which they are indemnified hereunder shall not be a condition precedent to recovery. The parties' obligation to indemnify one another shall not limit any other rights, including without limitation, rights of contribution they may have with respect to each other under statute or common law. (f) Limitation on Indemnification ----------------------------- (i) REALBID and the REALBID Principals shall have no liability for amounts payable to any member of the COMPS Group pursuant their indemnification obligations in this Article until the total of all exceeds ------- Twenty-Five Thousand Dollars ($25,000) in the aggregate after which the indemnification obligations of REALBID and the REALBID Principals shall include all such Damages as if this Section 8.2(f)(i) were not part of this Agreement. ----------------- (ii) REALBID and the REALBID Principals shall have no liability to any member of the COMPS Group pursuant to their indemnification obligations in this Article 8 to the extent that the total of all paid by REALBID and the --------- REALBID Principals in the aggregate to members of the COMPS Group pursuant to such indemnification obligations exceeds Three Hundred Thousand Dollars ($300,000); provided, however, that this clause (ii) shall not apply to any -------- ------- ----------- intentional breach by REALBID or any REALBID Principals of any covenant or agreement of such Seller. ARTICLE 9 MISCELLANEOUS ------------- 9.1 [INTENTIONALLY LEFT BLANK] 9.2 Notices. All notices, requests and other communications hereunder must ------- be in writing and will be deemed to have been duly given only if delivered personally against written 25 receipt or by facsimile transmission with answer back confirmation or mailed (postage prepaid by certified or registered mail, return receipt requested) or by overnight courier to the parties at the following addresses or facsimile numbers: If to COMPS, addressed to: COMPS InfoSystems, Inc. 9888 Carroll Centre Road, Suite 100 San Diego, CA 92126 Facsimile No.: (619) 684-3292 Attn: Christopher Crane With a copy to: Brobeck, Phleger & Harrison LLP 550 West "C" Street, Suite 1200 San Diego, CA 92101 Facsimile No.: (619) 234-3848 Attn: Craig S. Andrews, Esq. If to REALBID or the REALBID Principals addressed to: REALBID LLC 700 Larkspur Landing Circle, Suite 199 Larkspur, CA 94939 Facsimile No.: (415) 464-4944 Attn: Mr. Emmett DeMoss & Mr. Robert Potter With a copy to: Luce, Forward, Hamilton & Scripps LLP 600 West Broadway, Suite 2600 San Diego, CA 92101 Facsimile No.: (619) 232-8311 Attn: Dennis J. Doucette, Esq. All such notices, requests and other communications will (i) if delivered personally to the address as provided in this Section 9.2, be deemed given upon ----------- delivery, (ii) if delivered by facsimile transmission to the facsimile number as provided in this Section 9.2, be deemed given upon receipt, and (iii) if ----------- delivered by mail in the manner described above to the address as provided in this Section 9.2, be deemed given upon receipt (in each case regardless of ----------- whether such notice, request or other communication is received by any other person to whom a copy of such notice, request or other communication is to be delivered pursuant to this Section). Any party from time to time may change its address, facsimile number or other information for the purpose of notices to that party by giving notice specifying such change to the other parties hereto. 26 9.3 Choice of Law. This Agreement shall be construed, interpreted and the ------------- rights of the parties determined in accordance with the laws of the State of California, without reference to the choice of law provisions thereof. 9.4 Entire Agreement; Amendments and Waivers. This Agreement, together ---------------------------------------- with all schedules and exhibits hereto, constitutes the complete, final and exclusive statement of the terms of the agreement among the parties pertaining to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and discussions of the parties. No modification or rescission of this Agreement shall be binding unless executed in writing by the party to be bound thereby. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided. 9.5 Counterparts. This Agreement may be executed in one or more ------------ counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 9.6 Expenses. Except as expressly provided herein, each party hereto shall -------- pay its own legal, accounting, and other expenses incident to this Agreement and to any action taken by such party in preparation for carrying this Agreement into effect. 9.7 Invalidity. In the event that any one or more of the provisions ---------- contained in this Agreement or in any other instrument referred to herein, shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, then to the maximum extent permitted by law, such invalidity, illegality or unenforceability shall not effect any other provision or this Agreement or nay other such instrument. 9.8 Confidentiality. --------------- (a) Except as and to the extent required by law, the parties hereto will not disclose or use, and will direct their respective representatives not to disclose or use to the detriment of the other parties, any Confidential Information (as defined below) with respect to such other party furnished, or to be furnished, by such other party or its representatives to the disclosing party or its representatives at any time or in any manner other than in connection with the transaction contemplated in this Agreement. Notwithstanding the foregoing, Confidential Information shall not include any information which is generally known to the public or to companies in businesses similar to the Business, or which later, through no act of the disclosing party, becomes generally known. (b) Upon consummation of this Agreement, REALBID shall (a) return to COMPS, or shall destroy in a manner satisfactory to COMPS, all tangible forms of Confidential Information provided by COMPS, including any and all copies thereof, and those portions of any documents, memoranda, notes, studies and analyses prepared by or on behalf of REALBID or any of its directors, officers, employees, advisors or representatives that incorporate or are derived from such Confidential Information, and (b) immediately cease, and shall cause its directors, officers, employees, partners, advisors and representatives to cease, use of such 27 Confidential Information as well as any information or materials that incorporate or are derived from such Confidential Information. (c) "Confidential Information" means all of the following (whether or not reduced to writing and whether or not patentable or protected by copyright): (i) any and all trade secrets concerning the business and affairs of any person or entity, product specifications, data, know-how, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, past, current and planned research and development, current and planned manufacturing and distribution methods and processes, customer lists, current and anticipated customer requirements, price lists, market studies, business plans, computer software and programs (including object code and source code), computer software and database technologies, systems, structures and architectures (and related processes, formulae, compositions, improvements, derivatives, devices, know-how, inventions, discoveries, concepts, ideas, designs, methods and information) of a person or entity and any other information, however, documented, of a person or entity that is a trade secret within the meaning of any and all applicable state and federal trade secret laws; (ii) any and all information concerning the business and affairs of a person or entity (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel and personnel training and techniques and materials), however documented; and (iii) any and all notes, analysis, compilations, studies, summaries, and other material prepared by or for a person or entity containing or based, in whole or in part, on any information included in the foregoing. 9.9 Arbitration and Venue. Any controversy or claim arising out of or --------------------- relating to this Agreement or the making, performance or interpretation thereof shall be submitted to arbitration in San Diego, California, pursuant to the rules and procedures of the American Arbitration Association before a panel of three arbitrators. The ruling of the arbitrator shall be final, and judgment thereon may be entered in any court having jurisdiction. If any question is submitted to a court of law for resolution, then the Superior Court of the County of San Diego, California, or the United States District Court having jurisdiction in the County of San Diego, shall be the exclusive court of competent jurisdiction for the resolution of such question. Each party will bear one half of the cost of the arbitration filing and hearing fees, and the cost of the arbitrator. Each party will bear its own attorneys' fees, unless otherwise decided by the arbitrator. The parties understand and agree that the arbitration shall be instead of any civil litigation and that the arbitrator's decision shall be final and binding to the fullest extent permitted by law and enforceable by any court having jurisdiction thereof. Each party shall be entitled to pre-hearing discovery as provided in California Code of Civil Procedure Section 1283.05. 9.10 Announcements. Neither COMPS, REALBID, the REALBID Principals nor any ------------- of their respective affiliates shall issue or authorize to be issued any press release or similar announcement concerning the Letter of Intent, this Agreement, or the Transaction contemplated hereby, without the prior written approval of the parties hereto. 9.11 Construction. No provision of this Agreement shall be construed in ------------ favor of or against any party on the ground that such party or its counsel drafted the provision. Any remedies provided for herein are not exclusive of any other lawful remedies which may be 28 available to either party. This Agreement shall at all times be construed so as to carry out the purposes stated herein. 9.12 Schedules and Exhibits not Attached. Any item disclosed hereunder ----------------------------------- (including in any schedule or exhibit hereto or thereto) shall be deemed disclosed for all purposes hereof irrespective of the specific representation or warranty to which it is explicitly referenced. Without limiting the generality of the foregoing, the fact that any disclosure on any of the schedules or exhibits hereto or thereto is not required to be disclosed in order to render the applicable representation or warranty to which it relates true, or that the absence of such disclosure on the schedules or exhibits hereto or thereto would not constitute a breach of such representation or warranty, shall not be deemed or construed to expand the scope of any representation or warranty hereunder or to establish a standard of disclosure in respect of any representation or warranty. 9.13 Severability. If any term, provision, covenant or restriction of this ------------ letter is held by an arbitrator or a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions contained within this letter will remain in full force and effect and will in no way be affected, impaired or invalidated. 9.14 Assignment. This Agreement and all right hereunder shall not be ---------- assignable by any party without the prior written consent of the other party, except by will or the laws of descent and distribution. Subject to the foregoing, all of the terms of this Agreement shall be binding upon and inure to the benefit of an be enforceable by the parties and their respective heirs, executors, administrators, personal representatives, successors and permitted assigns. Except as expressly stated, nothing herein shall be deemed to confer any benefit upon any person or business entity that is not a party to this Agreement. Notwithstanding the foregoing, COMPS may assign its rights under this Agreement to a wholly owned subsidiary. 29 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written. COMPS InfoSystems, Inc., REALBID LLC, a Delaware corporation a California limited liability company By: /s/ Christopher A. Crane By: /s/ Robert A. Potter -------------------------------------- -------------------------------- Christopher A. Crane Robert A. Potter, Manager President and Chief Executive Officer By: /s/ Emmett DeMoss -------------------------------- Emmett DeMoss, Manager THE REALBID PRINCIPALS /s/ Robert Potter ----------------------------------- Robert Potter /s/ Emmett DeMoss ----------------------------------- Emmett DeMoss Exhibit 6.3(b) -------------- Forms of Employment Agreements See Exhibit 10.17 to Registration Statement on Form S-1 Exhibit 6.3(d) -------------- Form of Assignment and Assumption Agreement See Exhibit 10.39 to Registration Statement on Form S-1 Exhibit 6.3(e) -------------- Form of COMPS Officer Certificate CERTIFICATE OF OFFICER COMPS INFOSYSTEMS, INC. This Certificate is delivered pursuant to Section 6.3(e) of that certain Asset Purchase Agreement (the "Agreement"), dated as of __________________, 1998, by and among COMPS InfoSystems, Inc., REALBID LLC, Emmett DeMoss and Robert Potter. Capitalized terms used herein without definition shall have the same meaning as set forth in the Agreement. I, ________________________, do hereby certify that I am the duly elected, qualified and acting ______________________ of COMPS and as such, am authorized to execute this Certificate on its behalf, and I further certify that: 1. All representations and warranties of COMPS contained in the Agreement are true and correct on and as of the date hereof COMPS has performed all agreements and covenants in a timely manner required to be performed by it prior to or on the date hereof. 2. No actions or proceedings have been instituted or threatened which question the validity or legality of the transactions contemplated by the Agreement. 3. All Permits, authorizations, consents, approvals and waivers from third parties and governmental or regulatory authorities and other persons or entities necessary or appropriate to permit COMPS to perform its obligations hereunder and to consummate the transactions contemplated by the Agreement have been obtained. IN WITNESS WHEREOF, I have executed this Certificate as of the Closing Date, this ____ day of November, 1998. By:__________________________ Name:________________________ Title:_______________________ Exhibit 7.4(a) -------------- Forms of Non-Competition Agreements See Exhibit 10.19 to Registration Statement on Form S-1 Exhibit 7.4(d) -------------- Form of REALBID Officer Certificate CERTIFICATE OF OFFICER REALBID LLC This Certificate is delivered pursuant to Section 7.4(d) of that certain Asset Purchase Agreement (the "Agreement"), dated as of __________________, 1998, by and among COMPS InfoSystems, Inc., REALBID LLC, Emmett DeMoss and Robert Potter. Capitalized terms used herein without definition shall have the same meaning as set forth in the Agreement. I, ________________________, do hereby certify that I am the duly elected, qualified and acting ______________________ of REALBID and as such, am authorized to execute this Certificate on its behalf, and I further certify that: 1. All representations and warranties of REALBID and the REALBID Principals contained in the Agreement are true and correct on and as of the date hereof and REALBID and the REALBID Principals have performed all agreements and covenants in a timely manner required to be performed by them prior to or on the date hereof. 2. No actions or proceedings have been instituted or threatened which question the validity or legality of the transactions contemplated by the Agreement. 3. All Permits, authorizations, consents, approvals and waivers from third parties and governmental or regulatory authorities and other persons or entities necessary or appropriate to permit REALBID and the REALBID Principals to perform their respective obligations hereunder and to consummate the transactions contemplated by the Agreement have been obtained. IN WITNESS WHEREOF, I have executed this Certificate as of the Closing Date, this ____ day of November, 1998. By:______________________ Name:____________________ Title:___________________ Exhibit 7.4(e) -------------- Form of Bill of Sale THIS BILL OF SALE dated as of ____________, 1998, is being executed and delivered by REALBID LLC, a California limited liability company, Emmett DeMoss, and Robert Potter (collectively, "Sellers") pursuant to that certain Asset Purchase Agreement dated as of November 6, 1998 (the "Purchase Agreement"), by and among Sellers and COMPS InfoSystems, Inc., a Delaware corporation ("Buyer"). The execution and delivery of this Bill of Sale is a condition to Buyer's obligations under the Purchase Agreement. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Sellers hereby agree as follows: 1. Capitalized terms used herein but not defined herein shall have the meanings assigned such terms in the Purchase Agreement. Subject to the terms and conditions set forth in the Purchase Agreement, Sellers hereby grants, sell, convey, assign, transfer and deliver to Buyer, and Buyer hereby acquires from Sellers, free and clear of any Encumbrance or adverse claim of any kind whatsoever (except Permitted Encumbrances), all of REALBID LLC's ("REALBID") right, title, and interest in and to all assets, properties, rights, leases, fixtures, accessions, claims, contracts and interests of REALBID of every kind, type or description, real, personal and mixed, tangible and intangible, wherever located and whether or not specifically referred to in this Agreement, that are used in or pertain to the Business (collectively, the "Purchased Assets"), including without limitation: (a) the machinery, equipment, leasehold improvements, furniture and fixtures, vehicles and other operating assets owned or leased by REALBID and used in the Business as set forth in Schedule 2.1(a) to the Purchase Agreement; --------------- (b) the miscellaneous supplies of REALBID used in connection with the Business; (c) REALBID's right, title and interest in and to license agreements, supply agreements, sales and purchase agreements, real property leases, orders and the other contracts and agreements, written or oral, necessary for REALBID to operate the Business as set forth in Schedule 2.1(c) to --------------- the Purchase Agreement (and to the extent oral, accurately described in Schedule -------- 3.11 of the Disclosure Schedule the terms of such contract; - ---- (d) to the extent assignable, all licenses, permits, consents, approvals, orders, certificates, authorizations, declarations and filings held by REALBID necessary or incidental to the conduct of the Business set forth in Schedule 2.1(d) to the Purchase Agreement; - --------------- (e) all of REALBID's customer lists, mailing lists, telephone numbers, correspondence, credit, sales and other records, business and accounting records, computer printouts, vendor lists, and sales and other literature, operating data, and books, files, documents and records relating to the Business (collectively, the "Books and Records"); provided, that REALBID will retain certain Books and Records necessary for REALBID to wind up its involvement in the Business and provide COMPS, at the sole cost and expense of COMPS, with access to such Books and Records upon reasonable prior request and during normal business hours as necessary to conduct the Business after the Closing Date (as defined below); (f) all right, title and interest in and to all of the REALBID Intellectual Property, including without limitation (i) all of REALBID's rights to the name "REALBID" and variations thereof and all trademarks, tradenames, service marks and goodwill associated therewith, (ii) the domain name on the World Wide Web known as "realbid.com" and any successor name thereto and (iii) all items set forth in Section 3.24 of the Disclosure Schedule and all ------------ improvements, modifications and other Intellectual Property derived therefrom; (h) all prepaid expenses, deposits and deferred items in effect as of the Closing Date and from which COMPS may derive future benefit; (i) all accounts, accounts receivable, notes and notes receivable of REALBID's Business as of the Closing Date, including without limitation those which are not evidenced by instruments or invoices, whether or not they have been earned by performance or have been written off or reserved against as a bad debt or doubtful account, together with all instruments and all documents of title representing any of the foregoing and all right, title, security and guaranties in favor of REALBID with respect to any of the foregoing, as identified in Schedule 2.1(h) to the Purchase Agreement; --------------- (j) the real properties leased or owned by REALBID set forth on Schedule 2.1(i) to the Purchase Agreement; (k) all cash and cash equivalents of REALBID as of the Closing Date; and (l) the goodwill and going concern value of REALBID's Business. 2. Buyer hereby waives compliance by Sellers with the provisions of the bulk transfer laws of any state. Sellers warrant and agree to pay and discharge when due all claims of creditors which could be asserted against Buyer by reason of such noncompliance. Pursuant to the terms of the Purchase Agreement, Sellers shall indemnify and hold Buyer harmless from, against and in respect of (and shall on demand reimburse Buyer for) any Damages suffered or incurred by Buyer by reason of the failure of Sellers to pay or discharge such claims. 3. From time to time after the date hereof, Sellers will execute and deliver, or cause its affiliates to execute and deliver, to Buyer such instruments of sale, transfer, conveyance, assignment and delivery, and such consents, assurances, powers of attorney and other instruments as may be reasonably requested by Buyer or its counsel in order to vest in the Company all right, title and interest of Seller in and to the Purchased Assets and otherwise in order to carry out the purpose and intent of this Bill of Sale. 2 4. Notwithstanding any other provisions of this Bill of Sale to the contrary, nothing contained in this Bill of Sale shall in any way supersede, modify, replace, amend, change, rescind, waive, exceed, expand, enlarge or in any way affect the provisions, including warranties, covenants, agreements, conditions, representations or, in general any of rights and remedies, and any of the obligations and indemnifications of Sellers or Buyer set forth in the Purchase Agreement nor shall this Bill of Sale expand or enlarge any remedies under the Purchase Agreement including without limitation any limits on indemnification specified therein. This Bill of Sale is intended only to effect the transfer of certain property transferred pursuant to the Purchase Agreement and shall be governed entirely in accordance with the terms and conditions of the Purchase Agreement. 5. This Bill of Sale shall in all respects be construed in accordance with and governed by the laws of the State of California without giving effect to its conflicts-of-laws principles (other than any provisions thereof validating the choice of the laws of the State of California in the governing law). 6. This Bill of Sale may be executed by the parties herein in separate counterparts and by facsimile, each of which when so executed and delivered shall be an original, but all such counterparts and facsimile shall together shall constitute one and the same instrument. [SIGNATURE PAGE TO FOLLOW] 3 IN WITNESS WHEREOF, Sellers have caused this Bill of Sale to be executed and delivered on the date and year first written above. REALBID LLC, a California limited liability company By:_____________________________________ Robert A. Potter, Manager By:_____________________________________ Emmett DeMoss, Manager ________________________________________ Emmett DeMoss ________________________________________ Robert A. Potter [SIGNATURE PAGE TO THE BILL OF SALE] Exhibit 7.4(g) -------------- Form of Intellectual Property Assignment See Exhibit 10.40 to Registration on Form S-1 Exhibit 7.4(h) -------------- Form of General Release and Waiver GENERAL RELEASE AND WAIVER -------------------------- THIS RELEASE (this "Agreement"), effective as of November ___, 1998, is entered into by and among Institutional Real Estate, Inc., a California corporation ("IREI"), Geoffrey Dohrmann, in his individual capacity ("Mr. Dohrmann"), COMPS INFOSYSTEMS, INC., a Delaware corporation ("COMPS"), and REALBID LLC, a California limited liability company ("REALBID"); WHEREAS, Mr. Dohrmann is the majority shareholder and President of IREI; WHEREAS, IREI owns twenty-five percent (25%) of the membership interest in REALBID; WHEREAS, IREI claims to be entitled to certain consideration from the sale by REALBID of substantially all of its assets to COMPS pursuant to that certain Asset Purchase Agreement dated November 6, 1998 by and among COMPS, REALBID, Emmett DeMoss and Robert Potter; WHEREAS, the parties to this Agreement intend and desire to avoid the risks and expenses attendant upon litigation of such dispute and to effect and accomplish a full and final settlement of all rights, claims and demands IREI or Mr. Dohrmann may have against COMPS and/or REALBID; NOW, THEREFORE, the parties hereto, in and for the consideration of the representations, promises, and agreements contained herein, do agree as follows: 1. Concurrently with the execution and delivery of this Agreement by IREI and Mr. Dohrmann, COMPS shall grant IREI stock options to purchase that number of shares of COMPS Class B Common Stock equal to 1.25% of the issued and outstanding shares of COMPS Class B Common Stock as of the date hereof as consideration for a release and waiver by IREI and Mr. Dohrmann pursuant to Section 2 and Section 3 hereof. 2. IREI, on behalf of itself, as well as on behalf of its past and present directors, shareholders, officers, employees, agents, predecessors, successors, attorneys, representatives, affiliates, partners, joint venturers and assigns, if any, and Mr. Dohrmann, on behalf of himself, as well as on behalf of his past and present agents, employees, successors, attorneys, representatives, affiliates, partners, joint venturers and assigns, if any, hereby forever release, acquit and discharge, COMPS and REALBID, as well as their respective past and present directors, officers, managers, members, shareholders, agents, employees, successors, attorneys, representatives, affiliates, partners, joint venturers and assigns, if any, from any and all claims, demands, actions, causes of action, cross claims, counter claims, obligations, indemnities, contributions, suits, debts, sums, accounts, controversies, damages, costs, attorneys' fees, defenses, and liabilities of any kind whatsoever, whether in law or in equity, whether contractual, common law, statutory, federal, state, or otherwise (collectively, "Claims"), whether known or unknown, whether suspected to exist or not, that IREI or Mr. Dohrmann has, ever had, or hereafter may have or claim to have, against COMPS or REALBID or any of their respective past and present directors, officers, managers, members, shareholders, agents, employees, successors, attorneys, representatives, affiliates, partners, joint venturers and assigns, if any. 3. IREI and Mr. Dohrmann may have Claims against COMPS and REALBID, as well as their respective past and present directors, officers, managers, members, shareholders, partners, affiliates, joint venturers, agents, employees, successors, attorneys, and assigns, if any, of which, at the time this Agreement is executed, IREI or Mr. Dohrmann has no knowledge or suspicion. However, the parties hereby agree and represent that this Agreement is specifically intended to, and does, extend to any and all such Claims, whether or not known, claimed, or suspected by IREI or Mr. Dohrmann, and, therefore, IREI and Mr. Dohrmann, on behalf of themselves, as well as on behalf of their respective past and present directors, officers, agents, employees, successors, attorneys, and assigns, if any, hereby expressly waive with respect to the claims described in this Section 3 the benefits of Section 1542 of the California Civil Code which provides: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR." 4. This Agreement is a release and compromise of disputed claims and none of the parties hereto by its execution of this Agreement is making an admission of liability or against their respective interest. 5. The terms of this Agreement shall be binding on and inure to the benefit of each of the directors, officers, manager, agents, employees, successors, attorneys, and assigns, if any, of each of the parties hereto. 6. If any legal action or any arbitration or other proceeding is brought for the enforcement of this Agreement, or because of an alleged dispute, breach, default, or misrepresentation in connection with any of the provisions of this Agreement, the successful or prevailing party or parties shall be entitled to recover reasonable attorneys' fees and other costs incurred in that action or proceeding, in addition to any other relief to which it or they may be entitled. 7. Each party hereto hereby acknowledges that it has sought or has the right, ability or opportunity to seek the advice of legal counsel prior to the execution of this Agreement. 8. This Agreement shall be governed by and construed in accordance with the laws of the State of California. 2 9. If any term, provision, covenant or restriction of this Agreement is held by an arbitrator or a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions contained within this agreement will remain in full force and effect and will in no way be affected, impaired or invalidated. 10. This Agreement constitutes the complete, final and exclusive statement of the terms of the Agreement among the parties hereto pertaining to the subject matter hereof and supersedes all prior agreements, understandings, negotiations and discussions of the parties hereto. No amendment, modification or recession of this Agreement shall be binding unless executed in writing by the party to be bound thereby. No waiver of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided. 11. Each party hereto, at the request of any of the other parties hereto, shall execute and deliver such other instruments and do and perform such other acts and things as may be necessary or desirable for effecting completely the consummation of this Agreement and the transactions contemplated hereby. 12. This Agreement may be executed in any number of counterparts and by facsimile, each of which shall be deemed an original, but all such counterparts shall constitute but one and the same instrument, and this Agreement shall become effective upon the execution and delivery of a counterpart hereof by each of the parties hereto. [Signature Page To Follow] 3 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above set forth. COMPS INFOSYSTEMS, INC., a Delaware Corporation DATED: November ___, 1998 By:_____________________________ Name:___________________________ Title:__________________________ REALBID LLC, a California limited liability company DATED: November ___, 1998 By:_____________________________ Robert Potter, Manager DATED: November ___, 1998 By:_____________________________ Emmett DeMoss, Manager INSTITUTIONAL REAL ESTATE, INC., a California corporation DATED: November ___, 1998 By:_____________________________ Name:___________________________ Title:__________________________ DATED: November ___, 1998 ________________________________ Geoffrey Dohrmann 4 COMPS DISCLOSURE SCHEDULES Section 4.1 ORGANIZATION OF COMPS. --------------------- None. Section 4.2 CAPITALIZATION. -------------- No options or warrants were exercised between October 28, 1998 and the Closing Date. Section 4.3 AUTHORIZATION. ------------- None Section 4.4 NO CONFLICT OR VIOLATION. ------------------------ Mr. Christopher Crane is a partner in a partnership that owns the building where COMPS' San Diego office is located. Section 4.5 CONSENTS AND APPROVALS. ---------------------- Under the Loan Agreement dated September 24, 1996 by and between COMPS InfoSystems, Inc.and Venture Lending & Leasing, Inc. (the "Lender"), the Lender's prior written consent is required for COMPS to consummate the Transactions. Section 4.6 NO BROKERS. ---------- None Section 4.7 LITIGATION. ---------- None Section 4.8 LIABILITIES. ----------- None Section 4.9 Compliance with Law. None Section 4.10 COMPS Financial Statements. None COMPS DISCLOSURE SCHEDULE PAGE 2 Section 4.11 Absence of Certain Changes or Events for COMPS. None Section 4.12 Full Disclosure. None SCHEDULE 2.1(A) Fixed Assets SCHEDULE 2.1(A) Fixed Assets All of the computer equipment described in Items 3 and 4 of Section 3.11 of the Disclosure Schedule and one fax machine located at REALBID's offices, 700 Larkspur Landing Circle, Suite 199, Larkspur, California 94939. SCHEDULE 2.1(C) REALBID Assumed Contracts SCHEDULE 2.1(C) REALBID ASSUMED CONTRACTS Each of the contracts and agreements described in Items 1, 3, 4, 5, 6 and 7 of Section 3.11 of the Disclosure Schedule. SCHEDULE 2.1(D) REALBID Permits SCHEDULE 2.1(D) REALBID PERMITS None. SCHEDULE 2.1(H) REALBID Accounts Receivables SCHEDULE 2.1(H) REALBID ACCOUNTS RECEIVABLES See attached. REALBID LLC A/R Aging Detail As of October 31, 1998
Type Date Num P.O.# Name Terms Due Date Class Current Invoice 10/7/98 108 *** Net 30 11/6/98 Brokers Invoice 10/12/98 109 *** Net 30 11/11/98 Brokers Invoice 10/12/98 110 *** Net 30 11/11/98 Brokers Invoice 10/30/98 113 *** Net 30 11/29/98 Brokers Total Current 1 - 30 Invoice 9/1/98 71 *** Net 30 10/1/98 Realty Advis.... Invoice 9/3/98 72 *** Net 30 10/3/98 Brokers Invoice 10/7/98 107 *** 10/7/98 Life Insuranc... Invoice 9/18/98 74 *** Net 30 10/8/98 Brokers Payment 10/9/98 *** Invoice 9/15/98 77 *** Net 30 10/15/98 Brokers Invoice 9/15/98 78 *** Net 30 10/15/98 Brokers Invoice 9/15/98 80 *** Net 30 10/15/98 Builders/Dev.... Invoice 9/15/98 81 *** Net 30 10/15/98 Realty Advis.... Invoice 9/15/98 84 *** Net 30 10/15/98 Brokers Invoice 9/23/98 95 *** Net 30 10/23/98 Realty Advis.... Invoice 9/29/98 102 *** Net 30 10/29/98 Brokers Invoice 10/30/98 114 *** 10/30/98 Brokers Invoice 10/30/98 115 *** 10/30/98 Total 1 - 30 31 - 60 Invoice 8/18/98 65 *** Net 30 9/17/98 Realty Advis.... Invoice 9/23/98 94 *** 9/23/98 Brokers Invoice 9/23/98 96 *** 9/23/98 Brokers Invoice 9/23/98 98 *** 9/23/98 Corporation Invoice 8/27/98 69 *** Net 30 9/26/98 Brokers Invoice 8/28/98 67 *** Net 30 9/27/98 Brokers Invoice 9/28/98 101 *** 9/28/98 Life Insuranc.... Total 31 - 60 61 - 90 Invoice 7/20/98 55 *** Net 30 8/19/98 Brokers Total 61 - 90 greater than 90 Invoice 4/24/98 24 *** 4/26/98 Realty Advis Invoice 5/14/98 33 *** Net 30 6/13/98 Brokers Invoice 5/27/98 38 *** Net 30 6/26/98 Realty Advis Invoice 5/27/98 39 *** Net 30 6/26/98 Broker Total greater than 90 TOTAL Type Aging Open Balance Current Invoice 2,500.00 Invoice 2,500.00 Invoice 2,500.00 Invoice 2,500.00 ------------ Total Current 10,000.00 1 - 30 Invoice 30 3,000.00 (1) Invoice 28 2,500.00 Invoice 24 2,500.00 Invoice 23 2,500.00 (2) Payment -1,000.00 (3) Invoice 16 500.00 Invoice 16 500.00 Invoice 16 2,500.00 Invoice 16 2,500.00 Invoice 16 2,500.00 (4) Invoice 8 2,500.00 Invoice 2 2,500.00 Invoice 1 2,500.00 Invoice 1 2,500.00 ------------ Total 1 - 30 28,000.00 31 - 60 Invoice 44 2,500.00 Invoice 38 2,500.00 Invoice 38 1,500.00 Invoice 38 2,000.00 (7) Invoice 35 750.00 Invoice 34 5,000.00 Invoice 33 2,500.00 ------------ Total 31 - 60 16,750.00 61 - 90 Invoice 73 1,750.00 (5) ------------ Total 61 - 90 1,750.00 greater than 90 Invoice 190 1,500.00 Invoice 140 4,000.00 (6) Invoice 123 2,500.00 Invoice 123 2,500.00 ------------ Total greater than 90 10,500.00 TOTAL 67,800.00
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. SCHEDULE 2.1(I) Assumed Real Property SCHEDULE 2.1(I) ASSUMED REAL PROPERTY The leasehold interest described in Item 1 of Schedule 3.11 of the Disclosure Schedule. SCHEDULE 2.3 Excluded Assets SCHEDULE 2.3 EXCLUDED ASSETS All office furniture and filing cabinets and the color printer located at REALBID's offices, 700 Larkspur Landing Circle, Suite 199, Larkspur, California 94939. REALBID DISCLOSURE SCHEDULE --------------------------- REALBID, LLC DISCLOSURE SCHEDULE DATED OCTOBER 28, 1998 Section 3.1 Ownership of REALBID Interests ------------------------------ Emmett DeMoss: 3,000 Members' Shares Robert Potter: 3,000 Members' Shares Institutional Real Estate, Inc.: 2,000 Member's Shares SECTION 3.2 Organization and Good Standing ------------------------------ None. SECTION 3.2 Authorization ------------- None. SECTION 3.4 Equity Securities of REALBID ---------------------------- None. SECTION 3.5 No Conflict or Violation ------------------------ See Section 3.6 hereof. SECTION 3.6 Consents and Approvals ---------------------- 1. Consent of Landlord with respect to lease referenced in Item 1 of Section 3.11 hereof is required for assignment. 2. Consent of Lessor with respect to the equipment leases referenced in Items 3 and 4 of Section 3.11 hereof is required for assignment SECTION 3.7 Books and Records ----------------- None. SECTION 3.8 Financial Statements -------------------- See attached financial statements: (a) balance sheets as of December 31, 1997 and October 31, 1998; and (b) income statements for the year ended December 31, 1997 and for the period ended October 31, 1998. SECTION 3.9 Accounts Receivable ------------------- None. SECTION 3.10 Absence of Certain Changes or Events ------------------------------------ None. SECTION 3.11 Contracts and Commitments ------------------------- List of Assumed Contracts and Other Contracts: - --------------------------------------------- 1. Office Sublease and Service Agreement dated July 6, 1998 between Executive Business Network, Inc. d/b/a/ Executive Business Centers and REALBID, LLC for premises located at 700 Larkspur Landing Circle, Suite 199, Larkspur, California 94939. 2. Contribution Agreement dated July 1, 1997 by and among REALBID and the REALBID Principals. 3. Business Lease Agreement (Lease #521542) between Dana Commercial Credit Corporation and REALBID for computer equipment listed on Schedule A thereto. 4. Business Lease Agreement (Lease #535079) between Dana Commercial Credit Corporation and REALBID for computer equipment described therein. 5. Web Hosting and Maintenance Agreement dated January 1, 1998 between REALBID and RealPage Communications, Inc. ("RealPage"). 6. Marketing Services Agreement dated August 15, 1997 between REALBID and Prudential Insurance Company of America. 7. Oral Agreements All of REALBID's customer agreements with the exception of the agreement reference in Item 6 of this Section 3.11 are oral agreements whereby REALBID posts the subject property at its web site and then broadcasts the availability of the property for sale to buyers whose acquisition parameters meet the characteristics of the property. See Schedule 2.1(h) for a list of clients for which REALBID has an oral agreement and see Attachment 3.11(7)-A hereto. SECTION 3.11(A) None. SECTION 3.11(B) See Section 3.12 hereof. SECTION 3.11(C) None. SECTION 3.11(D) None. SECTION 3.12 Insurance --------- The lease listed as Item 1 of Section 3.11 hereof requires that REALBID maintain bodily injury insurance of at least $300,000 per person and $1,000,000 per occurrence and property damage insurance of at least $200,000 per accident or occurrence. REALBID does not maintain such insurance. The leases listed as Items 3 and 4 of Section 3.11 hereof require REALBID to pay, and REALBID has paid, a risk charge of 125% of the original equipment cost until REALBID obtains insurance for such equipment. SECTION 3.13 Litigation ---------- None. SECTION 3.14 Liabilities ----------- None. SECTION 3.15 Compliance with Law ------------------- REALBID has not complied with local ordinances (if any) requiring REALBID to maintain a business license or similar permit. SECTION 3.16 No Brokers ---------- None. SECTION 3.17 No Other Agreements to Sell REALBID ----------------------------------- None. SECTION 3.18 Tax Matters ----------- None. SECTION 3.19 Employment Matters and Benefit Plans ------------------------------------ None. SECTION 3.20 Transaction with Certain Persons -------------------------------- None. SECTION 3.21 Environmental Quality --------------------- None. SECTION 3.22 Certain Advances ---------------- None. SECTION 3.23 Licenses and Permits -------------------- None. SECTION 3.24 Proprietary Rights ------------------ (a) None. (b) None. (c) (i) Service mark for "REALBID" (application No. 75/277,110), filed with U.S. Patent and Trademark Office), copyrighted material including information and text on REALBID's website and REALBID's buyer profile database, domain name of "www.realbid.com" and any and all software developed by RealPage Communications, Inc. in connection with the agreement listed as Item 5 of Section 3.11 hereof. (ii) See "Attachment 3.24(c)" attached hereto for a description of the services offered by REALBID. (iii) See Item 5 of Section 3.11 hereof. (d) None. (e) None. (f) None. (g) None. (h) None. (i) See item 5 of Section 3.11 hereof. Pursuant to the terms of such agreement, RealPage has agreed to implement, support, host and maintain REALBID's website. Such agreement has a term of one year commencing on January 1, 1998 and may be terminated by either REALBID or RealPage upon 30 days' prior written notice. SECTION 3.25 Material Misstatements or Omissions ----------------------------------- None. SECTION 3.26 Exclusive Dealing ----------------- None. SECTION 3.27 Lease ----- See lease listed as Item 1 of Section 3.11 hereof. SECTION 3.28 Location of Purchased Assets ---------------------------- The Purchased Assets are located at 700 Larkspur Landing Circle, Suite 199, Larkspur, California 94939. The computer equipment reference in Items 3 and 4 of Section 3.11 hereof is subject to the equipment leases referenced therein and the Assumed Real Property is subject to the lease referenced in Item 1 of Section 3.11 hereof. SECTION 3.29 Prepaid Expenses ---------------- None. SECTION 3.30 Certain Agreements ------------------ None. SECTION 3.31 Year 2000 Compliance -------------------- None. SECTION 3.32 Necessary Property ------------------ The Excluded Assets are currently used in operation of REALBID's business. SECTION 3.33 Bank Accounts ------------- Wells Fargo Bank 100 Bon Air Center Greenbrea, California 94904 Account Name: REALBID, LLC Account Number: Basic Business Checking Branch Plan 0224-352427 Authorized Access: Manager REALBID Emmett DeMoss Manager REALBID Robert Potter SECTION 3.34 Valuation of Comps ------------------ None. SECTION 3.35 Full Disclosure --------------- None. REALBID LLC BALANCE SHEET As of December 31, 1997
ASSETS Current Assets Checking/Savings Wells Fargo 9.66 Wells Fargo Checking 1,584.51 Total Checking/Savings 1,594.17 Total Current Assets 1,594.17 Other Assets Organization Costs 3,687.28 Total Other Assets 3,678.28 TOTAL ASSETS 5,272.45 ----------- LIABILITIES & EQUITY Liabilities Current Liabilities Accounts Payable Accounts Payable -750.00 Total Accounts Payable -750.00 Other Current Liabilities BAP Lease 12,881.97 ERD Lease 20,000.00 LLC Managers Accrued Fee 150,000.00 Total Other Current Liabilities 182,901.97 Total Current Liabilities 182,151.97 Total Liabilities 182,151.97 Equity Net Income -176,879.52 Total Equity -176,879.52 TOTAL LIABILITIES & EQUITY 5,272.45 -----------
REALBID LLC BALANCE SHEET As of October 31, 1998
ASSETS Current Assets Checking/Savings Wells Fargo Checking 7,481.24 Total Checking/Savings 7,481.24 Accounts Receivable Accounts Receivable 67,000.00 Total Accounts Receivable 67,000.00 Total Current Assets 74,481.24 Other Assets Organization Costs 3,687.28 Total Other Assets 3,678.28 TOTAL ASSETS 78,159.52 ----------- LIABILITIES & EQUITY Liabilities Current Liabilities Accounts Payable Accounts Payable 1,050.98 Total Accounts Payable 1,050.98 Other Current Liabilities BAP Lease 18,776.79 ERD Lease 26,875.02 LLC Managers Accrued Fee 324,000.00 Total Other Current Liabilities 369,651.81 Total Current Liabilities 370,702.79 Total Liabilities 370,702.79 Equity Retained Earnings -176,879.52 Net Income -115,663.75 Total Equity -292,543.27 TOTAL LIABILITIES & EQUITY 78,159.52 -----------
REALBID LLC PROFIT AND LOSS June through December 1997 Ordinary Income/Expenses Income Marketing Service Fee 15,500.00 Total Income 15,500.00 Gross Profit 15,500.00 Expenses Bank Service Charges 46.00 LLC Managers Fee 150,000.00 Professional Fees Legal Fees 24,859.14 Total Professional Fees 24,859.14 Rent 7,881.97 Uncategorized Expenses 0.00 Web Site Hosting & Maintenance 9,615.00 Total Expense 192,402.11 Net Ordinary Income -176,902.11 Other Income/Expense Other Income Interest Earned 0.22 Total Other Income 0.22 Net Other Income 0.22 Net Income -176,901.89 -----------
REALBID LLC PROFIT AND LOSS January through October, 1998 Ordinary Income/Expenses Income Marketing Service Fee 223,166.00 Total Income 223,166.00 Cost of Goods Sold Cost of Goods Sold 20,910.00 Total COGS 20,910.00 Gross Profit 202,256.00 Expenses Bank Service Charges 108.01 Data Base Modifications 705.00 Direct Property Service Cost Broadcasting Expenses 4,518.25 Posting Expense 8,605.00 Total Direct Property Service Cost 13,123.25 ____ and Subscriptions 500.00 Leased Equipment - Computers 2,360.30 Licenses and Permits 10.00 LLC Managers Fee 250,000.00 Office Expense 16.36 Professional Fees Accounting 900.00 Legal Fees 3,553.16 Total Professional Fees 4,453.16 Promotions 1,345.00 Rent 28,279.97 Taxes State 800.00 Total Taxes 800.00 Telephone 400.57 Travel & Ent. 7,568.14 Uncategorized Expenses 0.00 Web Site Hosting & Maintenance 8,250.00 Total Expense 317,919.76 Net Ordinary Income -115,663.76 Other Income/Expense Other Income Interest Earned 0.01 Total Other Income 0.01 Net Other Income 0.01 Net Income -115,663.75 -----------
Attachment 3.11 (7) - a The attached sheet reflects the outstanding account receivables as of October 31, 998 for REALBID. The following comments pertain to these receivables: Generally, all work assignments into by REALBID are by oral contracts. Upon completion of an assignment (Generally when information about a subject property is "broadcast" to specific categories of REALBIDS data base.) an invoice is issued to the client. In the normal course of business the invoice is for a fixed amount and due upon receipt. Industry practice however is payment within 30 60 days. Upon certain occasions REALBID will deviate from its normal practice of billing in order to obtain a new client, experiment with a new category of property, encourage greater volume from an existing client, etc. The notes below relate to those invoices that were created by a deviation from REALBIDS normal billing policy (See the attached A/R Aging Detail report with identifying numbers corresponding to the footnotes below.) 1. Staubach Retail Investments: This is a new client. REALBID offered him to be the judge as to whether to pay based upon our value added. Upon recent inquiry he said he liked the service would use it again and was continuing to market the property; consequently the amount and timing of the payment is uncertain. 2. Stephen N. Frankel Real Estate: REALBID proceeded with this transaction based upon the client paying $500 upon completion of the broadcast and $2,500 upon the "closing" of the property. The $500 has been paid. There has not been a "closing". Consequently the timing is uncertain. 3. Prudent Realty Advisors: Prudential inadvertently paid us twice for the same assignment. They instructed us to hold the money and give them a credit on the next assignment. 4. Grubb & Ellis (Florence Business Park): The terms for this transaction were $1,250 upon broadcast and $1,250 upon close. The broker is optimistic about a close, the timing of which is uncertain. 5. CBRichard Ellis (John Hancock Portfolio): The terms of this transaction were $1,750 upon the broadcast and an additional $1,750 upon the close of the property. The initial payment has been made and the broker is optimistic about the sale of the property the timing of which is uncertain. 6. Manekin Brokerage: The terms for this transaction were $4,000 upon closing. The closing has occurred, payment has been made (subsequent to October 31st .) and the cash is in the bank. 7. Boeing: The terms of this transaction are $2,500 upon the close of the portfolio. The portfolio just fell out of escrow, consequently the timing of payment is uncertain. REALBID LLC A/R Aging Detail As of October 31, 1998
Type Date Num P.O.# Name Terms Due Date Class Current Invoice 10/7/98 108 *** Net 30 11/6/98 Brokers Invoice 10/12/98 109 *** Net 30 11/11/98 Brokers Invoice 10/12/98 110 *** Net 30 11/11/98 Brokers Invoice 10/30/98 113 *** Net 30 11/29/98 Brokers Total Current 1 - 30 Invoice 9/1/98 71 *** Net 30 10/1/98 Realty Advis.... Invoice 9/3/98 72 *** Net 30 10/3/98 Brokers Invoice 10/7/98 107 *** 10/7/98 Life Insuranc... Invoice 9/18/98 74 *** Net 30 10/8/98 Brokers Payment 10/9/98 *** Invoice 9/15/98 77 *** Net 30 10/15/98 Brokers Invoice 9/15/98 78 *** Net 30 10/15/98 Brokers Invoice 9/15/98 80 *** Net 30 10/15/98 Builders/Dev.... Invoice 9/15/98 81 *** Net 30 10/15/98 Realty Advis.... Invoice 9/15/98 84 *** Net 30 10/15/98 Brokers Invoice 9/23/98 95 *** Net 30 10/23/98 Realty Advis.... Invoice 9/29/98 102 *** Net 30 10/29/98 Brokers Invoice 10/30/98 114 *** 10/30/98 Brokers Invoice 10/30/98 115 *** 10/30/98 Total 1 - 30 31 - 60 Invoice 8/18/98 65 *** Net 30 9/17/98 Realty Advis.... Invoice 9/23/98 94 *** 9/23/98 Brokers Invoice 9/23/98 96 *** 9/23/98 Brokers Invoice 9/23/98 98 *** 9/23/98 Corporation Invoice 8/27/98 69 *** Net 30 9/26/98 Brokers Invoice 8/28/98 67 *** Net 30 9/27/98 Brokers Invoice 9/28/98 101 *** 9/28/98 Life Insuranc... Total 31 - 60 61 - 90 Invoice 7/20/98 55 *** Net 30 8/19/98 Brokers Total 61 - 90 greater than 90 Invoice 4/24/98 24 *** 4/26/98 Realty Advis.... Invoice 5/14/98 33 *** Net 30 6/13/98 Brokers Invoice 5/27/98 38 *** Net 30 6/26/98 Realty Advis.... Invoice 5/27/98 39 *** Net 30 6/26/98 Broker Total greater than 90 TOTAL Type Aging Open Balance Current Invoice 2,500.00 Invoice 2,500.00 Invoice 2,500.00 Invoice 2,500.00 ------------ Total Current 10,000.00 1 - 30 Invoice 30 3,000.00 (1) Invoice 28 2,500.00 Invoice 24 2,500.00 Invoice 23 2,500.00 (2) Payment -1,000.00 (3) Invoice 16 500.00 Invoice 16 500.00 Invoice 16 2,500.00 Invoice 16 2,500.00 Invoice 16 2,500.00 (4) Invoice 8 2,500.00 Invoice 2 2,500.00 Invoice 1 2,500.00 Invoice 1 2,500.00 ------------ Total 1 - 30 28,000.00 31 - 60 Invoice 44 2,500.00 Invoice 38 2,500.00 Invoice 38 1,500.00 Invoice 38 2,000.00 (7) Invoice 35 750.00 Invoice 34 5,000.00 Invoice 33 2,500.00 ------------ Total 31 - 60 16,750.00 61 - 90 Invoice 73 1,750.00 (5) ------------ Total 61 - 90 1,750.00 greater than 90 Invoice 190 1,500.00 Invoice 140 4,000.00 (6) Invoice 123 2,500.00 Invoice 123 2,500.00 ------------ Total greater than 90 10,500.00 TOTAL 67,800.00
*** Portions of this page have been omitted pursuant to a request for Confidential Treatment and filed separately with the Commission. Attachment 3.24(c) REALBID is a disposition marketing tool that can help quickly identify, contact, inform and capture potential investors and help organize competitive, efficient and orderly sales by leveraging current communication technology. Here is how it works. First we develop a Web site specifically for the property using your executive summary. This will usually include property information, maps, site plans, pictures, summary financials, broker contact information and confidentiality agreement. For complete Posting Instructions please click here. Current ---- examples can be viewed at the Bid Center. ---------- We then identify and match investors with that property using REALBID's Buyer ----- Profile database. The investors whose profiles are in REALBID's database - ------- transacted over $50 billion last year. It includes the specific investment criteria of the pension fund managers, REITs, opportunistic funds, private investors and insurance companies. (Go to Buyer Profile to include or update ------------- your investment objectives in the database.) A broadcast announcement is then sent to matched investors by email, fax or phone. The announcement briefly describes the disposition, identifies the broker and invites investors to view property and market information, execute the confidentiality agreement and register online or to contact the broker directly. You control exposure and access by choosing one of three increasingly restrictive broadcast protocols. All questions, registrations and responses are directed to the broker for processing. REALBID automates and accelerates the disposition process and provides an extra level of assurance that you are achieving highest price and the most efficient execution. REALBID does not: . Participate in commissions, . Act as a broker, . Negotiate with potential investors nor . Independently prepare any sales documentation The standard price for a REALBID posting and broadcasting is $3,500 per property. On average that represents less than 3 basis points. Significant price breaks are offered for contracts that involve multiple transactions. CONTACT INFORMATION: Please contact us directly via any of the following: Email: Bob Potter ---------- Telephone: (415) 464-4916 Fax: (415) 464-4944 Address: 700 Larkspur Landing Circle, Suite #199, Larkspur, CA 94939 EX-10.45 48 ASSET PURCHASE AGMT DATED 12/4/98 Exhibit 10.45 - -------------------------------------------------------------------------------- ASSET PURCHASE AGREEMENT by and among COMPS INFOSYSTEMS, INC., AOBR, INC., LINDA HOFFMAN, GUY GOODWIN and DON GUY dated as of December 4, 1998 - -------------------------------------------------------------------------------- *** Certain confidential portions of this Exhibit were omitted by means of blackout of the text (the "Mark"). This Exhibit has been filed separately with the Secretary of the Commission without the Mark pursuant to the Company's Application Requesting Confidential Treatment under Rule 406 under the Act. TABLE OF CONTENTS -----------------
Page ---- ARTICLE 1 DEFINITIONS........................................................... 1 1.1 Defined Terms....................................................... 1 1.2 Construction of Certain Terms and Phrases........................... 5 ARTICLE 2 PURCHASE AND SALE OF PURCHASED ASSETS................................. 6 2.1 Purchase and Sale of the Company's Assets........................... 6 2.2 Excluded Assets..................................................... 6 2.3 Assumed Liabilities................................................. 7 2.4 Purchase Price...................................................... 7 2.5 Allocation of Aggregate Purchase Price.............................. 7 2.6 Sales, Use and Other Taxes.......................................... 7 2.7 Title............................................................... 7 2.8 Bulk Sales Compliance............................................... 8 2.9 Closing............................................................. 8 ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF SELLERS............................. 10 3.1 Organization and Ownership of the Company........................... 10 3.2 Authority of Sellers and the Company Principals..................... 10 3.3 Ownership of the Business/Purchased Assets.......................... 10 3.4 The Report Agreement................................................ 11 3.5 No Conflicts........................................................ 11 3.6 Governmental Approvals and Filings.................................. 11 3.7 Books and Records................................................... 12 3.8 Financial Statements................................................ 12 3.9 Absence of Changes.................................................. 12 3.10 No Undisclosed Liabilities.......................................... 12 3.11 Purchased Assets.................................................... 12 3.12 Intellectual Property Rights........................................ 13 3.13 Litigation.......................................................... 13 3.14 Compliance with Law................................................. 14 3.15 Tax Matters......................................................... 14 3.16 No Other Agreements to Sell the Business or the Purchased Assets.... 14 3.17 Exclusive Dealing................................................... 14 3.18 [Intentionally Left Blank].......................................... 15 3.19 Customers........................................................... 15 3.20 Third Party Consents................................................ 15 3.21 Brokers............................................................. 15 3.22 Disclosure.......................................................... 15 ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF BUYER............................... 16 4.1 Organization of Buyer............................................... 16 4.2 Authority of Buyer.................................................. 16
i 4.3 Litigation.......................................................... 16 4.4 Governmental Approvals and Filings.................................. 16 4.5 No Undisclosed Liabilities.......................................... 16 4.6 Brokers............................................................. 17 4.7 Third Party Consents................................................ 17 ARTICLE 5 CONDITIONS TO THE OBLIGATIONS OF SELLERS.............................. 17 5.1 Representations, Warranties and Covenants........................... 17 5.2 No Actions or Proceedings........................................... 17 5.3 Consents............................................................ 17 5.4 Performance of Agreement............................................ 18 5.5 Approval of Documentation........................................... 18 5.6 Closing Deliveries.................................................. 18 ARTICLE 6 CONDITIONS TO THE OBLIGATIONS OF BUYER................................ 18 6.1 Representations, Warranties and Covenants........................... 18 6.2 No Actions or Proceedings........................................... 18 6.3 Due Diligence....................................................... 18 6.4 Material Adverse Effect............................................. 18 6.5 Consents............................................................ 19 6.6 Board Approval...................................................... 19 6.7 Company Board and Shareholder Approval.............................. 19 6.8 Performance of Agreement............................................ 19 6.9 Approval of Documentation........................................... 19 6.10 Possible Infringement Claims........................................ 19 6.11 Closing Deliveries.................................................. 19 ARTICLE 7 COVENANTS OF THE PARTIES.............................................. 19 7.1 Covenants by Sellers and Buyer...................................... 19 7.2 Covenants of Sellers................................................ 21 7.3 Covenant of Buyer................................................... 23 ARTICLE 8 ACTIONS BY THE PARTIES AFTER THE CLOSING.............................. 23 8.1 Survival of Representations, Warranties, Etc........................ 23 8.2 Indemnification..................................................... 23 ARTICLE 9 MISCELLANEOUS......................................................... 26 9.1 Termination......................................................... 26 9.2 Notices............................................................. 26 9.3 Entire Agreement.................................................... 27 9.4 Waiver.............................................................. 28 9.5 Amendment........................................................... 28 9.6 No Third Party Beneficiary.......................................... 28 9.7 No Assignment; Binding Effect....................................... 28 9.8 Headings............................................................ 28 9.9 Severability........................................................ 28 9.10 Governing Law....................................................... 29
ii 9.11 Arbitration and Venue............................................... 29 9.12 Expense............................................................. 29 9.13 Construction........................................................ 29 9.14 Counterparts........................................................ 29
iii ASSET PURCHASE AGREEMENT This Asset Purchase Agreement (this "AGREEMENT") is made and entered into as of December 4, 1998 (the "Effective Date"), by and among Comps InfoSystems, Inc., a Delaware corporation ("Buyer"), AOBR, Inc., a Texas corporation (the "Company"), Linda Hoffman, an individual ("Hoffman, and together with AOBR, "Sellers"), Guy Goodwin, an individual ("Goodwin"), and Don Guy, an individual ("Guy," and together with Goodwin, the "Company Principals). RECITALS -------- WHEREAS, pursuant to that certain Agreement of Purchase and Sale dated March 24, 1998, by and between Hoffman and Jones and Jones Enterprises, Inc. ("Jones and Jones") (the "Jones Agreement"), Hoffman acquired from Jones and Jones all of Jones and Jones' right, title and interest in the Business (as defined below) free and clear of all Encumbrances (as defined below), which interest equaled fifty percent (50%) of the Business; WHEREAS, Hoffman owned one hundred percent (100%) of the Business free and clear of all Encumbrances after her purchase of Jones and Jones' interest in the Business; WHEREAS, pursuant to that certain Agreement Between Linda Hoffman and AOBR, Inc., dated March 23, 1998 (the "Report Agreement"), AOBR acquired from Hoffman fifty percent (50%) of Hoffman's right, title and interest in the Business free and clear of all Encumbrances; WHEREAS, Sellers desire to sell to Buyer and the Company Principals desire to cause Sellers to sell to Buyer, and Buyer desires to purchase from Sellers the assets, properties and rights of Sellers to the Business as set forth in Section 2.1; and ----------- WHEREAS, Buyer, Sellers and the Company Principals desire to make certain representations, warranties, covenants and agreements in connection with such purchase and sale. NOW, THEREFORE, in consideration of the premises and the mutual covenants and promises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the parties agree as follows: ARTICLE 1 DEFINITIONS ----------- 1.1 DEFINED TERMS. As used in this Agreement, the following defined terms ------------- have the meanings indicated below: "ACTIONS OR PROCEEDINGS" means any action, suit, proceeding, arbitration, Order (as defined below), inquiry, hearing, assessment with respect to fines or penalties or litigation (whether civil, criminal, administrative, investigative or informal) commenced, brought, 1 conducted or heard by or before, or otherwise involving, any Governmental or Regulatory Authority (as defined below). "ADVERSE CONSEQUENCE" means all actions, suits, proceedings, hearings, investigations, charges, complaints, claims, demands, Orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid in settlements, liabilities, obligations, taxes, liens, losses, expenses, and fees, including court costs and reasonable attorneys' fees and expenses. "AFFILIATE" means, with respect to any Person (as defined below), another Person that directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such Person. "ASSETS AND PROPERTIES" and "ASSETS OR PROPERTIES" of any Person each means all assets and properties of every kind, nature, character and description (whether real, personal or mixed, whether tangible or intangible, whether absolute, accrued, contingent, fixed or otherwise and wherever situated), including the goodwill related thereto, operated, owned or leased by such Person, including, without limitation, documents, instruments, general intangibles, real estate, equipment, inventory, goods and Intellectual Property. "BEST KNOWLEDGE OF SELLERS OR THE COMPANY PRINCIPALS" or "BEST KNOWN TO SELLERS OR THE COMPANY PRINCIPALS" means the knowledge of Hoffman, Goodwin, Guy, the Company or any officer or director of the Company, in each case after reasonable due inquiry and reasonable comprehensive investigation. "BOOKS AND RECORDS" of any Person means all files, documents, instruments, papers, books and records relating to the business, operations or condition of such Person. "BUSINESS" means the Hoffman Valuation Data Services, which services consists of obtaining sales information on real estate transactions, documentation for the same (in electronic form and hard copy form) and the sale of such information to the public in the form of any reports created, published and distributed related to the Hoffman Valuation Data Services (the "Report") and any other format (whether in electronic form or hard copy form), the creation, publication and distribution of such information in the Report and in any other format (whether in electronic form or hard copy form), and the assets of the Business that Buyer is licensing to the Company pursuant to the License Agreement required by Section 2.9; provided, however, Business shall not include ----------- -------- ------- any assets owned by the Company or the Company Principals and not listed in Section 2.1 below. - ----------- "BUSINESS DAY" means a day other than Saturday, Sunday or any day on which banks located in the State of California are authorized or obligated to close. "CLOSING DATE" means January 7, 1999. "CODE" means the Internal Revenue Code of 1986, as amended. "COMPANY INTELLECTUAL PROPERTY" means any Intellectual Property relating, directly or indirectly, to the Business or the Purchased Assets that is owned by or held by or on behalf of the Company and/or Hoffman, or exclusively licensed to, the Company or Hoffman, 2 including without limitation all of the Company Trademarks, all proprietary techniques, procedures and routines developed to facilitate the monthly publication of the Report or any other publications using the information contained in the historical database of the Business; provided, however, that -------- ------- Company Intellectual Property will not include (i) any software used to operate the databases of the Business and (ii) any Intellectual Property owned by the Company or the Company Principals that is not listed in Section 2.1. ----------- "COMPANY TRADEMARKS" means Sellers' rights to the names "Hoffman Valuation Data Services," and the "Hoffman Report" and all variations thereof, provided the word "Hoffman" is included therein, and all trademarks, trade names, service marks and goodwill associated therewith (excluding "AOBR" or the "Austin Office Building Report"). "CONFIDENTIAL INFORMATION" means all of the following (whether or not reduced to writing and whether or not patentable or protected by copyright): (i) any and all trade secrets concerning the business and affairs of a Person, product specifications, data, know-how, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, past, current and planned research and development, current and planned manufacturing and distribution methods and processes, customer lists, current and anticipated customer requirements, price lists, market studies, business plans, computer software and programs (including object code and source code), computer software and database technologies, systems, structures and architectures (and related processes, formulae, compositions, improvements, derivatives, devices, know-how, inventions, discoveries, concepts, ideas, designs, methods and information) of a Person and any other information, however, documented, of a Person that is a trade secret within the meaning of any and all applicable state and federal trade secret laws; (ii) any and all information concerning the business and affairs of a Person (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel and personnel training and techniques and materials), however documented; and (iii) any and all notes, analysis, compilations, studies, summaries, and other material prepared by or for a Person containing or based, in whole or in part, on any information included in the foregoing. "DISCLOSURE SCHEDULE" means the disclosure schedule attached hereto which sets forth the exceptions to the representations and warranties contained in Article 3 hereof and certain other information called for by this Agreement. --------- "ENCUMBRANCE" means any mortgage, pledge, assessment, security interest, deed of trust, lease, lien, adverse claim, levy, charge or other encumbrance of any kind, or any conditional sale or title retention agreement or other agreement to give any of the foregoing in the future. "FINANCIAL STATEMENTS" means the balance sheets, related statements of income and retained earnings and the general ledger of the Company related to the Business for the period from June 15, 1998 to November 15, 1998. "GOVERNMENTAL OR REGULATORY AUTHORITY" means any court, tribunal, arbitrator, authority, agency, commission, official or other instrumentality of the United States or other country, any state, county, city or other political subdivision. 3 "INTELLECTUAL PROPERTY" means any or all of the following and all rights in, arising out of, or associated therewith: (i) all United States, international and foreign patents and applications therefor and all reissues, divisions, renewals, extensions, provisionals, continuations and continuations- in-part thereof; (ii) registered trademarks, applications to register trademarks, intent-to-use applications, or other registrations or applications related to trademarks; (iii) registered copyrights and applications for copyright registration; (iv) any other Intellectual Property that is the subject of an application, certificate, filing, registration or other document issued, filed with, or recorded by any Governmental or Regulatory Authority (items (i) through (iv) shall also be referred to hereinafter as the "Registered Intellectual Property"); (v) any and all trade secrets concerning the business and affairs of a Person, product specifications, data, know-how, formulae, compositions, processes, designs, sketches, photographs, graphs, drawings, samples, inventions and ideas, past, current and planned research and development, current and planned manufacturing and distribution methods and processes, customer lists, current and anticipated customer requirements, price lists, market studies, business plans, computer software and programs (including object code and source code), computer software and database technologies, systems, structures and architectures (and related processes, formulae, compositions, improvements, devices, know-how, inventions, discoveries, concepts, ideas, designs, methods and information) of a Person and any other information, however, documented, of a Person that is a trade secret within the meaning of any and all applicable state and federal trade secret laws; (vi) any and all information concerning the business and affairs of a Person (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel and personnel training and techniques and materials), however documented; (vii) any and all notes, analysis, compilations, studies, summaries, and other material prepared by or for a Person containing or based, in whole or in part, on any information included in the foregoing; (viii) all industrial designs and any registrations and applications therefor throughout the world; (ix) all databases and data collections and all rights therein throughout the world; and (x) any similar or equivalent rights to any of the foregoing anywhere in the world. "LIABILITIES" means any liability (whether known or unknown, whether asserted, or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including but not limited to any liability for Taxes. "MATERIAL ADVERSE EFFECT" means, for any Person, a material adverse effect whether individually or in the aggregate (i) on the business, operations, financial condition, Assets and Properties, Liabilities or prospects of such Person, or (ii) on the ability of such Person to consummate the transactions contemplated hereby. "ORDER" means any writ, judgment, decree, injunction or similar order of any Governmental or Regulatory Authority (in each such case whether preliminary or final). "ORDINARY COURSE OF BUSINESS" means the action of a Person (as defined below) that is consistent with the past practices of such Person and is taken in the ordinary course of the normal day-to-day operations of such Person. 4 "PERMITS" means all licenses, permits, certificates of authority, authorizations, approvals, registrations and similar consents granted or issued by any Governmental or Regulatory Authority. "PERMITTED ENCUMBRANCE" means (i) any Encumbrance for taxes not yet due or delinquent or being contested in good faith by appropriate proceedings for which adequate reserves have been established and (ii) any minor imperfection of title or similar Encumbrance which individually or in the aggregate with other such Encumbrances does not impair the value of the property subject to such Encumbrance or the use of such property in the conduct of the Business. "PERSON" means any natural person, corporation, general partnership, limited partnership, limited liability company, proprietorship, other business organization, trust, union, association or Governmental or Regulatory Authority. "TAX" (and, with correlative meaning, "Taxes," "Taxable" and "Taxing") means (i) any federal, state, local or foreign income, alternative or add-on minimum tax, gross income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property, environmental or windfall profit tax, custom, duty or other tax, governmental fee or other like assessment or charge of any kind whatsoever, together with any interest or any penalty, addition to tax or additional amount imposed by any Governmental or Regulatory Authority responsible for the imposition of any such tax (domestic or foreign), (ii) any Liability for payment of any amounts of the type described in (i) as a result of being a member of an affiliated, consolidated, combined, unitary or other group for any Taxable period and (iii) any Liability for the payment of any amounts of the type described in (i) or (ii) as a result of any express or implied obligation to indemnify any other person. "TAX RETURN" means any return, report, information return, schedule or other document (including any related or supporting information) filed or required to be filed with respect to any taxing authority with respect to Taxes. 1.2 CONSTRUCTION OF CERTAIN TERMS AND PHRASES. Unless the context of this ----------------------------------------- Agreement otherwise requires, (a) words of any gender include each other gender; (b) words using the singular or plural number also include the plural or singular number, respectively; (c) the terms "hereof," "herein," "hereby" and derivative or similar words refer to this entire Agreement; (d) the terms "Article" or "Section" refer to the specified Article or Section of this Agreement; (e) the term "or" has, except where otherwise indicated, the inclusive meaning represented by the phrase "and/or"; and (f) the term "including" means "including without limitation." Whenever this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified. All accounting terms used herein and not expressly defined herein shall have the meanings given to them under GAAP. 5 ARTICLE 2 PURCHASE AND SALE OF PURCHASED ASSETS ------------------------------------- 2.1 PURCHASE AND SALE OF THE COMPANY'S ASSETS. Subject to the terms and ----------------------------------------- conditions of this Agreement, at the Closing, Sellers agree to grant, sell, convey, assign, transfer and deliver to Buyer, and Buyer agrees to purchase and acquire from Sellers, free and clear of any Encumbrance or adverse claim of any kind whatsoever, all of Sellers' right, title, and interest in and to the assets, properties, rights, contracts and interests of Sellers, wherever located, that are used in or pertain to the Business, as set forth below (collectively, the "Purchased Assets"): (a) the historical database of the Business, in electronic and hard copy form, including, without limitation, the Report, plat maps, photographs, and sales comparable data, owned or licensed by the Company and used in the Business; (b) all former, current and prospective customer lists, mailing lists, telephone numbers, correspondence, vendor lists, list of billings and receivables for former and current customer accounts of the Company related to the Business set forth in Schedule 2.1(b) attached hereto (the "Business --------------- Customer Lists"); (c) all the Books and Records of the Company relating to the Business, including without limitation, operating data, the data collection methodology, sales and other literatures, files and documents relating to the Business (the "Business Records"); (d) all right, title and interest in and to all of the Company Intellectual Property, including, without limitation, (i) all of the Company's rights to the Company Trademarks; and (ii) the Company Intellectual Property set forth on Schedule 2.1(d) attached hereto and all improvements, modifications and --------------- other Intellectual Property derived therefrom; (e) all licenses, permits, consents, approvals, orders, certificates, authorizations, declarations and filings held by the Company, including the fictitious business name statement or other similar document, if any, filed with the Texas Secretary of State for the name "Hoffman Valuation Data Services," necessary or incidental to the conduct of the Business as set forth in Schedule 2.1(e) attached hereto (the "Business Permits"); and -------------- (f) the goodwill and going concern value of the Business. 2.2 EXCLUDED ASSETS. Notwithstanding Section 2.1 hereof, the Purchased --------------- ----------- Assets do not include the assets set forth on Schedule 2.2 attached hereto (the ------------ "Excluded Assets"). 2.3 ASSUMED LIABILITIES. Buyer agrees to assume, satisfy and perform when ------------------- due only those liabilities arising from the liabilities and obligations of the Business under the Purchased Assets which arise in the Ordinary Course of Business on or after the Closing Date (the "Assumed Liabilities"). Other than the Assumed Liabilities, Buyer is not required to, and shall not assume, pay, perform, defend, discharge or guarantee or be deemed to have assumed, paid, performed, defended or discharged or guaranteed, or otherwise be responsible for any Liability, obligation or claim of any nature of the Company or the Business, including all payment obligations and any other obligations under the Report Agreement, whether matured or 6 unmatured, liquidated or unliquidated, fixed or contingent, known or unknown, or whether arising out of acts or occurrences prior to, at or after the date hereof. Without limiting the generality of the foregoing, Sellers shall remain liable for the payment of all Liabilities, obligations or claims to personnel employed by the Company (the "Company Employees") with respect to the notice and continuation coverage requirement of Section 4980B(e) of the Code and regulations thereunder for all Company Employees whose employment is terminated for whatever reason prior to the Closing, for all the Company Employees who terminated employment prior to the Closing, payroll, overtime, accrued vacation time, holiday time, severance arrangements or worker's compensation of any nature which are accrued but unpaid as of the Closing Date or which accrued as a result of the consummation of the transactions contemplated herein. 2.4 PURCHASE PRICE. At the Closing, as consideration for the Purchased -------------- Assets, Buyer agrees to pay, or cause to be paid, an aggregate purchase price in cash of One Hundred Twenty Thousand Dollars ($120,000) (the "Purchase Price") as follows: (a) to AOBR, Sixty Thousand Six Hundred Twenty-Five Dollars ($60,625); and (b) to Hoffman, Fifty-Nine Thousand Three Hundred Seventy-Five Dollars ($59,375). 2.5 ALLOCATION OF AGGREGATE PURCHASE PRICE. The Purchase Price shall be -------------------------------------- allocated among the Purchased Assets as set forth on Schedule 2.5 attached ------------ hereto which allocation shall be in compliance with Section 1060 of the Internal Revenue Code and Regulations. Buyer and Sellers agree (i) to report the sale of the Purchased Assets for federal and state Tax purposes in accordance with the allocations set forth on Schedule 2.5 hereto and (ii) not to take any position ------------ inconsistent with such allocations on any of their respective tax returns. 2.6 SALES, USE AND OTHER TAXES. Sellers shall be responsible for all -------------------------- sales and use taxes, if any, arising out of the sale of the Purchased Assets to Buyer pursuant to this Agreement. 2.7 TITLE. Title to the Purchased Assets shall pass to Buyer at the ----- Closing and the Purchased Assets shall be at the risk of the Sellers prior to the Closing. 2.8 BULK SALES COMPLIANCE. Buyer hereby waives compliance by Sellers with --------------------- the provisions of the bulk transfer laws of any state. Sellers and the Company Principals warrant and agree to pay and discharge when due all claims of creditors which could be asserted against Buyer by reason of such noncompliance. Sellers and the Company Principals shall indemnify and hold Buyer harmless from, against and in respect of (and shall on demand reimburse Buyer for) any Damages suffered or incurred by Buyer by reason of the failure of Sellers to pay or discharge such claims. 2.9 CLOSING. ------- (a) TIME AND PLACE. The consummation of the purchase and sale of the -------------- Purchased Assets under this Agreement (the "Closing") shall take place by facsimile (with original signed documents to be delivered by overnight courier) at 10:00 a.m. on the Closing Date, or at such time and in such manner as the parties mutually agree. 7 (b) CLOSING DELIVERIES BY BUYER. Buyer shall have delivered or caused --------------------------- to be delivered to Sellers: (i) the Purchase Price to Sellers by wire transfer in immediately available funds to the accounts designated by Sellers; (ii) a certificate of an officer of Buyer substantially in the form of Exhibit A attached hereto to evidence compliance with Section 5.1 --------- ----------- hereof; (iii) an Assignment and Assumption Agreement by and among Buyer and Sellers substantially in the form of Exhibit B attached hereto (the --------- "General Assignment"), duly executed by Buyer as of the Closing Date; (iv) a License Agreement by and between Buyer and the Company for the licensing by Buyer to the Company of certain Purchased Assets necessary for the AOBR operations of the Company, substantially in the form of Exhibit C to be attached hereto (the "License --------- Agreement"), duly executed by Buyer; (v) an Independent Contractor Agreement by and between Buyer and Hoffman for the transition of the Purchased Assets from the Company to Buyer (the "Independent Contractor Agreement"), which Independent Contractor Agreement shall be executed by Buyer and Hoffman by no later than December 15, 1998; (vi) (1) certified copies of the Certificate of Incorporation and Bylaws of COMPS and (2) certificate of good standing for COMPS issued by the appropriate governmental office of its state of incorporation and each state in which it is qualified to do business; (vii) such other documents as Sellers may reasonably request for the purpose of facilitating the consummation of the transactions contemplated herein. (c) CLOSING DELIVERIES BY SELLERS. Sellers and the Company Principals ----------------------------- shall have delivered or caused to be delivered to Buyer: (i) possession of all of the Purchased Assets, together will all files, Books and Records relating to the Purchased Assets; (ii) Bill of Sale substantially in the form of Exhibit D attached hereto, --------- conveying good and marketable title in all of the Purchased Assets duly executed by Sellers; (iii) the General Assignment, duly executed by Sellers; (iv) the Non-Competition Agreements by and between Buyer and the Company, Hoffman and each Company Principal substantially in the form of Exhibit E attached hereto (the "Non-Competition Agreements"), duly --------- 8 executed by the Company, Hoffman and each Company Principal, respectively, as of the Closing Date (the "Non-Competition Agreements"); (v) an Intellectual Property Assignment of all of the Company Intellectual Property by and among Buyer and Sellers substantially in the form of Exhibit F attached hereto (the "Intellectual Property --------- Assignment"), duly executed by Buyer; (vi) the Independent Contractor Agreement, duly executed by the Hoffman and Buyer by no later than December 15, 1998; (vii) the License Agreement, duly executed by the Company; (viii) a certificate of an officer of the Company, Hoffman and each Company Principal substantially in the form of Exhibit G attached hereto to evidence compliance with Section 6.1 hereof; and (ix) (1) certified copies of the Articles of Incorporation and Bylaws of AOBR and (2) certificate(s) of good standing for AOBR issued by the appropriate governmental office of its state of incorporation and each state in which it is qualified to do business; (x) such other documents as Buyer may reasonably request for the purpose of facilitating the consummation of the transactions contemplated herein. ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF SELLERS ----------------------------------------- Each of the Company, Hoffman and the Company Principals, jointly and severally, represent and warrant to Buyer as of the date hereof and as of the Closing, except as set forth in the Disclosure Schedule furnished to Buyer, specifically identifying the relevant Section hereof, which exceptions shall be deemed to be representations and warranties as if made in this Article 3 (provided that the disclosure in such exceptions shall be true, complete and correct), as follows: 3.1 ORGANIZATION AND OWNERSHIP OF THE COMPANY. The Company is a ----------------------------------------- corporation duly organized, validly existing, and in good standing under the laws of the State of Texas. The Company is duly authorized to conduct business and is in good standing in each jurisdiction where such qualification is required except for any jurisdiction where failure so to qualify would not have a Material Adverse Effect upon the Company. Sellers have full power and authority, and holds all Permits and authorizations necessary to carry on the Business and to own and use the Assets and Properties owned and used by it except where the failure to have such power and authority or to hold such Permit or authorization would not have a Material Adverse Effect on the Company, the Business or the Purchased Assets. Section 3.1(a) of the Disclosure Schedule -------------- lists the officers and directors of the Company. The Company has delivered to Buyer correct and complete copies of its Articles of Incorporation, bylaws, each as amended to date. 9 (b) The Company Principals are the sole shareholders of the Company. All of the Company's issued and outstanding capital stock have been issued only to the Company Principals and are duly authorized, validly issued, fully paid and non-assessable, and issued in accordance with all federal and state securities laws. 3.2 AUTHORITY OF SELLERS AND THE COMPANY PRINCIPALS. Each Seller and ----------------------------------------------- Company Principal has all necessary power and authority and has taken all actions necessary to own, lease and operate its Assets and Properties and the Business as currently conducted and to enter into this Agreement, to consummate the transactions contemplated hereby and to perform its obligations hereunder, and no other proceedings on the part of Sellers or the Company Principals are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by each Seller and each Company Principal and constitutes a legal, valid and binding obligation of each Seller and each Company Principal enforceable against each Seller and each Company Principal in accordance with its terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors' rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies. 3.3 OWNERSHIP OF THE BUSINESS/PURCHASED ASSETS. Hoffman and the Company ------------------------------------------ each own a fifty percent (50%) interest in the Business and the Purchased Assets free and clear of all Encumbrances. Entry into this Agreement and the Consummation of the transactions contemplated hereby will not impair Sellers ownership of the Business and the Purchased Assets prior to the Closing Date or Buyer's ownership of the Business and the Purchased Assets after the Closing Date. Except for COMPS, no Person has, or will have as a result of Sellers entry into this Agreement or the consummation of the transactions contemplated hereby, any rights to the Business or the Purchased Assets. 3.4 THE REPORT AGREEMENT. All payment obligations and any other -------------------- obligations under the Report Agreement will terminate upon the Effective Date of this Agreement. 3.5 NO CONFLICTS. The execution and delivery by Sellers of this Agreement ------------ does not, and the performance by Sellers of their respective obligations under this Agreement and the consummation of the transactions contemplated hereby will not (with or without the lapse of time): (a) conflict with or result in a violation or breach of any of the terms, conditions or provisions of the charter documents, other organizational documents or other documents, of the Company; (b) conflict with or result in a violation or breach of any term or provision of any law, Order, license, statute, rule or regulation applicable to any Seller or the Business or the Purchased Assets; (c) result in a breach of, or default under (or give rise to a right of termination, cancellation or acceleration under) any of the terms, conditions or provisions of any note, bond, mortgage, indenture, license, agreement, lease or other similar instrument or obligation to which 10 any of the Purchased Assets may be bound, except for such breaches or defaults as set forth in the Disclosure Schedule as to which requisite waivers or consents will have been obtained by Sellers by the Closing Date; (d) conflict with or result in a breach of the Report Agreement or the Jones Agreement; or (e) result in an imposition of any Encumbrance on the Business or the Purchased Assets. 3.6 GOVERNMENTAL APPROVALS AND FILINGS. No consent, approval or action ---------------------------------- of, filing with or notice to any or Regulatory Authority, or any other Person or entity, on the part of any Seller is required in connection with the execution, delivery and performance of this Agreement or the consummation of the transactions contemplated hereby. 3.7 BOOKS AND RECORDS. The Business Records and all other Books and ----------------- Records of the Company as made available by Sellers to Buyer are true, correct and complete. 3.8 FINANCIAL STATEMENTS. Sellers have previously delivered to Buyer the -------------------- Financial Statements. The Financial Statements (i) are true, correct and complete, (ii) are in accordance with the Business Records, (iii) to the Best Knowledge of Sellers or the Company Principals, have been prepared in a manner that is not materially different from GAAP, and (iv) fairly present the financial condition and results of operations of the Company as of the respective dates thereof and for the periods covered thereby. 3.9 ABSENCE OF CHANGES. Since the date of the Letter of Intent by and ------------------ between Buyer and the Company (the "LOI Date"), and up to the Closing Date, Sellers have conducted the Business only in the Ordinary Course of Business and there has not been any adverse change in, or any event or development which, individually or together with other such events, could reasonably be expected to result in a Material Adverse Effect on the Business or any of the Purchased Assets. Without limiting the generality of the foregoing, no event as described below has occurred since the LOI Date: (a) The Company has not sold, leased, transferred or assigned any of the Purchased Assets, tangible or intangible. (b) The Company has not entered into any agreement, contract, lease or license (or series of related agreements, contracts, leases and licenses) involving the Business or the Purchased Assets other than in the Ordinary Course of Business and as described in Section 3.9(b) of the Disclosure Schedule. (c) The Company has not granted any Encumbrance of any kind upon any of the Purchased Assets, tangible or intangible. (d) The Company has not granted any license or sublicense of any rights under or with respect to any Company Intellectual Property. 11 3.10 NO UNDISCLOSED LIABILITIES. Except as disclosed in the Financial -------------------------- Statements, there are no Liabilities or claims, nor any basis for any Liabilities or claims against, relating to or affecting the Business or the Purchased Assets, other than Liabilities incurred in the Ordinary Course of Business which have not had, and could not be expected to result, individually or in the aggregate, in a Material Adverse Effect on the Business or the Purchased Assets. 3.11 PURCHASED ASSETS. Section 3.11 of the Disclosure Schedule contains a ---------------- ------------ complete and accurate schedule specifying the location of all of the Purchased Assets, where applicable, as of the Closing Date. The Company has good and marketable title to, or a valid leasehold interest in all of the Purchased Assets to be delivered to Buyer by Sellers, free and clear of all Encumbrances. The Purchased Assets being transferred to Buyer pursuant to this Agreement include all the Intellectual Property necessary for the ownership and operation of the Business. 3.12 INTELLECTUAL PROPERTY RIGHTS. ---------------------------- (a) Schedule 2.1(d) lists (i) the federal registration number and --------------- the date of registration of patents, trademarks and of other marks, trade names, brand names or other trade rights currently used by Sellers, including the Company Trademarks, in the conduct of the Business, (ii) all of the copyrights and all federal applications, if any, for any of the foregoing, (iii) all other Company Intellectual Property rights (including the Company Trademarks) and (iv) all Intellectual Property rights owned by any third party which are not generally commercially available and are currently used by Sellers in the conduct of the Business and whether such use is or will be pursuant to license, sublicense, agreement or permission. (b) Sellers have delivered to Buyer complete and accurate copies of each agreement, registration and other documents relating to the Company Intellectual Property set forth in the Disclosure Schedule. (c) Sellers own or possess adequate and enforceable licenses or other rights to use (a) all of the Company Intellectual Property rights and (b) all other patents, trademarks, service marks, brand names and tradenames, all applications for any of the foregoing, all other trade secrets, designs, plans, specifications and other Intellectual Property rights of every kind that are used in, possessed by or necessary for the conduct of the Business by it. Entry into this Agreement and consummation of the transactions contemplated hereby will not impair Seller's ownership or use of the Company Intellectual Property. No Person has a right to receive a royalty or similar payment in respect of any item of Company Intellectual Property pursuant to any contractual arrangements entered into by the Company. Sellers have not granted any license, sublicense or other similar agreement relating in whole or in part to any Company Intellectual Property. No Seller has received any notice that the Company's or Hoffman's or any third party's use of any item of Intellectual Property is interfering with, infringing upon or otherwise violating the rights of the Company, Hoffman or any third party in or to such Intellectual Property, and no proceedings have been instituted against or notices received by any Seller alleging that use or proposed use of any item of the Intellectual Property by the Company, Hoffman or any third party infringes upon or otherwise violates any rights of the Company, Hoffman or a third party in or to such Intellectual Property. 12 3.13 LITIGATION. There are no Actions or Proceedings pending or, to the ---------- Best Knowledge of Sellers or the Company Principals, threatened or anticipated against, relating to or affecting (i) either Seller, the Purchased Assets or the Business or (ii) the transactions contemplated by this Agreement, and there is no basis for any such Action or Proceeding. Since the inception of the Report and the Business (regardless of who owned or operated the Report or the Business), there have been no Actions or Proceedings against, relating to or affecting the Report, the Purchased Assets or the Business. No Seller is in default with respect to any Order relating to the Company, Hoffman, the Business or the Purchased Assets, and there are no unsatisfied judgments against any Seller, the Business or the Purchased Assets. 3.14 COMPLIANCE WITH LAW. Sellers and the Company Principals are in ------------------- compliance with all applicable laws, statutes, Orders, ordinances and regulations, whether federal, state, local or foreign, except where the failure to comply, in each instance and in the aggregate, would not be expected to result in a Material Adverse Effect on the Business or the Purchased Assets. Neither Sellers nor the Company Principals have not received any written notice to the effect that, or otherwise have been advised that, any of them are not in compliance with any of such laws, statutes, Orders, ordinances or regulations, where the failure to comply would be expected to result in a Material Adverse Effect on the Business or the Purchased Assets. 3.15 TAX MATTERS. All Taxes, including, without limitation, income, ----------- property, sales, use, franchise, value added, employees, income withholding, social security and other employee-related taxes, imposed by the United States, by any state, municipality, other local government or other subdivision or instrumentality of the United States, or by any foreign country or any state or other government thereof, or by any other taxing authority, that are due and payable by the Company or Hoffman and all interest and penalties thereon, whether disputed or not, and which would result in the imposition of an Encumbrance on the Purchased Assets, the Company, Hoffman or against Buyer, other than Taxes which are not yet due and payable, have been paid in full or contested in appropriate proceedings. All Tax Returns required to be filed in connection therewith have been accurately prepared and duly and timely filed and all deposits required by law to be made by the Company or Hoffman with respect to the Company Employees' withholding or other taxes have been duly made. Sellers are not delinquent in the payment of any tax, assessment or governmental charge or deposits which would result in the imposition of an Encumbrance on the Company, Hoffman or the Purchased Assets or against Buyer, and the Company and Hoffman have no tax, deficiency or claim outstanding, proposed or assessed against it, and there is no basis for any such deficiency or claim, which would result in the imposition of any Encumbrances on the Company, Hoffman, the Business, the Purchased Assets or against Buyer. 3.16 NO OTHER AGREEMENTS TO SELL THE BUSINESS OR THE PURCHASED ASSETS. ---------------------------------------------------------------- Neither the Company nor the Company Principals nor any affiliate or representative of the Company has any obligation, absolute or contingent, to any other person or firm to sell or encumber the Business, the Purchased Assets or to effect any sale, consolidation or other reorganization of the Business or to enter into any agreement with respect thereto, nor has any such party had any discussion with any third party regarding any of the foregoing. 3.17 EXCLUSIVE DEALING. Sellers and the Company Principals represent and ----------------- warrant that they are not entertaining any bids, inquiries or other offers toward a transaction with any 13 other entity that would affect the ownership of the Business or the Purchased Assets, and that they will continue not to do and will not orally or in writing agree to any such transaction until this Agreement has been terminated. Any such offers or indications of interest received by Sellers or the Company Principals will be promptly disclosed to Buyer. 3.18 [INTENTIONALLY LEFT BLANK]. -------------------------- 3.19 CUSTOMERS. --------- (a) The Company has previously provided to Buyer a true and correct list of the Business' customers during the 1997 fiscal year and for the eleven-month period ended November 15, 1998. Except as set forth in Section ------- 3.19 of the Disclosure Schedule, since November 13, 1998, no single customer or - ---- group of affiliated customers contributing more than $250 per month to the gross revenues of the Business has stopped doing business with the Company or Hoffman, and to the Best Knowledge of Sellers and the Company Principals, no such customer has an intention to discontinue doing business or reduce the level of gross revenues from that in fiscal year 1997 with the Company or Hoffman. (b) The Company has delivered to Buyer all of the billings/invoices for the services of Business charged to the customers of the Business for the period between April 1, 1998 and November 13, 1998 (the "Billings"). The Billings are (i) true, correct and complete, (ii) in accordance with the Business Records and (iii) fairly present billing information and related operations of the Business. 3.20 THIRD PARTY CONSENTS. No consent, approval or authorization of any third party on the part of any Seller or Company Principal is required in connection with the consummation of the transactions contemplated hereunder except as otherwise provided in Section 3.20 of the Disclosure Schedule. ------------ 3.21 BROKERS. No Seller or Company Principal has retained any broker in ------- connection with the transactions contemplated hereunder. Buyer does not have any nor will have any obligation to pay any broker's, finder's, investment banker's, financial advisor's or similar fee in connection with this Agreement or the transactions contemplated hereby by reason of any action taken by or on behalf of any Seller or Company Principal. 3.22 DISCLOSURE. The representations and warranties by Sellers and the ---------- Company Principals in this Agreement and the statements contained in the Disclosure Schedule, the other schedules, certificates, exhibits and other writings furnished and to be furnished by Sellers or Company Principals to Buyer pursuant to this Agreement do not and will not contain any untrue statement of material fact and do not and will not omit to state any material fact necessary to make the statements herein or therein not misleading. ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF BUYER --------------------------------------- Buyer represents and warrants to Sellers, as of the date hereof and as of the Closing, as follows: 14 4.1 ORGANIZATION OF BUYER. Buyer is a corporation duly organized, validly --------------------- existing, and in good standing under the laws of the State of Delaware. Buyer is duly authorized to conduct business and is in good standing under the laws of each jurisdiction where such qualification is required except for any jurisdiction where failure so to qualify would not have a Material Adverse Effect upon Buyer. Buyer has full power and authority, and holds all Permits and authorizations necessary, to carry on the business in which it is engaged and to own and use the properties owned and used by it except where the failure to have such power and authority or to hold such license, permit or authorization would not have a Material Adverse Effect on Buyer. 4.2 AUTHORITY OF BUYER. Buyer has all necessary corporate power and ------------------ corporate authority and has taken all corporate actions necessary to enter into this Agreement, to consummate the transactions contemplated hereby and to perform its obligations hereunder and no other proceedings on the part of Buyer are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by Buyer and constitutes a legal, valid and binding obligation of Buyer enforceable against Buyer in accordance with its terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors' rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies. 4.3 LITIGATION. There are no Actions or Proceedings pending, or to the ---------- knowledge of Buyer, threatened or anticipated against, relating to or affecting Buyer's ability to consummate the transactions contemplated by this Agreement and perform any of its obligations under this Agreement, and to the knowledge of Buyer, there is no basis for any such Action or Proceedings. Buyer is not in default with respect to any Order, and there are no unsatisfied judgments against Buyer. 4.4 GOVERNMENTAL APPROVALS AND FILINGS. No consent, approval or action ---------------------------------- of, filing with or notice to any Governmental or Regulatory Authority on the part of Buyer is required in connection with the execution, delivery and performance of this Agreement or the consummation of the transactions contemplated hereby. 4.5 NO UNDISCLOSED LIABILITIES. There are no Liabilities or claims, nor -------------------------- any basis for any material Liabilities or claims against Buyer, its officers or directors, other than Liabilities incurred in the Ordinary Course of Business which have not had, and, to the knowledge of Buyer, could not be expected to result, individually or in the aggregate, in an Adverse Effect on Buyer. 4.6 BROKERS. Buyer has not retained any broker in connection with the ------- transactions contemplated hereunder. Sellers have no and will have no obligation to pay any broker's, finder's, investment banker's, financial advisor's or similar fee in connection with this Agreement or the transactions contemplated hereby by reason of any action taken by or on behalf of Buyer. 4.7 THIRD PARTY CONSENTS. No consent, approval or authorization of any -------------------- third party on the part of Buyer is required in connection with the consummation of the transactions contemplated hereunder. 15 ARTICLE 5 CONDITIONS TO THE OBLIGATIONS OF SELLERS ---------------------------------------- The obligations of Sellers to effect the transactions contemplated hereby are subject to the satisfaction, at or before the Closing, of each of the following conditions: 5.1 REPRESENTATIONS, WARRANTIES AND COVENANTS. All representations and ----------------------------------------- warranties of Buyer contained in this Agreement shall be true and correct on and as of the Closing Date and Buyer shall have performed all agreements and covenants required to be performed by them prior to or on the Closing Date. 5.2 NO ACTIONS OR PROCEEDINGS. No Actions or Proceedings shall have been ------------------------- instituted or threatened which question the validity or legality of the transactions contemplated hereby. 5.3 CONSENTS. All Permits, authorizations, consents, approvals and -------- waivers from third parties and Governmental or Regulatory Authorities and other Persons necessary or appropriate to permit Buyer to perform its obligations hereunder and to consummate the transactions contemplated hereby shall have been obtained. 5.4 PERFORMANCE OF AGREEMENT. All covenants, conditions and other ------------------------ obligations under this Agreement which are to be performed or complied with by Buyer shall have been fully performed and complied with, or waived by Sellers at or prior to the Closing. 5.5 APPROVAL OF DOCUMENTATION. The form and substance of all ------------------------- certificates, instruments, exhibits, schedules and other documents delivered to or to be delivered to Sellers under this Agreement shall be reasonably satisfactory to Sellers and their counsel. 5.6 CLOSING DELIVERIES. Buyer shall have executed and delivered the ------------------ documents required to be executed and delivered by Buyer pursuant to Section ------- 2.9(b) above. - ------ ARTICLE 6 CONDITIONS TO THE OBLIGATIONS OF BUYER -------------------------------------- The obligation of Buyer to effect the transactions contemplated hereby is subject to the satisfaction, at or before the Closing, of each of the following conditions: 6.1 REPRESENTATIONS, WARRANTIES AND COVENANTS. All representations and ----------------------------------------- warranties of Sellers and the Company Principals contained in this Agreement shall be true and correct on and as of the Closing Date and Sellers and the Company Principals shall have performed all agreements and covenants required to be performed by them prior to or on the Closing Date. 6.2 NO ACTIONS OR PROCEEDINGS. No Actions or Proceedings shall have been ------------------------- instituted or threatened which question the validity or legality of the transactions contemplated hereby. 16 6.3 DUE DILIGENCE. The results of an investigation of the Company, the ------------- Business and the Purchased Assets by Buyer, its counsel and other advisors shall have been received and completed by Buyer. 6.4 MATERIAL ADVERSE EFFECT. Sellers and the Company Principals shall not ----------------------- have acted or caused any Person to have acted in any manner which has created or could reasonably create any Material Adverse Effect on the Company, Hoffman, the Business or the Purchased Assets, nor shall there be any event or development which, individually or together with other such events, could reasonably be expected to result in an Material Adverse Effect on the Company, Hoffman, the Business or the Purchased Assets. 6.5 CONSENTS. All Permits, authorizations, consents, approvals and -------- waivers from third parties (including without limitation required consents set forth on Section 3.20 of the Disclosure Schedule) and Governmental or Regulatory Authorities and other Persons necessary or appropriate to permit Sellers to perform their obligations hereunder and to consummate the transactions contemplated hereby shall have been obtained. 6.6 BOARD APPROVAL. Buyer shall have received the approval of this -------------- Agreement and the terms and conditions herein by its Board of Directors. 6.7 COMPANY BOARD AND SHAREHOLDER APPROVAL. The Company shall have -------------------------------------- received the approval of this Agreement and the terms and conditions herein by its Board of Directors and a majority of its shareholders. 6.8 PERFORMANCE OF AGREEMENT. All covenants, conditions and other ------------------------ obligations under this Agreement which are to be performed or complied with by Sellers shall have been fully performed and complied with at or prior to the Closing. 6.9 APPROVAL OF DOCUMENTATION. The form and substance of all ------------------------- certificates, instruments, exhibits, schedules and other documents delivered to or to be delivered to Buyer under this Agreement shall be reasonably satisfactory to Buyer and its counsel. 6.10 POSSIBLE INFRINGEMENT CLAIMS. All matters which, in the discretion ---------------------------- of Buyer, may result in a litigation matter related to the Business or the Purchased Assets shall have been resolved in a manner satisfactory to Buyer. 6.11 CLOSING DELIVERIES. Sellers shall have executed and delivered the ------------------ documents required to be executed and delivered by Sellers pursuant to Section ------- 2.9(c) above. - ------ ARTICLE 7 COVENANTS OF THE PARTIES ------------------------ 7.1 COVENANTS BY SELLERS AND BUYER. Prior to the Closing Date, Sellers ------------------------------ and Buyer covenant to act as follows: (a) NOTIFICATION OF CERTAIN MATTERS. Each of the parties shall ------------------------------- give prompt notice to the other party, of (i) the discovery of a fact or facts of which the notifying party has actual 17 knowledge which cause any of the representations, warranties or statements made by it or him or in an any exhibit, schedule or other document delivered pursuant to this Agreement, to be false or misleading or omit any facts necessary in order to make such representations, warranties or statements not false or misleading; (ii) the occurrence, or failure to occur, of any event which occurrence or failure would be likely to cause any representation or warranty made by them in this Agreement to be untrue or inaccurate any time from the date of this Agreement to the Closing Date; and (iii) any failure of the notifying party to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it or him hereunder. Each party hereto shall use all reasonable efforts to remedy any failure on its or his part to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it or him/her hereunder. During the period from the date of this Agreement to the Closing Date, Sellers will promptly notify Buyer of any material change in, or outside of, the Ordinary Course of Business of the Company, the Business or the Purchased Assets and of any Governmental or Regulatory Authority complaints, investigative hearings, or the institution, threat (to the extent Sellers has or should have Knowledge of such threat) or settlement of litigation, in each case involving an amount in excess of $5,000 and relating to the Company, the Business or the Purchased Assets, and shall keep Buyer fully informed in reasonable detail of such events. Sellers shall not enter into any settlements over $5,000 in connection with any such litigation without the prior written consent of Buyer. (b) REASONABLE COMMERCIAL EFFORTS. Subject to the terms and ----------------------------- conditions of this Agreement, each of the parties hereto will use its reasonable commercial efforts to take, or cause to be taken, all action, or to do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations to consummate and make effective the transactions contemplated by this Agreement, including, without limitation, obtaining all consents and approvals of all Persons and Governmental or Regulatory Authorities and removing any injunctions or other impairments or delays or otherwise which are necessary to the consummation of the transactions contemplated by this Agreement. (c) CONFIDENTIALITY. --------------- (i) Except as and to the extent required by law, the parties hereto will not disclose or use, and will direct their respective representatives not to disclose or use to the detriment of the other parties, any Confidential Information with respect to such other party furnished, or to be furnished, by such other party or its representatives to the disclosing party or its representatives at any time or in any manner other than in connection with the transaction contemplated in this Agreement. Notwithstanding the foregoing, Confidential Information shall not include any information which is generally known to the public or to companies in businesses similar to the Business, or which later, through no act of the disclosing party, becomes generally known. (ii) Upon consummation of this Agreement, Sellers shall (a) return to Buyer, or shall destroy in a manner satisfactory to Buyer, all tangible forms of such Confidential Information, including any and all copies thereof, and those portions of any documents, memoranda, notes, studies and analyses 18 prepared by or on behalf of Sellers or any of its directors, officers, employees, advisors or representatives that incorporate or are derived from such Confidential Information, and (b) immediately cease, and shall cause its directors, officers, employees, partners, advisors and representatives to cease, use of such Confidential Information as well as any information or materials that incorporate or are derived from such Confidential Information. (iii) In the event this Agreement is terminated prior to the consummation of the transaction contemplated hereunder, the party receiving any such Confidential Information shall (a) return to the party disclosing the same, or shall destroy in a manner satisfactory to such disclosing party, all tangible forms of such Confidential Information, including any and all copies thereof, and those portions of any documents, memoranda, notes, studies and analyses prepared by or on behalf of the receiving party or any of its directors, officers, employees, advisors or representatives that incorporate or are derived from such Confidential Information, and (b) immediately cease, and shall cause its directors, officers, employees, partners, advisors and representatives to cease, use of such Confidential Information as well as any information or materials that incorporate or are derived from such Confidential Information. (d) PUBLIC ANNOUNCEMENTS. Sellers, the Company Principals and Buyer -------------------- shall not issue any press release or make any public announcement with respect to this Agreement and the transactions contemplated hereby without obtaining the prior consent of the other parties, except as may be required by applicable law upon the advice of counsel, and any such press release issued by Sellers, the Company Principals or Buyer shall not disclose any information regarding the terms or the Purchase Price of the transactions contemplated by this Agreement. 7.2 COVENANTS OF SELLERS. Prior to the Closing Date, Sellers covenant to -------------------- act as follows: (a) MAINTENANCE OF BUSINESS PRIOR TO CLOSING. Except as otherwise ---------------------------------------- contemplated by this Agreement, during the period from the Effective Date to the Closing Date, Sellers have conducted and will continue to conduct the Business in accordance with its Ordinary Course of Business and seek to preserve its current relationships with the customers and other persons with whom it has business relations to the extent consistent with its Ordinary Course of Business. Without limiting the generality of the foregoing and, except as otherwise expressly provided in this Agreement, prior to the Closing Date, without the prior written consent of Buyer, Sellers will not, and the Company Principals will cause Sellers not to, with respect to the Business and the Purchased Assets: (i) (A) sell, transfer or otherwise dispose of, or agree to sell, transfer or otherwise dispose of the Business or any Purchased Assets or (B) permit any Encumbrance on the Business or any Purchased Assets; (ii) make any changes to the accounting methods, principles or practices applicable to the Company; 19 (iii) permit any damage, destruction or casualty loss, whether covered by insurance or not, material to the Business taken as a whole, or to any Purchased Assets; (iv) take or omit to take any action in violation or contravention of any provision of Section 3.9 above or any other representation or ----------- warranty hereunder; (v) agree, whether in writing or orally, whether formally or informally, to engage in any of the actions described in clauses ------- (i) through (iv) of this Section 7.2(a). --- ---- -------------- (b) INVESTIGATION BY BUYER. Sellers shall allow Buyer, at its ---------------------- own expense during regular business hours, or otherwise with the consent of Sellers (which consent shall not be unreasonably withheld), to make such inspection of the Company and the Business and to inspect (and, if applicable, make copies of) Books and Records, offices and other facilities of the Company as requested by Buyer and reasonably necessary for or reasonably related to the operation of the Business, including historical financial information, concerning the Business; provided, however, that any information obtained from -------- ------- the Sellers is subject to the obligations imposed by Section 7.1(c) above. -------------- (c) CONSENTS. As soon as practicable, Sellers will commence all -------- reasonable action required hereunder to obtain all applicable Permits, consents, approvals and agreements of, and to give all notices and make all filings with, any third parties as may be necessary to authorize, approve or permit the full and complete consummation of the transactions contemplated hereby by the Closing Date. (d) TRANSITION PERIOD. From the Effective Date until all of the ----------------- Purchased Assets are transferred to Buyer in a manner satisfactory to Buyer (the "Transfer Period"), Sellers and the Company Principals shall use their best efforts to completely transfer the Purchased Assets to Buyer, including without limitation facilitating the transfer of customers to Buyer, the development of press releases or any other actions the Buyer deems necessary, so that Buyer shall have full use of the Purchased Assets in the same manner and to the same extent that the Company used the Purchased Assets on the Effective Date. Notwithstanding the foregoing, all costs, expenses and revenues arising from the Purchased Assets during the period from the Effective Date to the Closing Date shall belong to the Company. (e) CESSATION OF USE OF THE COMPANY TRADEMARKS AND PURCHASED -------------------------------------------------------- ASSETS. On the Closing Date, Sellers and the Company Principals shall cease - ------ using (i) the Company Trademarks and any variations thereof in any capacity and (ii) subject to the terms of the License Agreement, all Purchased Assets including without limitation all databases for the Business, and will assign to Buyer all rights in and to the Company Trademarks and the Purchased Assets. 7.3 COVENANT OF BUYER. As soon as practicable after the Effective Date ----------------- and prior to the Closing Date, Buyer covenants to act as follows: Buyer will commence all reasonable action required hereunder to obtain all applicable Permits, consents, approvals and agreements of, and to give all notices and make all filings with, any third parties as may be necessary to authorize, 20 approve or permit the full and complete consummation of the transactions contemplated hereby by the Closing Date. ARTICLE 8 ACTIONS BY THE PARTIES AFTER THE CLOSING ---------------------------------------- 8.1 SURVIVAL OF REPRESENTATIONS, WARRANTIES, ETC. The representations, -------------------------------------------- warranties and covenants contained in or made pursuant to this Agreement or any certificate, document or instrument delivered pursuant to or in connection with this Agreement in the transactions contemplated hereby shall survive the execution and delivery of this Agreement and the Closing hereunder notwithstanding any investigation, analysis or evaluation by Buyer or its designees of the Purchased Assets, Business, operations or condition (financial or otherwise) of the Company and the Purchased Assets and thereafter the representations and warranties of Sellers shall continue to survive in full force and effect for a period of two (2) years after the Closing Date. 8.2 INDEMNIFICATION. --------------- (a) BY HOFFMAN AND COMPANY PRINCIPALS. Subject to the --------------------------------- limitations set forth in Section 8.2(d) below, Hoffman and the Company -------------- Principals shall jointly and severally, indemnify, defend and hold harmless Buyer, and its officers, directors, employees, agents, successors and assigns (collectively the "BUYER GROUP") from and against any and all costs, losses (including, without limitation, diminution in value), Liabilities, damages, lawsuits, deficiencies, claims and expenses, including without limitation, interest, penalties, costs of mitigation, lost profits and other losses resulting from any shutdown or curtailment of operations, attorneys' fees and all amounts paid in investigation, defense or settlement of any of the foregoing (collectively, the "DAMAGES"), incurred in connection with, arising out of, resulting from or incident to (i) any breach of any covenant, representation, warranty or agreement or the inaccuracy of any representation, made by Sellers in or pursuant to this Agreement, (ii) Actions or Proceedings set forth in the Disclosure Schedule or (iii) any Liabilities of Sellers which relates to the Business and arises out of transactions entered into or events occurring prior to the Closing; however, such indemnification shall exclude any loss in revenue due to any customers of the Business prior to the Closing Date not remaining customers of the Business after the Closing Date. (b) BY BUYER. Buyer shall indemnify, defend and hold harmless -------- Sellers and the Company's officers, employees, agents, successors and assigns from and against any and all costs, losses (including, without limitation, diminution in value), Liabilities, damages, lawsuits, deficiencies, claims and expenses, including without limitation, interest, penalties, costs of mitigation, lost profits and other losses resulting from any shutdown or curtailment of operations, attorneys' fees and all amounts paid in investigation, defense or settlement of any of the foregoing, incurred in connection with, arising out of, resulting from or incident to any breach of any covenant, representation, warranty or agreement or the inaccuracy of any representation, made by Buyer in or pursuant to this Agreement. (c) DEFENSE OF CLAIMS. If any Action or Proceeding is filed or initiated against any party entitled to the benefit of indemnity hereunder, written notice thereof shall be given to 21 the indemnifying party as promptly as practicable (and in any event within ten (10) days after the service of the citation or summons); provided, however, that -------- ------- the failure of any indemnified party to give timely notice shall not affect rights to indemnification hereunder except to the extent that the indemnifying party demonstrates actual damage caused by such failure. After such notice, if the indemnifying party shall acknowledge in writing to the indemnified party that the indemnifying party shall be obligated under the terms of its indemnity hereunder in connection with such Action or Proceeding, then the indemnifying party shall be entitled, if it so elects, to take control of the defense and investigation of such Action or Proceeding and to employ and engage attorneys of its own choice to handle and defend the same, such attorneys to be reasonably satisfactory to the indemnified party, at the indemnifying party's cost, risk and expense (unless (i) the indemnifying party has failed to assume the defense of such Action or Proceeding or (ii) the named parties to such Action or Proceeding include both of the indemnifying party and the indemnified party, and the indemnified party and its counsel determine in good faith that there may be one or more legal defenses available to such indemnified party that are different from or additional to those available to the indemnifying party and that joint representation would be inappropriate), and to compromise or settle such Action or Proceeding, which compromise or settlement shall be made only with the written consent of the indemnified party, such consent not to be unreasonably withheld. The indemnified party may withhold such consent if such compromise or settlement would adversely affect the conduct of business or requires less than an unconditional release to be obtained. If (i) the indemnifying party fails to assume the defense of such Action or Proceeding within fifteen (15) days after receipt of notice thereof pursuant to this Section 8.2, or (ii) the named parties to such Action or Proceeding include both - ----------- the indemnifying party and the indemnified party and the indemnified party and its counsel determine in good faith that there may be one or more legal defenses available to such indemnified party that are different from or additional to those available to the indemnifying party and that joint representation would be inappropriate, the indemnified party against which such Action or Proceeding has been filed or initiated will (upon delivering notice to such effect to the indemnifying party) have the right to undertake, at the indemnifying party's cost and expense, the defense, compromise or settlement of such Action or Proceeding on behalf of and for the account and risk of the indemnifying party; provided, however, that such Action or Proceeding shall not be compromised or - -------- ------- settled without the written consent of the indemnifying party, which consent shall not be unreasonably withheld. In the event the indemnified party assumes defense of the Action or Proceeding, the indemnified party will keep the indemnifying party reasonably informed of the progress of any such defense, compromise or settlement and will consult with, when appropriate, and consider any reasonable advice from, the indemnifying party of any such defense, compromise or settlement. The indemnifying party shall be liable for any settlement of any action effected pursuant to and in accordance with this Section 8.2 and for any final judgment (subject to any right of appeal), and the - ----------- indemnifying party agrees to indemnify and hold harmless the indemnified party from and against any Damages by reason of such settlement or judgment. Subject to the limitations set forth in Section 8.2(d) below, -------------- regardless of whether the indemnifying party or the indemnified party takes up the defense, the indemnifying party will pay reasonable costs and expenses in connection with the defense, compromise or settlement for any Action or Proceeding under this Section 8.2. ----------- 22 The indemnified party shall cooperate in all reasonable respects with the indemnifying party and such attorneys in the investigation, trial and defense of such Action or Proceeding and any appeal arising therefrom; provided, -------- however, that the indemnified party may, at its own cost, participate in the - ------- investigation, trial and defense of such Action or Proceeding and any appeal arising therefrom. The indemnifying party shall pay all expenses due under this Section 8.2 as such expenses become due. In the event such expenses are not so - ----------- paid, the indemnified party shall be entitled to settle any Action or Proceeding under this Section 8.2 without the consent of the indemnifying party and without ----------- waiving any rights the indemnified party may have against the indemnifying party. (d) LIMITATION ON INDEMNIFICATION. ----------------------------- (i) Hoffman and the Company Principal shall not have liability for amounts payable to any member of the Buyer Group pursuant to her or its indemnification obligations in this Article 8 until --------- the total of all Damages of the Buyer exceeds Ten Thousand Dollars ($10,000) in the aggregate (the "Threshold Amount"), after which the indemnification obligations of Hoffman and the Company Principals shall include all such Damages as if this Section 8.2(d)(i) were not part of this Agreement. ----------------- (ii) Buyer shall not have liability for amounts payable to any Seller or Company Principal pursuant to its indemnification obligations in this Article 8 until the total of all Damages --------- of the Sellers and the Company Principals exceeds Ten Thousand Dollars ($10,000) in the aggregate (the "Threshold Amount"), after which the indemnification obligations of Buyer shall include all such Damages as if this Section 8.2(d)(i) were not ----------------- part of this Agreement. (iii) Hoffman and the Company Principal shall not have liability to any member of the Buyer Group pursuant to his or her indemnification obligations in this Article 8 to the extent --------- that the total of all Damages paid by Hoffman and the Company Principals in the aggregate to members of the Buyer Group pursuant to such indemnification obligations exceeds One Hundred Twenty Thousand Dollars ($120,000). Buyer shall not have liability to any Seller or Company Principal pursuant to its indemnification obligations in this Article 8 to the --------- extent that the total of all Damages paid by Buyer in the aggregate to Sellers and the Company Principals pursuant to such indemnification obligations exceeds One Hundred Twenty Thousand Dollars ($120,000). Hoffman shall not have liability to any member of the Buyer Group pursuant to her indemnification obligations in this Article 8 to the extent --------- the total of all Damages paid to members of the Buyer Group by Hoffman exceeds Sixty Thousand Dollars ($60,000), and each of the Company Principals shall not have liability to any member of the Buyer Group pursuant to such Company Principal's liability obligation in this Article 8 to the extent the total --------- of all damages paid to the member of the Buyer Group by such Company Principal exceeds Thirty Thousand Dollars ($30,000). Notwithstanding the foregoing, this clause (iii) shall ------------ 23 not apply to any intentional breach by any Seller or Company Principal of any representation, warranty, covenant or agreement of such Seller or Company Principal. ARTICLE 9 MISCELLANEOUS ------------- 9.1 TERMINATION. This Agreement may be terminated at any time prior to ----------- Closing: (a) by mutual consent of the parties hereto; (b) by Sellers, if (i) any condition precedent to Sellers' obligations hereunder is not satisfied and such condition is not waived by Sellers at or prior to the Closing Date or (ii) there has been a material violation or breach by Buyer of any covenant, agreement, representation or warranty contained in this Agreement and such violation or breach has not been waived in writing by Sellers; or (c) by Buyer if (i) any condition precedent to Buyer's obligations hereunder is not satisfied and such condition is not waived by Buyer at or prior to the Closing Date or (ii) there has been a material violation or breach by Sellers of any covenant, agreement, representation or warranty contained in this Agreement and such violation or breach has not been waived in writing by Buyer; (d) In the event that a condition precedent to its obligations is not satisfied, nothing contained herein shall be deemed to require any party to terminate this Agreement, rather than to waive such condition precedent and proceed with the Closing. (e) In the event of termination of this Agreement as provided in this Section 9.1, this Agreement shall forthwith become void and there shall be ----------- no liability or obligations on the part of Buyer or Sellers; provided, however, -------- ------- that (i) each party shall remain liable for any breaches of this Agreement prior to its termination and (ii) the provisions of Section 7.1(c) and Article 9 of -------------- --------- this Agreement shall remain in full force and effect and survive any termination of this Agreement. 9.2 NOTICES. All notices, requests and other communications hereunder ------- must be in writing and will be deemed to have been duly given only if delivered personally against written receipt or by facsimile transmission with answer back confirmation or mailed (postage prepaid by certified or registered mail, return receipt requested) or by overnight courier to the parties at the following addresses or facsimile numbers: IF TO SELLERS OR THE COMPANY PRINCIPALS: AOBR, Inc. 8303 North Mopac, Suite B-325 Austin, TX 78759 Facsimile No: (512) 346-4873 Attention: Linda Hoffman and Guy Goodwin 24 IF TO BUYER, TO: Comps InfoSystems, Inc. 9888 Carroll Centre Road, Suite 100 San Diego, CA 92126-4580 Facsimile No: (619) 684-3292 Attention: Christopher Crane with copies to: Brobeck, Phleger & Harrison LLP 550 West "C" Street Suite 1300 San Diego, CA 92101 Facsimile No.: (619) 234-1966 Attention: Craig S. Andrews, Esq. All such notices, requests and other communications will (i) if delivered personally to the address as provided in this Section 9.2, be deemed given upon ----------- delivery, (ii) if delivered by facsimile transmission to the facsimile number as provided in this Section 9.2, be deemed given upon receipt, and (iii) if ----------- delivered by mail in the manner described above to the address as provided in this Section 9.2, be deemed given upon receipt (in each case regardless of ----------- whether such notice, request or other communication is received by any other Person to whom a copy of such notice, request or other communication is to be delivered pursuant to this Section). Any party from time to time may change its address, facsimile number or other information for the purpose of notices to that party by giving notice specifying such change to the other parties hereto. 9.3 ENTIRE AGREEMENT. This Agreement (and all Exhibits and Schedules ---------------- attached hereto, all other documents delivered in connection herewith) supersedes all prior discussions and agreements among the parties with respect to the subject matter hereof and contains the sole and entire agreement among the parties hereto with respect thereto. 9.4 WAIVER. Any term or condition of this Agreement may be waived at any ------ time by the party that is entitled to the benefit thereof, but no such waiver shall be effective unless set forth in a written instrument duly executed by or on behalf of the party waiving such term or condition. No waiver by any party hereto of any term or condition of this Agreement, in any one or more instances, shall be deemed to be or construed as a waiver of the same or any other term or condition of this Agreement on any future occasion. All remedies, either under this Agreement or by law or otherwise afforded, will be cumulative and not alternative. 9.5 AMENDMENT. This Agreement may be amended, supplemented or modified --------- only by a written instrument duly executed by or on behalf of each party hereto. 9.6 NO THIRD PARTY BENEFICIARY. The terms and provisions of this -------------------------- Agreement are intended solely for the benefit of each party hereto and their respective successors or permitted assigns, and it is not the intention of the parties to confer third-party beneficiary rights upon any other Person other than any Person entitled to indemnity under Section 8.2. ----------- 25 9.7 NO ASSIGNMENT; BINDING EFFECT. Neither this Agreement nor any right, ----------------------------- interest or obligation hereunder may be assigned by any party hereto without the prior written consent of the other parties hereto and any attempt to do so will be void, except that any party's rights to indemnification under Article 8 may --------- be freely assigned. This Agreement is binding upon, inures to the benefit of and is enforceable by the parties hereto and their respective successors and assigns. 9.8 HEADINGS. The headings used in this Agreement have been inserted for -------- convenience of reference only and do not define or limit the provisions hereof. 9.9 SEVERABILITY. If any provision of this Agreement is held to be ------------ illegal, invalid or unenforceable under any present or future law, and if the rights or obligations of any party hereto under this Agreement will not be materially and adversely affected thereby, (a) such provision will be fully severable, (b) this Agreement will be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof, (c) the remaining provisions of this Agreement will remain in full force and effect and will not be affected by the illegal, invalid or unenforceable provision or by its severance herefrom and (d) in lieu of such illegal, invalid or unenforceable provision, there will be added automatically as a part of this Agreement a legal, valid and enforceable provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and mutually acceptable to the parties herein. 9.10 GOVERNING LAW. This Agreement shall be governed by and construed in ------------- accordance with the laws of the State of California applicable to contracts executed and performed in such State, without giving effect to conflicts of laws principles. 9.11 ARBITRATION AND VENUE. Any controversy or claim arising out of or --------------------- relating to this Agreement or the making, performance or interpretation thereof shall be submitted to arbitration in Travis County, Texas, pursuant to the rules and procedures of the American Arbitration Association before a panel of three arbitrators. The ruling of the arbitrator shall be final, and judgment thereon may be entered in any court having jurisdiction. If any question is submitted to a court of law for resolution, then the Superior Court of Travis County, Texas, or the United States District Court having jurisdiction in Travis County, Texas shall be the exclusive court of competent jurisdiction for the resolution of such question. Each party will bear one half of the cost of the arbitration filing and hearing fees, and the cost of the arbitrator. Each party will bear its own attorneys' fees, unless otherwise decided by the arbitrator. The parties understand and agree that the arbitration shall be instead of any civil litigation and that the arbitrator's decision shall be final and binding to the fullest extent permitted by law and enforceable by any court having jurisdiction thereof. Each party shall be entitled to pre-hearing discovery as provided in California Code of Civil Procedure Section 1283.05 9.12 EXPENSE. Except as otherwise provided in this Agreement, the Sellers ------- and Buyer shall pay the expenses and costs of Sellers and Buyer, respectively, incidental to the preparation of this Agreement and to the consummation of the transactions contemplated hereby. 9.13 CONSTRUCTION. No provision of this Agreement shall be construed in ------------ favor of or against any party on the ground that such party or its counsel drafted the provision. Any remedies provided for herein are not exclusive of any other lawful remedies which may be 26 available to either party. This Agreement shall at all times be construed so as to carry out the purposes stated herein. 9.14 COUNTERPARTS. This Agreement may be executed in any number of ------------ counterparts and by facsimile, each of which will be deemed an original, but all of which together will constitute one and the same instrument. [SIGNATURE PAGE TO FOLLOW] 27 IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the parties hereto as of the date first above written. "BUYER" COMPS INFOSYSTEMS, INC., a Delaware corporation By: /s/ Chris Fenton ----------------------------------------- Name: Chris Fenton --------------------------------------- Title: Vice President, Corporate Development -------------------------------------- "SELLERS" AOBR, INC., a Texas corporation By: /s/ Guy Goodwin ----------------------------------------- Name: Guy Goodwin --------------------------------------- Title: President -------------------------------------- /s/ Linda Hoffman --------------------------------------------- Linda Hoffman "COMPANY PRINCIPALS" /s/ Guy Goodwin --------------------------------------------- Guy Goodwin /s/ Don Guy --------------------------------------------- Don Guy 28 EXHIBIT A FORM OF COMPS OFFICER CERTIFICATE CERTIFICATE OF OFFICER COMPS INFOSYSTEMS, INC. This Certificate is delivered pursuant to Section 2.9(b)(ii) of that certain Asset Purchase Agreement (the "Agreement"), dated as of December 4, 1998, by and among COMPS InfoSystems, Inc., AOBR, Inc., Linda Hoffman, Guy Goodwin and Don Guy. Capitalized terms used herein without definition shall have the same meaning as set forth in the Agreement. I, Christopher A. Crane, do hereby certify that I am the duly elected, qualified and acting President of Buyer and as such, am authorized to execute this Certificate on its behalf, and I further certify that: 1. All representations and warranties of Buyer contained in the Agreement are true and correct on and as of the date hereof and Buyer has performed all agreements and covenants in a timely manner required to be performed by it prior to or on the date hereof. 2. No Actions or Proceedings have been instituted or threatened which question the validity or legality of the transactions contemplated by the Agreement. 3. All Permits, authorizations, consents, approvals and waivers from third parties and Governmental or Regulatory Authorities and other Persons necessary or appropriate to permit Buyer to perform its obligations hereunder and to consummate the transactions contemplated by the Agreement have been obtained. IN WITNESS WHEREOF, I have executed this Certificate as of the Closing Date, this ____ day of January, 1999. By: --------------------------------------- Christopher A. Crane President A-2 EXHIBIT B FORM OF GENERAL ASSIGNMENT ASSIGNMENT AND ASSUMPTION AGREEMENT This Assignment and Assumption Agreement ("Assignment") is entered into this ___ day of __________, 199__, by and among AOBR, Inc., a Texas corporation, Linda Hoffman, an individual, (collectively, "Assignors"), and COMPS InfoSystems, Inc., a Delaware corporation ("Assignee"). RECITALS -------- WHEREAS, Assignors and Assignee have entered into that certain Asset Purchase Agreement dated _____________, 1998 (the "Purchase Agreement") by and among Assignors Guy Goodwin, Don Guy and Assignee, for the sale by Assignors of the Purchased Assets (as defined in Section 2.1 of the Purchase Agreement) ----------- (initially capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Purchase Agreement); WHEREAS, the execution and delivery of this Agreement is a condition precedent to the closing of the Purchase Agreement; NOW, THEREFORE, in consideration of the mutual covenants and promises set forth herein, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows: 1. Assignment and Assumption. Assignors hereby agree that, ------------------------- effective as of the Closing, they shall grant, sell, convey, assign, transfer and deliver unto Assignee, and Assignee hereby agrees to accept and assume, free and clear of any Encumbrance or adverse claim of any kind whatsoever, all of Assignors' right, title and interest in and to all the Purchased Assets (as such assets are defined and described in the Purchase Agreement and the schedules relating thereto). Assignors hereby assigns, and Assignee hereby assumes and agrees to satisfy and perform when due those liabilities and obligations arising from the Assumed Liabilities on and after the Closing Date. 2. Assignors Covenant. Assignors hereby covenant that they will, at ------------------ any time and from time to time, upon written request therefor, execute and deliver to Assignee, its successors and assigns, any new or confirmatory instruments which may be reasonably necessary in order to protect or fully assign and transfer to and vest in Assignee, or its successors and assigns, all of Assignors' right, title and interest in and to the Purchased Assets. 3. Retained Liabilities. The parties acknowledge and agree that, -------------------- except for the Assumed Liabilities, Assignors shall retain and be responsible for all obligations, liabilities, and claims of any nature, accruing, arising out of, or relating to Assignors and the Company's business, whether actual or contingent, matured or unmatured, liquidated or unliquidated, or know or unknown (the "Retained Liabilities"). Pursuant to the terms of the Purchase Agreement, B-2 Assignors shall indemnify and hold Assignee harmless from, against and in respect to (and shall reimburse Assignee for) any loss, liability, cost or expenses, including, without limitation, reasonable attorneys' fees, suffered or incurred by Assignee by reason of or resulting from the Retained Liabilities. 4. Entire Agreement. This Assignment, together with the Purchase ---------------- Agreement and all documents executed in connection with the Purchase Agreement, constitutes the entire agreement and understanding between and among the parties hereto with respect to the matters set forth herein, and supersedes and replaces any prior agreements and understandings, whether oral or written, between and among them with respect to such matters. Notwithstanding any other provisions of this Assignment to the contrary, nothing contained in this Assignment shall in any way superseded, modify, replace, amend, change, rescind, waive, exceed, expand, enlarge or in any way affect the provisions, including warranties, covenants, agreements, conditions, representations, or in general any of the rights and remedies, and any of the obligations and indemnifications of Assignors or Assignee set forth in the Purchase Agreement nor shall this Assignment expand or enlarge any remedies under the Purchase Agreement including without limitation any limits on indemnification specified therein. This Assignment is intended only to effect the transfer of certain property transferred pursuant to the Purchase Agreement and shall be governed entirely in accordance with the terms and conditions of the Purchase Agreement. 5. Governing Law. This Assignment shall in all respects be ------------- construed in accordance with and governed by the laws of the State of California without giving effect to its conflicts-of-laws principles (other than any provisions thereof validating the choice of the laws of the State of California in the governing law). 6. Counterparts. This Agreement may be executed in any number of ------------ counter parts and by facsimile and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. [SIGNATURE PAGE TO FOLLOW] B-3 IN WITNESS WHEREOF, the parties have executed this Assignment as of the day and year first written above. COMPS InfoSystems, Inc., AOBR, INC. a Delaware corporation a Texas corporation By: By: ------------------------------ -------------------------------- Christopher A. Crane President and Chief Executive Officer Name: ------------------------------ Title: ------------------------------ ----------------------------------- Linda Hoffman [SIGNATURE PAGE TO THE ASSIGNMENT AND ASSUMPTION AGREEMENT] B-4 EXHIBIT C LICENSE AGREEMENT [LOGO] COMPS InfoSystems, Inc. Customer # ___________________ Subscription Licensing Agreement Contract # ___________________ Page 1 of 6 Purchase Order # _____________ Exhibit "C"
==================================================================================================================================== Name: Goodwin Partners Name: --------------------------------------------------------- --------------------------------------------------------- Bill-to Contact: Don Guy Ship-to Contact: ------------------------------------------------ ---------------------------------------------- Address: 8303 Mopac, Suite 3325 Address: SAME -------------------------------------------------------- ----------------------------------------------------- City: Austin State: TX ZIP: 78759 City: State: ZIP: -------------------------- ----- ----------- ------------------- ------ ----------------- County: Travis E-Mail: eire@texas.net County: E-Mail: ------------------------- --------------------- ------------------ ---------------------------- Telephone: 512-917-7056 Fax: 512-502-4905 Telephone: Fax: ----------------------- ------------------------ --------------- ------------------------------
==================================================================================================================================== SUBCRIPTION TERM BILLING CYCLE (circle one) COMPSLINK WINDOWS VERSION DELIVERY FORMAT Start: 1/99 End: 12/00 Semi-Yr [Yrly] Mthly Qtrly (circle one) 100 200 300 [400] [X] FTP (N/C) No. of Mos: 24 Enterprise_____ [_] Diskette ($1.95 Renewal Date: 12/00 USER STATUS month per item) HARDWARE CONFIGURATION [_] Sole Proprietor [_] CD ($5.00/month HISTORICAL REPORTS [X] Stand alone [X] Standard per region) From: 1/92 Thru: 12/98 [X] Network - LAN CONCURRENT USERS (circle one) No. of Mos.: 72 [_] Network - WAN # locations: 1 2-3 4-5 6-10 Other:_______________
==================================================================================================================================== LINE #/Sets COUNTY PROPERTY TYPE HISTORIAL REPORTS SUBSCRIPTION TOTAL # Same / Diff. (Other) Amount Credit Subtotal (Initial (Initial Location Term) Term) - ----------------------------------------------------------------------------------------------------------------------------------- 1 1 AUSTIN [C&I] [Apt/Res Lnd] 3495 $3495 (3495) $ -0- $ $ 3495 2 Travis/Williamson C&I Apt/Res Lnd $ $ $ $ 3 DALLAS METRO C&I Apt/Res Lnd $ $ $ $ 4 Dallas C&I Apt/Res Lnd $ $ $ $ 5 Tarrant C&I Apt/Res Lnd $ $ $ $ 6 Collin C&I Apt/Res Lnd $ $ $ $ 7 Denton C&I Apt/Res Lnd $ $ $ $ 8 DENVER METRO C&I Apt/Res Lnd $ $ $ $ 9 Denver C&I Apt/Res Lnd $ $ $ $ 10 El Paso C&I Apt/Res Lnd $ $ $ $ ==================================================================================================================================== Subscription fee waived as term of Acquisition Agreement for Hoffman Valuation Data Services $ $ 3495 for documentation.
- ------------------------------------------------------------------------------------------------------------------------------------ OTHER CHARGES: Duplicate Sets $______ WAN $______ Billing Cycle $______ User Level $______ Other $______ Total: $_____ CREDITS: Sole Proprietor $______ Volume $______ Multi-Year $______ EDS $______ Conversion $______ Other $______ Total: ($3495) - ------------------------------------------------------------------------------------------------------------------------------------
Agreement allows Goodwin Partners to export sales price data to the Office Building Report for the term of this Agreement or so long as Goodwin owns and publishes the Report. 2 additional copies to be shipped in short term with allowance to convert to 4-5 multi-task @ their discretion.
Ordered By: Don Guy Department: Date: 12/7/98 Subtotal $ -0- ------------------ ----------- ---------- -------- Sales Tax ____% $_______ Materials/C.P.R. $_______ Set-Up Fee $_______ GRAND TOTAL $ -0- --------
This Subscription Licensing Agreement between the above-named Customer and COMPS InfoSystems, Inc. ("COMPS") establishes the terms an d conditions under which COMPS will provide the services (the "Services") as set forth in this Agreement. Attached to and incorporate d into this Subscrption Licensing Agreement are the COMPS InfoSystems, Inc. General Terms and Conditions, which are an integral part of the agreement being formed hereby. Each person executing this Agreement on behalf of COMPS or Customer represents and warrants that he or she has been authorized to do so, and that all necessary actions (if any) required for the execution have been taken.
TOTAL YEAR 2 $ ---------- Customer: Goodwin Partners COMPS Infosystems, Inc. TOTAL YEAR 3 $ ------------------------------------ ---------- By: X /s/ Don Guy By: /s/ MICHAEL ARABE Business Code: 84 ------------------------------------------ ----------------------------------- ---------- Name (print): Don Guy Name (print): MICHAEL ARABE Source Code: --------------------------------- ----------------------------------- ---------- Title: PARTNER Date: 12/7/98 Title: SVP OF SALES Date: 12/7/98 Sales Rep: NDA / ___ ----------------------- ---------- ----------------- --------- ---------- ====================================================================================================================================
SUBSCRIPTION LICENSING AGREEMENT 1. TERMS OF AGREEMENT. Attached to this Agreement and incorporated into this Agreement in its entirety are COMPS' General Terms and Conditions. The word "Agreement" will apply to all terms and conditions of the parties --------- whether contained in this Subscription Licensing Agreement or the General Terms and Conditions. Customer should carefully read all terms of the Agreement to become thoroughly familiar with all rights granted and duties imposed by Customer's use of COMPS materials. 2. SUBSCRIPTION. Subject to the terms and conditions of this Agreement, COMPS will provide to Customer, and Customer accepts, the COMPS services indicated on the cover page of this Agreement. The materials, documentation, software and information provided in any medium are collectively referred to as the "Subscription Materials." Customer may load and use any retrieval software provided to Customer by COMPS ("Software") on such computer systems and for such users as are set forth on the cover page of this Agreement. Customer will be responsible for all telephone charges, Internet service provider charges, and hardware/software necessary to access the Subscription Materials. 3. OWNERSHIP. All right, title and interest in Subscription Materials and any modifications, elaborations, derivatives or updates thereof, regardless of the authorship of such derivative works, in all languages, formats and media throughout the world, including all copyrights, are and will continue to be the exclusive property of COMPS. Customer acknowledges that Customer is licensing and leasing the use of the Subscription Materials and the Software, not buying Subscription Materials, Software or information contained within them. 4. TERM. The initial term of this Agreement, as set forth on the signature page hereto, extends from the Start Service Date to such End of Initial Term Date as Customer and COMPS agree to, plus, it so agreed by Customer and COMPS, an additional period of 12, 24 or 36 months, as indicated on the order page of the Agreement. The first day of the month following the End of Initial Term Date or (if applicable) following the agreed-upon additional period is the "Renewal Date." If no Renewal Date or End of Initial Term Date appears on the order page of the Agreement, then the term of the Agreement will be deemed to be 24 months from the Start Service Date. After the End Date or (if applicable) the Renewal Date, this Agreement, unless terminated pursuant to Section 5, will automatically renew for successive 12-month periods. 5. TERMINATION. COMPS may terminate this Agreement or suspend Services pursuant to this Agreement at any time in its own discretion effective upon receipt of the notice of termination and at any time effective immediately upon: (a) any failure of Customer to pay any amounts as required in this Agreement; (b) any breach by Customer of any provision of this Agreement related to Customer's use of the Subscription Materials; (c) any insolvency, bankruptcy, assignment for the benefit of creditors, appointment of a trustee or receiver or similar event with respect to Customer; (d) any governmental prohibition or required alteration of services or any violation of applicable law, rule or regulation or (e) any breach of or other reason set forth on the attached General Terms and Conditions. Customer may only terminate this Agreement effective on the Renewal Date or on each successive anniversary thereof or, if no Renewal Date has been agreed to, on the End of Initial Term Date or on each successive anniversary thereof by providing written notice, by certified mail, to COMPS at least 30 days prior to such applicable Renewal Date, End of Initial Term Date or anniversary of such date. 6. EFFECT OF TERMINATION. Any termination will not relieve Customer of its obligation to pay any charges incurred pursuant to this Agreement prior to such termination. In the event that Customer terminates this Agreement prior to the Renewal Date: (a) Customer will immediately pay any and all of the amounts due under this Agreement, (b) any credits, bonuses, or incentives provided to Customer by COMPS will be due and payable by Customer and (c) Customer will, upon demand, immediately return all Subscription Materials and Software to COMPS. 7. CANCELLATION FEES. COMPS will have the right to assess a reasonable cancellation fee, including a fee for administrative expenses and an amount equal to COMPS' estimate of lost revenue, in case of any cancellation of this Agreement: (a) by Customer prior to the next occurring Renewal Date or anniversary thereof or (b) by COMPS in case of a breach by Customer. Customer will pay the cancellation fee in addition to any remaining contract obligations. 8. AUTHORIZED USERS. All terms and conditions of this Agreement are applicable to all Customer's employees (as this term is defined in Section 3 of the General Terms and Conditions). Customer agrees to assume sole responsibility for all employees' compliance with this Agreement, for all charges incurred by each employee and for maintaining the security respecting any passwords issued to such employees. 9. SUCCESSORS. The rights granted under this Agreement may be transferred to a successor entity only if (a) such successor entity is approved by COMPS, (b) the successor entity executes a new Subscription Licensing Agreement and (c) the successor entity pays COMPS a transfer fee of ten percent (10%) of the cumulative fees for the Subscription Materials. COMPS expressly reserves the right to deny, in its sole and absolute discretion, transfer of the rights granted under this Agreement or the Subscription Materials, and in the event of such denial, neither Customer nor any employee of Customer may take the Subscription Materials to another company or other entity. SUBSCRIPTION LICENSING AGREEMENT (76008.1) Only Page COMPS INFOSYSTEMS, INC. GENERAL TERMS AND CONDITIONS FOR LICENSED USE OF REPORTS AND SOFTWARE 1. APPLICABILITY OF TERMS AND CONDITIONS. CUSTOMER SHOULD CAREFULLY READ THESE TERMS AND CONDITIONS. These terms and conditions apply to all products, services, software, documentation and information that COMPS Infosystems, Inc. ("COMPS") provides (or has previously provided) to Customer in whatever media or form, including, but not limited to, paper, diskettes, CD-ROM, Internet or on-line and any publications and software, produced, published and/or distributed by COMPS. 2. LIMITED LICENSE. Subject to these terms and conditions, COMPS hereby grants a revocable, non-transferable, non-exclusive license to use the Reports and Software provided by COMPS to Customer solely for the Permitted Uses (as defined below). "Reports" means the information that COMPS provides under ------- these terms and conditions, including the Internet and on-line services, data, photographs and maps on diskette or CD-ROM or on any other medium and all subscription materials and printed reports, whether in electronic or paper form. and any subsets, annotations, alterations, modifications or updates thereof. "Software" means any software, including new versions and -------- the accompanying user documentation, provided by COMPS to Customer to allow or facilitate Customers access to, retrieval of or use of the Reports. Customer will not accept copies of the Reports from any person or entity other than COMPS. 3. PERMITTED ACCESS. For purposes of this Agreement, an "employee" of Customer is any person who would be deemed such by the Internal Revenue Service and who performs at least twenty (20) hours of work per week for Customer. Customer acknowledges that only users who license the Reports or Software directly from COMPS, or those users' employees, are authorized to access the Reports or Software. Customer will ensure that access to and use of the Reports and Software is available only to employees needing such access, and that such use is conducted in a proper and legal manner. EXCEPT AS PERMITTED BY COMPS OR THIS AGREEMENT, CUSTOMER WILL NOT ALLOW NON EMPLOYEES ACCESS TO THE REPORTS OR SOFTWARE FOR ANY REASON. 4. PERMITTED USES. "Permitted Uses" means use of the Reports or Software by -------------- Customer in the course of Customer's business solely for the purpose of either supporting Customer's opinion of a property valuation or supporting a listing of Customer for sale or management of real property, including use in: (1) working papers or word processing or spreadsheet programs underlying a report prepared by Customer, (2) the final report prepared by Customer, (3) appraisals, (4) listing proposals, (5) presentations to financial institutions for asset valuation and review purposes, and (6) marketing packages. Customer is permitted to reproduce single Reports where used by Customer to support the valuation of a specific property. Permission to reproduce such Reports is limited to reproductions that are contained in actual final reports and proposals that are submitted to a Customer's client and to working papers therefor, and such reproductions will in no event exceed a reasonable number without the express written permission of COMPS. The permission granted to reproduce paper Reports is strictly limited to the circumstances described in this paragraph. "Permitted Uses" does not include use by or duplication for employees of Customer other than at the specific address to which the Reports are delivered. 5. PROHIBITED USES. Notwithstanding whether Customer obtains COMPS' Reports or Software from COMPS or any third party, Customer will not copy, annotate, alter, publish, broadcast, enhance, modify, sell, upload, download or in any other way reproduce the Reports or the Software except as expressly provided for in these terms and conditions or unless COMPS gives Customer its prior, written consent. Customer will not use, key, scan or type any part of the Reports or enter data contained within the Reports for the purpose of compiling databases or similar compilations to give, sell, rent or provide access to anyone, and Customer will not compete with COMPS. Customer will refer to COMPS anyone seeking to create derivative works from the Reports. The systematic accumulation of Reports or any part thereof retrieved by Customer from COMPS for storage in or export to any archival database for the purpose of future retrieval or re-use not related to the original purpose or job for which Reports were obtained, is specifically prohibited. Notwithstanding any provision to the contrary in Section 4 above, Customer is expressly prohibited from storing, copying, exporting or transferring the Reports or any part or derivative thereof into any contact management program, automated valuation programs, statistical analysis program or searchable database in Customer's own computer or any other electronic or other device. Customer may not resell the Reports or Software or any part or derivative thereof. Customer may not adapt, translate, export, decompile, disassemble or create derivative works of GENERAL TERMS AND CONDITIONS (76009.1) Page 1 of 4 the Reports or Software or any part thereof. Customer may not export Reports or any part thereof into any software other than word processing or spreadsheet programs, nor further export Reports or any part thereof out of such software. Customer is specifically prohibited from including COMPS' Reports or Software in any "data library" or other data-sharing arrangement accessible to anyone other than Customer's employees. Customer may not under any circumstances post the Reports or any portion thereof on any Internet site. The provisions of this Section will survive any termination or expiration of this Agreement. 6. SATELLITE OFFICES. The license for use of the Reports and the Software granted to Customer will only include Customer's employees located at the Customer's address or other address for which the Reports are licensed. If Customer operates offices at locations other than such address ("Satellite --------- offices") and if Customer has employees who will use the Reports or ------- Software at such Satellite Offices then Customer will pay an additional user fee for those Reports or Software used in the Satellite Offices. CUSTOMER MAY NOT DUPLICATE THE REPORTS FOR USE IN THE SATELLITE OFFICES OR OTHERWISE ALLOW ELECTRONIC, NETWORK, ON-LINE OR OTHER ACCESS TO THE REPORTS OR SOFTWARE FROM SUCH SATELLITE OFFICES. 7. OWNERSHIP. All right, title and interest in reports and Software and any modifications, elaborations or derivatives thereof, regardless of the authorship of such derivative works, in all languages, formats and media throughout the world, including all copyrights, are and will continue to be the exclusive property of COMPS. Customer acknowledges that Customer is licensing and leasing the use of the Reports and the Software, not buying Reports, Software or information contained within them. 8. COPYRIGHTS. COMPS' Reports, Software and databases are copyrighted and are protected by the copyright laws of the United States and the Universal Copyright Convention. Customer acknowledges that the Reports and Software are proprietary to COMPS - and comprise: (a) works of original authorship including compiled Reports containing COMPS' copyrightable selection, arrangement and coordination and expression of such Reports or material it has created, gathered or assembled; (b) confidential and trade secret information; and (c) work product that has been created. developed and maintained by COMPS at great expense of time and money such that misappropriation or unauthorized use by others for commercial gain would unfairly and irreparably harm COMPS. Customer will not commit or permit any act omission that would impair COMPS' copyright and other intellectual property rights in the Reports and Software. COMPS has the sole right to annotate, alter, or modify any Reports or Software or, except as permitted by this Agreement, integrate or incorporate the Reports or Software into another database. contract management, automated valuation or statistical analysis program or other work. Any Reports or Software that are reformatted, incorporated into another work, annotated, altered, or modified by Customer will be derivative works that remain the sole property of COMPS. Except for the limited license provided, COMPS reserves all rights in and to Reports, Software and all underlying data compilations and information maintained by COMPS, including but not limited to the exclusive rights under copyright and the right to grant further licenses. 9. TRADEMARKS. Customer will not use any trademark, service mark or trade name of COMPS or any of its affiliated companies without COMPS' prior written consent. The parties agree that COMPS' copyright and trademark notices will at all times remain on all Reports and Software. and Customer will not remove or alter such copyright and trademark notices. Customer acknowledges that no right has been granted by, COMPS to reproduce or use in any way COMPS' trademarks. 10. CONFIDENTIALITY. Customer will treat the Reports in any form as confidential and will not divulge them to any person except as permitted by these terms and conditions. Customer will instruct its employees who have access to the Reports to keep them confidential. 11. LIMITED WARRANTY. COMPS warrants that (a) COMPS has obtained the information contained in the Reports from sources that COMPS believes to be reliable and (b) the media on which the information contained in the Reports is delivered is free from defects in material and workmanship for a period if' 90 days from delivery to Customer. If any media containing any Reports or Software is defective, COMPS will at COMPS' sole option, either repair or replace it. In either case, Customer will return to COMPS all defective media containing Reports or Software along with an explanation of the nature of the defect. Any replacement media will be warranted for the remainder of the original warranty period. Customer understands that COMPS does not and cannot for the fees charged guarantee or warrant the correctness, completeness, currentness, merchantability or fitness for a particular purpose of its Reports. Accordingly, the data and information GENERAL TERMS AND CONDITIONS (76009.1) Page 3 of 4 contained in the Reports and Software is delivered AS IS, and COMPS does not warrant, represent, or guaranty its correctness, accuracy or completeness. Customer acknowledges and agrees that the provisions of this limited warranty constitute the sole and exclusive remedy available to it with regard to the Reports and Software. 12. WARRANTY DISCLAIMER. COMPS DISCLAIMS ANY AND ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF NON-INFRINGEMENT OF THIRD-PARTY RIGHTS, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. 13. RISK ALLOCATION. Customer also acknowledges that (a) every business decision to some degree represents an assumption of risk, (b) the prices that COMPS charges its Customers for Reports are based, in part, upon COMPS' expectation that the risk of any loss that might be incurred by Customer in reliance upon the Reports will be borne by Customer, and COMPS in furnishing information does not assume Customer's risks, (c) certain information provided in connection with COMPS' Reports is received from third parties and COMPS has undertaken such inquiry as COMPS, in its discretion, deems appropriate to determine the qualifications of each such third party, but COMPS does not in any way guaranty or warrant the accuracy of any information provided by such third party. COMPS will not be liable for any loss, injury, claim, liability or damage of any kind resulting in any way from (1) any errors in or omissions from the Reports, (2) the unavailability of Reports or an interruption in the delivery of Reports, (3) Customer's use of the Reports or the Software, (4) COMPS' negligent or other acts or omissions in procuring, compiling, collecting, interpreting, reporting, communicating or delivering Reports or (5) any termination or non-renewal of this Agreement. Customer will defend, indemnify and hold harmless COMPS from and against any and all claims, losses or damages to persons or property resulting indirectly or directly from Customer's use of the Reports, products and services provided under these terms and conditions. 14. LIMITATION OF LIABILITY. COMPS' AGGREGATE LIABILITY UNDER THESE TERMS AND CONDITIONS OR IN CONNECTION WITH ANY OTHER CLAIM ARISING OUT OF OR RELATING TO THE REPORTS OR SOFTWARE WILL NOT EXCEED THE ANNUAL AMOUNT ACTUALLY RECEIVED BY COMPS FROM CUSTOMER PURSUANT TO THIS AGREEMENT. NEITHER COMPS NOR ANY RELATED PARTY WILL BE LIABLE FOR ANY SPECIAL, INDIRECT, INCIDENTAL. OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER REGARDLESS OF ANY NEGLIGENCE OF COMPS OR ANY RELATED PARTY AND EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, COMPS, ITS AFFILIATES, AGENTS OR LICENSORS WILL NOT BE LIABLE TO CUSTOMER OR ANYONE ELSE FOR ANY DECISION MADE OR ACTION TAKEN BY CUSTOMER IN RELIANCE ON COMPS' REPORTS. 15. COMPLIANCE. When Reports or Software are provided subject to restrictions on frequency of use or on the total number of users. Customer will comply with those restrictions. Customer will permit COMPS to inspect Customer's offices or facilities during regular business hours the point or points at which Reports and Software are used and to furnish whatever assistance is reasonably necessary to permit COMPS to determine Customer's compliance or the extent of Customer's noncompliance. Customer authorizes COMPS to send notices of non-compliance or delinquent account status by means of the most expedient method available, including without limitation telex, telegram, facsimile, electronic mail or letter as determined by COMPS. The failure of Customer strictly to comply with these terms and conditions will constitute irrevocable default and will lead immediately to the termination of the right of Customer to use the Reports and Software and, upon COMPS' election, of any other agreement between Customer and COMPS. 16. EXPIRATION OR TERMINATION. In the event of any expiration or termination of this Agreement: (a) Customer's continuing right to access or use COMPS' Reports or any other COMPS products or services, granted at COMPS' sole discretion, is limited to the Reports and Software that Customer has licensed from COMPS in the past; (b) Customer has no right to access or use any other COMPS Reports accessed or obtained from any source other than COMPS; and (c) Customer will, if COMPS so demands, within seven (7) days return to COMPS all Reports, Software and any other materials in Customer's possession containing COMPS' information and will deliver to COMPS a written certification of Customer's .compliance with the foregoing. Upon any termination or expiration of this Agreement, COMPS may send a representative to Customer's location to retrieve COMPS' Reports, Software and other information belonging to COMPS, which Customer agrees to deliver to such representative upon demand at that time. GENERAL TERMS AND CONDITIONS (76009.1) Page 4 of 4 17. REMEDIES. All of the remedies set forth in these terms and conditions are in addition to any that may be available under applicable law and are cumulative and not alternative. 18. PRICES. Unless otherwise specified in writing, COMPS' published prices will apply to any Reports or Software or other services provided by COMPS to Customer and are exclusive of taxes, use, excise or other similar taxes and any such present or future applicable taxes on the sale of Reports or Software services and/or products will be paid by the Customer. Requested expedited handling will be subject to an additional charge. COMPS reserves the right to revise its prices in connection with its adoption of a new price schedule or modification of existing schedules that are generally applicable to the Reports and Software. Unless otherwise specified in writing, such revised prices will be applicable to all Reports and Software delivered on and after the effective date of the price change. 19. PAYMENT TERMS. Customer will pay the price for the Reports, materials, Software or services delivered to Customer, as specified on the invoice therefor delivered to Customer by COMPS. When COMPS has extended credit to Customer, the terms of payment will be net 30 days from the date of invoice unless different terms are agreed to in writing. The amount of credit or terms of payment may be changed or credit withdrawn by COMPS at any time. Payment will be made without any deduction or offset by reason of any alleged counterclaim. COMPS' most recent written invoice, change order or statement of account will constitute presumptive evidence of all amounts due and owing from Customer unless disputed by Customer in writing within ten business days or COMPS' mailing or transmittal to Customer of such invoice, change order or statement of account. All payments received after the due date will incur a late payment charge in an amount equal to 1-1/2% per month (18% per year) until paid or at such lesser interest rate as is required by any applicable law Customer will pay to COMPS fifteen dollars ($15.00) for each check delivered to COMPS that is returned for insufficient funds. If any suit or arbitration is brought to collect any amounts owing by Customer, COMPS will be entitled to recover its costs and attorneys' fees incurred in connection with collecting such amounts owed. COMPS may withhold delivery of any Reports or Software under this Agreement if Customer does not pay any amount when due under this Agreement. 20. INJUNCTIVE RELIEF. In the event of a breach of these terms and conditions by Customer, COMPS will suffer irreparable harm and will be entitled to injunctive relief as well as all other remedies available at law or equity, without the necessity of posting a bond. 21. LIQUIDATED DAMAGES. Customer acknowledges and agrees that COMPS' actual damages for Customer's breach of this Agreement cannot be precisely estimated in advance. COMPS may elect to recover liquidated damages for each breach by Customer of any provision of this Agreement related to COMPS' copyrights in the Subscription Materials. If COMPS elects to do so, Customer agrees to pay COMPS, for each such breach, liquidated damages of three times the amount charged Customer by COMPS for the use of Subscription Materials in the twelve months preceding such breach. Customer agrees that these liquidated damages are fair and equitable and in no way punitive. 22. RIGHT OF OFFSET. If COMPS has reason to believe that Customer is in breach of any provision of this Agreement related to COMPS' copyrights in the Subscription Materials, Customer agrees that COMPS may retain any or all of Customer's advance payment(s) for Reports or Software or subscription fees as a partial or complete offset against any damages amount to which COMPS may ultimately be entitled for Customer's breach(es). COMPS will not apply the offset to the total damages amount owed COMPS by Customer for breach until that amount has been fixed through litigation. arbitration or agreement. 23. DISPUTES. These terms and conditions will be governed by and construed under the laws of the State of California without regard to the application of the principles of conflict of laws, and, subject to the arbitration provisions set forth below, the Customer and COMPS (the "Parties") will submit all disputes arising out of or related to these terms and conditions or to the performance, breach or termination, thereof, to binding arbitration pursuant to the Expedited Procedures of the Commercial Arbitration Rules ("Rules") of the American Arbitration Association ("AAA"). The arbitration will take place in San Diego, California. The dispute will be resolved by a single arbitrator appointed by the AAA in accordance with the list procedure described in Paragraph 13 of the Rules, except that the AAA will transmit the list within ten days of the filing of the Demand for Arbitration, and the Parties will have five days to return the list to the AAA with their objections and preferences. Discovery will be limited to no more than two depositions by each side and written document requests, requesting the production of specific documents. The Parties will voluntarily produce any and all documents that they intend to use at the hearing before the close of GENERAL TERMS AND CONDITIONS (76009.1) Page 5 of 4 discovery, subject to supplementation for purposes of rebuttal or good cause shown. The period for taking discovery will be 60 days, commencing upon the day that the answer is due under the Rules. The arbitrator will hold a pre-hearing conference within three days of the close of discovery and will schedule the hearing within 30 days of the close of discovery. Prior to the selection of the arbitration, nothing in this Agreement will prevent the Parties from applying to a court that would otherwise have jurisdiction for provisional or interim injunctive other equitable measures. After the arbitral panel is selected, it will have sole jurisdiction to hear such applications, except that any measure ordered by the arbitrator may be immediately and specifically enforced by a court otherwise having jurisdiction over the Parties. Each party will pay its own fees and costs associated with the Arbitration. Each party will pay one-half the estimated arbitrator's fees up front and if either party fails to do so a default will be entered against such party. The Parties submit to the exclusive jurisdiction of any court sitting in the County of San Diego, State of California, for the resolution of any dispute or enforcement of any right arising out of or relating to this Section 23, ---------- and waive any objection to the venue or personal jurisdiction of said courts. The Parties agree that the arbitrator will be entitled to award to COMPS, for each breach by Customer of any provisions of this Agreement, actual damages according to proof, liquidated damages in accordance with Section 21, or statutory damages for copyright infringement in accordance ---------- with the U.S. Copyright Act, at COMPS' election. 24. ENTIRE AGREEMENT. These terms and conditions (and any Subscription Licensing Agreement, if applicable) constitute the entire agreement between the parties and supersede all prior agreements, whether oral or written, which have been entered into before execution of these terms and conditions. 25. REQUIREMENT OF A WRITING. Copies and facsimiles of signed originals of these terms and conditions and of orders will be as binding on Customer as originals. Orders Placed by Customer regardless of communication method and accepted by COMPS will be binding on Customer. 26. CONSTRUCTION RULES. If any term or provision of these terms and conditions is held to be to extent invalid or otherwise unenforceable by any court of' competent jurisdiction, such provision will be construed as if it were written so as to effectuate to the greatest possible extent the parties' expressed intent, and in every case the remainder of these terms and conditions will not be affected thereby and will remain valid and enforceable. Typographical and clerical errors are subject to correction. 27. NOTICES. Any notice or communication provided for pursuant to these terms and conditions will be in writing and will be deemed given and received (a) upon delivery, if personally delivered or by facsimile transmission with receipt acknowledged, (b) one business day after having been deposited for overnight delivery with a well-recognized overnight courier or (c) three business days after deposit in U.S. mail when sent by registered or certified mail, postage prepaid, with proof of delivery at the address for such party previously provided to the other party by such party. 28. FORCE MAJEURE. COMPS' performance under these terms and conditions will be suspended and excused to the extent that COMPS is hindered or prevented from performance for causes beyond COMPS' control including, but not limited to, events of force majeure. 29. AMENDMENTS & WAIVERS. No modification or waiver of these terms and conditions will be binding on either party unless in writing and executed by the duly authorized officer of COMPS and by a duly authorized representative of Customer. The waiver by any party of any specific breach will not operate or be construed as a waiver of any preceding, contemporaneous or succeeding breach or as a continuing waiver. No failure or delay by a party in exercising any right, power, or privilege under these terms and conditions or other conduct by a party will operate as a waiver, and no single or partial exercise thereof will preclude the full exercise or further exercise of any right, power, or privilege. 30. BINDING AGREEMENT. These terms and conditions will only be effective and enforceable against COMPS when executed by a duly authorized representative of COMPS if unmodified or by the Chairman or President of COMPS if modified at COMPS' principal offices in San Diego, California. These terms and conditions are binding on the Customer and all successors, permitted assigns, agents, representatives, and employees of Customer. 31. SURVIVAL. The parties' rights and obligations which by their nature would extend beyond the termination, cancellation, or expiration of any agreement between the parties or these terms and conditions, will survive such termination, cancellation or expiration. 32. ASSIGNMENT. Customer will not assign any benefit under any agreement with COMPS or these terms and conditions without COMPS' written consent, which will, if given, be on such terms as COMPS deems to be appropriate. GENERAL TERMS AND CONDITIONS (76009.1) Page 6 of 4 EXHIBIT D FORM OF BILL OF SALE THIS BILL OF SALE dated as of _______________, 199__, is being executed and delivered by AOBR, Inc., a Texas corporation, and Linda Hoffman (collectively, "Sellers") pursuant to that certain Asset Purchase Agreement dated as of ______________, 199__ (the "Purchase Agreement"), by and among Sellers, Guy Goodwin, Don Guy and COMPS InfoSystems, Inc., a Delaware corporation ("Buyer"). The execution and delivery of this Bill of Sale is a condition to Buyer's obligations under the Purchase Agreement. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Sellers hereby agree as follows: 1. Capitalized terms used herein but not defined herein shall have the meanings assigned such terms in the Purchase Agreement. Subject to the terms and conditions set forth in the Purchase Agreement, Sellers hereby grant, sell, convey, assign, transfer and deliver to Buyer, and Buyer hereby purchases and acquires from Sellers, free and clear of any Encumbrance or adverse claim of any kind whatsoever, all of Sellers' right, title, and interest in and to all assets, properties, rights, contracts and interests of Sellers, wherever located, that are used in or pertain to the Business, as set forth below (collectively, the "Purchased Assets"). (a) the historical database of the Business, in electronic and hard copy form, including, without limitation, the Report, plat maps, photographs, and sales comparable data, owned or licensed by the Company and used in the Business; (b) all former, current and prospective customer lists, mailing lists, telephone numbers, correspondence, vendor lists, list of billings and receivables for former and current customer accounts of the Company related to the Business set forth in Schedule 2.1(b) to the Purchase Agreement (the --------------- "Business Customer Lists"); (c) all the Books and Records of the Company relating to the Business, including without limitation, operating data, the data collection methodology, sales and other literatures, files and documents relating to the Business (the "Business Records"); (d) all right, title and interest in and to all of the Company Intellectual Property, including, without limitation, (i) all of the Company's rights to the Company Trademarks; and (ii) the Company Intellectual Property set forth on Schedule 2.1(d) to the Purchase Agreement and all improvements, --------------- modifications and other Intellectual Property derived therefrom; (e) all licenses, permits, consents, approvals, orders, certificates, authorizations, declarations and filings held by the Company, including the fictitious business name statement or other similar document filed with the Texas Secretary of State for the name "Hoffman Valuation Data Services," necessary or incidental to the conduct of the Business as set forth in Schedule -------- 2.1(e) to the Purchase Agreement (the "Business Permits"); and - ------ D-2 (f) the goodwill and going concern value of the Business. 2. Buyer hereby waives compliance by Sellers with the provisions of the bulk transfer laws of any state. Sellers warrant and agree to pay and discharge when due all claims of creditors which could be asserted against Buyer by reason of such noncompliance. Pursuant to the terms of the Purchase Agreement, Sellers shall indemnify and hold Buyer harmless from, against and in respect of (and shall on demand reimburse Buyer for) any Damages suffered or incurred by Buyer by reason of the failure of Sellers to pay or discharge such claims. 3. From time to time after the date hereof, Sellers will execute and deliver, or cause their affiliates to execute and deliver, to Buyer such instruments of sale, transfer, conveyance, assignment and delivery, and such consents, assurances, powers of attorney and other instruments as may be reasonably requested by Buyer or its counsel in order to vest in the Company all right, title and interest of Sellers in and to the Purchased Assets and otherwise in order to carry out the purpose and intent of this Bill of Sale. 4. Notwithstanding any other provisions of this Bill of Sale to the contrary, nothing contained in this Bill of Sale shall in any way supersede, modify, replace, amend, change, rescind, waive, exceed, expand, enlarge or in any way affect the provisions, including warranties, covenants, agreements, conditions, representations or, in general any of rights and remedies, and any of the obligations and indemnifications of Sellers or Buyer set forth in the Purchase Agreement nor shall this Bill of Sale expand or enlarge any remedies under the Purchase Agreement including without limitation any limits on indemnification specified therein. This Bill of Sale is intended only to effect the transfer of certain property transferred pursuant to the Purchase Agreement and shall be governed entirely in accordance with the terms and conditions of the Purchase Agreement. 5. This Bill of Sale shall in all respects be construed in accordance with and governed by the laws of the State of California without giving effect to its conflicts-of-laws principles (other than any provisions thereof validating the choice of the laws of the State of California in the governing law). 6. This Bill of Sale may be executed by the parties herein in separate counterparts and by facsimile, each of which when so executed and delivered shall be an original, but all such counterparts and facsimile shall together shall constitute one and the same instrument. [SIGNATURE PAGE TO FOLLOW] D-3 IN WITNESS WHEREOF, Sellers have caused this Bill of Sale to be executed and delivered on the date and year first written above. AOBR, INC., a Texas corporation By: -------------------------------------- Name: ------------------------------------ Its: ------------------------------------- -------------------------------------- Linda Hoffman [SIGNATURE PAGE TO THE BILL OF SALE] D-4 EXHIBIT E FORM OF NON-COMPETITION AGREEMENT See Exhibit 10.19 to Registration Statement on Form S-1 E-1 EXHIBIT F FORM OF INTELLECTUAL PROPERTY ASSIGNMENT Intellectual Property Assignment is entered into this ___ day of _____________, 199__ by and among AOBR, Inc., a Texas corporation, Linda Hoffman (together, "Assignors"), and COMPS InfoSystems, Inc., a Delaware corporation ("Assignee"). WHEREAS, Assignee and Assignors are parties to that certain Asset Purchase Agreement dated ________________, (the "Purchase Agreement") (initially capitalized terms used herein and not otherwise defined herein shall have the meanings given to such terms in the Purchase Agreement); WHEREAS, the execution and delivery of this Intellectual Property Assignment is a condition precedent to Assignee's obligations under the Purchase Agreement. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: 1. Assignors assign to Assignee, and Assignee hereby accepts such assignment of, Assignors' entire right, title and interest in and to all of the Company Intellectual Property (as such intellectual property is defined and described in the Purchase Agreement and the schedules relating thereto), including, without limitation, the names "Hoffman Valuation Data Services" and the "Hoffman Report," and all variations thereof, and all rights to damages and payments for past, present or future infringements or misappropriations thereof in all countries and the goodwill of the Business and operations of the Company associated with the Intellectual Property. 2. The rights, title and interest assigned under Section 1 above shall be --------- for Assignee's own use and enjoyment, and for the use and enjoyment of Assignee's successors, assigns or other legal representatives, as fully and entirely as the same would have been held and enjoyed by the Assignors if this assignment and sale had not been made. 3. Where appropriate, Assignors authorize and request the Commissioner of Patents and Trademarks of the United States, and an official of any country or countries foreign to the United States, whose duty it is to register patents, trademarks or copyrights, to record Assignee as the assignee and owner of the Intellectual Property. 4. Concurrently with the execution of this Intellectual Property Assignment, Assignors shall deliver the original papers, applications, and other official documents relating to all patents and trademarks, and other Intellectual Property, assigned under Section 1 above. --------- 5. Assignors hereby represent and warrant that all rights, title, and interest assigned under Section 1 above are free and clear of Encumbrances and --------- that Assignors have not executed and will not execute any agreement or other instrument in conflict herewith. F-2 6. Assignors hereby covenant and agree that they shall cease and refrain from all use of all rights, title, and interests assigned under Section 1 above --------- in all countries of the world as of the date hereof. 7. With respect to the Company Intellectual Property, Assignors will, from and after the Closing (i) use their best efforts to keep such Company Intellectual Property confidential, including continuing to protect the confidential nature of such Company Intellectual Property as if the sale provided for in the Purchase Agreement had not occurred, (ii) not disclose the Company Intellectual Property to any third party and (iii) not use the Company Intellectual Property. 8. From time to time after the date hereof, Assignors will execute and deliver, or cause their affiliates to execute and deliver, to Assignee such instruments of sale, transfer, conveyance, assignment and delivery, and such consents, assurances, powers of attorney and other instruments as may be reasonably requested by Assignee or its counsel in order to vest in Assignee all right, title and interest of Assignors in and to the Purchased Assets and otherwise in order to carry out the purpose and intent of this Intellectual Property Assignment. 9. This Intellectual Property Assignment, together with the Purchase Agreement and all documents executed in connection with the Purchase Agreement, constitutes the entire agreement and understanding between and among the parties hereto with respect to the matters set forth herein, and supersedes and replaces any prior agreements and understandings, whether oral or written, between and among them with respect to such matters. Notwithstanding any other provisions of this Intellectual Property Assignment to the contrary, nothing contained in this Intellectual Property Assignment shall in any way superseded, modify, replace, amend, change, rescind, waive, exceed, expand, enlarge or in any way affect the provisions, including warranties, covenants, agreements, conditions, representations, or in general any of the rights and remedies, and any of the obligations and indemnifications of Assignors or Assignee set forth in the Purchase Agreement nor shall this Intellectual Property Assignment expand or enlarge any remedies under the Purchase Agreement including without limitation any limits on indemnification specified therein. This Intellectual Property Assignment is intended only to effect the transfer of certain property transferred pursuant to the Purchase Agreement and shall be governed entirely in accordance with the terms and conditions of the Purchase Agreement. 10. This Intellectual Property Assignment shall in all respects be construed in accordance with and governed by the laws of the State of California without giving effect to its conflicts-of-laws principles (other than any provisions thereof validating the choice of the laws of the State of California in the governing law). 11. This Intellectual Property Assignment may be executed by the parties herein in separate counterparts and by facsimile, each of which when so executed and delivered shall be an original, but all such counterparts and facsimile shall together shall constitute one and the same instrument. [SIGNATURE PAGE TO FOLLOW] F-3 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above. COMPS InfoSystems, Inc., AOBR, INC., a Delaware corporation a Texas corporation By: By: -------------------------------- -------------------------------- Christopher A. Crane President and Chief Executive Officer Name: ----------------------------- Title: ---------------------------- ---------------------------------- Linda Hoffman [SIGNATURE PAGE TO THE INTELLECTUAL PROPERTY ASSIGNMENT] F-4 ACKNOWLEDGMENT STATE OF TEXAS ) ) ss. COUNTY OF _________________ ) On this ______ day of November, in the year 1998, before me, the undersigned Notary Public, duly commissioned and sworn, personally appeared ______________________ and Linda Hoffman, personally known to me (or proved to me on the basis of satisfactory evidence) to be the persons whose names are subscribed to the within instrument and acknowledged to me that they respectively executed the same in their authorized capacities, and that by their signature on the instrument the persons executed the instrument. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate above written. [SEAL] ______________________________ Notary Public in and for the aforesaid County and State F-5 ACKNOWLEDGMENT STATE OF CALIFORNIA ) ) ss. COUNTY OF SAN DIEGO ) On this ______ day of November, in the year 1998, before me, the undersigned Notary Public, duly commissioned and sworn, personally appeared Christopher A. Crane, personally known to me (or proved to me on the basis of satisfactory evidence) to be the persons whose names are subscribed to the within instrument and acknowledged to me that they respectively executed the same in their authorized capacities, and that by their signature on the instrument the persons executed the instrument. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the day and year in this certificate above written. [SEAL] ______________________________ Notary Public in and for the aforesaid County and State F-6 EXHIBIT G FORM OF CERTIFICATES OF COMPANY OFFICER, HOFFMAN, GUY AND GOODWIN CERTIFICATE OF OFFICER AOBR, INC. This Certificate is delivered pursuant to Section 2.9(c)(viii) of that certain Asset Purchase Agreement (the "Agreement"), dated as of December 4, 1998, by and among COMPS InfoSystems, Inc., AOBR, Inc., Linda Hoffman, Guy Goodwin and Don Guy. Capitalized terms used herein without definition shall have the same meaning as set forth in the Agreement. I, ________________________, do hereby certify that I am the duly elected, qualified and acting ______________________ of the Company and as such, am authorized to execute this Certificate on its behalf, and I further certify that: 1. All representations and warranties of the Sellers and the Company Principals contained in the Agreement are true and correct on and as of the date hereof and the Sellers and the Company Principals have performed all agreements and covenants in a timely manner required to be performed by them prior to or on the date hereof. 2. No Actions or Proceedings have been instituted or threatened which question the validity or legality of the transactions contemplated by the Agreement. 3. Sellers and the Company Principals have not acted or caused any Person to act in any manner which has created or could reasonably create any Material Adverse Effect on the Company, Hoffman, the Business or the Purchased Assets, nor has there been any event or development which, individually or together with other such events, could reasonably be expected to result in a Material Adverse Effect on the Company, Hoffman, the Business or the Purchased Assets. 4. All Permits, authorizations, consents, approvals and waivers from third parties (including without limitation required consents set forth on Section 3.20 of the Disclosure Schedule to the Agreement) and Governmental or - ------------ Regulatory Authorities and other Persons necessary or appropriate to permit Sellers and the Company Principals to perform their respective obligations hereunder and to consummate the transactions contemplated by the Agreement have been obtained. IN WITNESS WHEREOF, I have executed this Certificate as of the Closing Date, this ____ day of ___________, 199__. By: ------------------------------ Name: ---------------------------- Title: --------------------------- G-2 CERTIFICATE OF LINDA HOFFMAN This Certificate is delivered pursuant to Section 2.9(c)(viii) of that certain Asset Purchase Agreement (the "Agreement"), dated as of _______________, 199__, by and among COMPS InfoSystems, Inc., AOBR, Inc., Linda Hoffman, Guy Goodwin and Don Guy. Capitalized terms used herein without definition shall have the same meaning as set forth in the Agreement. I, Linda Hoffman, do hereby certify that: 1. All representations and warranties of the Sellers and the Company Principals contained in the Agreement are true and correct on and as of the date hereof and the Sellers and the Company Principals have performed all agreements and covenants in a timely manner required to be performed by them prior to or on the date hereof. 2. No Actions or Proceedings have been instituted or threatened which question the validity or legality of the transactions contemplated by the Agreement. 3. Sellers and the Company Principals have not acted or caused any Person to act in any manner which has created or could reasonably create any Material Adverse Effect on the Company, Hoffman, the Business or the Purchased Assets, nor has there been any event or development which, individually or together with other such events, could reasonably be expected to result in a Material Adverse Effect on the Company, Hoffman, the Business or the Purchased Assets. 4. All Permits, authorizations, consents, approvals and waivers from third parties (including without limitation required consents set forth on Section 3.20 of the Disclosure Schedule to the Agreement) and Governmental or - ------------ Regulatory Authorities and other Persons necessary or appropriate to permit Sellers and the Company Principals to perform their respective obligations hereunder and to consummate the transactions contemplated by the Agreement have been obtained. IN WITNESS WHEREOF, I have executed this Certificate as of the Closing Date, this ____ day of ____________, 199__. ------------------------------ Linda Hoffman G-3 CERTIFICATE OF DON GUY This Certificate is delivered pursuant to Section 2.9(c)(viii) of that certain Asset Purchase Agreement (the "Agreement"), dated as of _____________, 199__, by and among COMPS InfoSystems, Inc., AOBR, Inc., Linda Hoffman, Guy Goodwin and Don Guy. Capitalized terms used herein without definition shall have the same meaning as set forth in the Agreement. I, Don Guy, do hereby certify that: 1. All representations and warranties of the Sellers and the Company Principals contained in the Agreement are true and correct on and as of the date hereof and the Sellers and the Company Principals have performed all agreements and covenants in a timely manner required to be performed by them prior to or on the date hereof. 2. No Actions or Proceedings have been instituted or threatened which question the validity or legality of the transactions contemplated by the Agreement. 3. Sellers and the Company Principals have not acted or caused any Person to act in any manner which has created or could reasonably create any Material Adverse Effect on the Company, Hoffman, the Business or the Purchased Assets, nor has there been any event or development which, individually or together with other such events, could reasonably be expected to result in a Material Adverse Effect on the Company, Hoffman, the Business or the Purchased Assets. 4. All Permits, authorizations, consents, approvals and waivers from third parties (including without limitation required consents set forth on Section 3.20 of the Disclosure Schedule to the Agreement) and Governmental or - ------------ Regulatory Authorities and other Persons necessary or appropriate to permit Sellers and the Company Principals to perform their respective obligations hereunder and to consummate the transactions contemplated by the Agreement have been obtained. IN WITNESS WHEREOF, I have executed this Certificate as of the Closing Date, this ____ day of ____________, 199__. --------------------------- Don Guy G-4 CERTIFICATE OF GUY GOODWIN This Certificate is delivered pursuant to Section 2.9(c)(viii) of that certain Asset Purchase Agreement (the "Agreement"), dated as of _________________, 199__, by and among COMPS InfoSystems, Inc., AOBR, Inc., Linda Hoffman, Guy Goodwin and Don Guy. Capitalized terms used herein without definition shall have the same meaning as set forth in the Agreement. I, Guy Goodwin, do hereby certify that: 1. All representations and warranties of the Sellers and the Company Principals contained in the Agreement are true and correct on and as of the date hereof and the Sellers and the Company Principals have performed all agreements and covenants in a timely manner required to be performed by them prior to or on the date hereof. 2. No Actions or Proceedings have been instituted or threatened which question the validity or legality of the transactions contemplated by the Agreement. 3. Sellers and the Company Principals have not acted or caused any Person to act in any manner which has created or could reasonably create any Material Adverse Effect on the Company, Hoffman, the Business or the Purchased Assets, nor has there been any event or development which, individually or together with other such events, could reasonably be expected to result in a Material Adverse Effect on the Company, Hoffman, the Business or the Purchased Assets. 4. All Permits, authorizations, consents, approvals and waivers from third parties (including without limitation required consents set forth on Section 3.20 of the Disclosure Schedule to the Agreement) and Governmental or - ------------ Regulatory Authorities and other Persons necessary or appropriate to permit Sellers and the Company Principals to perform their respective obligations hereunder and to consummate the transactions contemplated by the Agreement have been obtained. IN WITNESS WHEREOF, I have executed this Certificate as of the Closing Date, this ____ day of _______________, 199__. --------------------------- Guy Goodwin G-5 SCHEDULE 2.1(b) BUSINESS CUSTOMER LIST * * * *** = Certain information in this exhibit has been ommited and filed separately with the commission. Confidential treatment has been requested with respect to the omitted portions. SCHEDULE 2.1(D) COMPANY INTELLECTUAL PROPERTY 1. The Company Trademarks as defined in the Agreement 2. The method of ascertaining which properties sold during a given period of time and determining which of those properties are of such significance that they deserve confirmation of sales data, the preparation of a data sheet on each property to be confined, and the contacting of buyers, sellers, and brokers to obtain sales data. A detailed description of such methodology is described in Annex 2. 1 (d) attached hereto. ANNEX 2.1(d) HVDS REPORT LAST WEEK OF THE MONTH - ---------------------- 1. Order TCAD Run (Report name 801J) by date-range search. Paper report produced by TCAD. This report lists all the transactions within a specific date range. The property types are identified by structure code. 2. From the 801J report, properties are targeted for research. Transactions are entered into the "Comps -- Add Comps" database. FIRST WEEK OF THE MONTH - ----------------------- 1. Go to TCAD Working in "Add Comp" (on laptop computer), each transaction is pulled up and additional information about the property/transaction is entered. This task can take from 4-8 hours depending on the number of transactions. 2. Back at office, (a) export comps into their corresponding databases, (b) Enter Mapsco pages & grids, zip codes, sectors (quadrant), (c) print worksheets. 3. Compile phone numbers for each of the new transactions. Resources used: phone books, contact lists, Cole Director, Secretary of State, Co. Clerk, directory assistance. This typically takes a little less than a day. FIRST, SECOND & THIRD WEEKS OF THE MONTH - ---------------------------------------- 1. The calls begin. Confirmations typically run 2-1/2 to 3 weeks. We aim for a minimum of 60 sales per month. 2. Plats & zoning are pulled on weekly basis. 3. Sales info entered in databases. FINAL WEEK OF MONTH - ------------------- 1. Complete any input, boilerplate info, etc. 2. Final check is done to make sure that all sales have been entered. 3. Generate photo list and print Takephoto. 4. One-two days to take pictures. 5. After pictures, input any construction details lacking. 6. Generate delivery list, fax to Corporate Express. 7. Generate invoices. 8. Generate master report index. Generate indexes for index-only clients. 9. Print and proof report. Make any corrections. Print final master copy. 10. Make copies of report -- 3-hold paper. 11. Generate diskettes. (Client disks & comptroller disk). 12. Bind report -- 3-hold binders. Insert invoices & diskettes. Place in envelopes -- place for pickup by courier. 13. Mail out-of-town reports & indexes. SCHEDULE 2.1(e) BUSINESS PERMITS None. SCHEDULE 2.2 EXCLUDED ASSETS Excluded assets are all assets of the Business, the Company, Hoffman and the Company Principals that are not included in Article 2.1 of the Agreement. COMPS INFOSYSTEMS, INC. HOFFMAN VALUATION DATA SERVICES ALLOCATION OF PURCHASE PRICE SCHEDULE 2.5 Assets purchased: Value assigned to intangible assets purchased Goodwill 25,000 Research and Development Expense* 95,000 -------- Total value of assets purchased $120,000 ======== Purchase Price: Cash paid at purchase $120,000 -------- Total purchase price $120,000 ======== * Cost of assets purchased to be used for research and development of Austin market. Database to be used for purposes of historical information; no value assigned to sale or offer of historical information. DISCLOSURE SCHEDULES Section 3.1 (a). Officers and Directors of AOBR, Inc. -- Guy Goodwin, President, Director, 50% shareholder; Don Guy, Secretary, Director, 50% shareholder. Section 3.11. All purchased assets are located at 8303 North Mopac, Suite B325, Austin, TX 98759 Section 3.19. The billings/invoices provided to the Buyer is as of the commencement of operations of the Business under AOBR, Inc., subsequent to its purchase of the 50% interest of the Business from Hoffman up to date of delivery of same to Buyer on 11/18/98. The billings/invoices do not cover any part of 1997. Invoice prior to 4/98 have been discarded. There is a verbal agreement with Robin Davis, Austin Investor Interests, to provide her with quarterly multi-family sales data in return for her multi-family guide which is used by the business as a resource for data on multi-family properties. There are also verbal agreements with TCAD and WCAD to supply them with the monthly report in return for sales transaction data reports. There is a verbal agreement with Roger Holmes with the State of Texas Comptrollers office to provide him a monthly report in exchange for his confirmation of sales which is compiled from a questionnaire sent directly to buyers by the Comptrollers office. EX-10.46 49 LOAN AGREEMENT EXHIBIT 10.46 LOAN AND SECURITY AGREEMENT Dated as of February 12, 1999 between COMPS.COM, Inc. a Delaware corporation as "Borrower", and VENTURE LENDING & LEASING II, INC., a Maryland corporation as "Lender" LOAN AND SECURITY AGREEMENT The Borrower and Lender identified on the cover page of this document have entered or anticipate entering into one or more transactions pursuant to which Lender agrees to make available to Borrower a loan facility governed by the terms and conditions set forth in this document and that certain Supplement executed by Borrower and Lender and of even date herewith which incorporates this document by reference (the "Supplement"). The Supplement constitutes a supplement to and forms part of this document, and shall be read and construed as one with this document, so that this document and the Supplement constitute a single agreement between the parties (collectively referred to as this "Agreement"). Accordingly, the parties agree as follows: ARTICLE 1 - INTERPRETATION 1.1 DEFINITIONS. The terms defined in Article 10 and in the Supplement will have the meanings therein specified for purposes of this Agreement. 1.2 INCONSISTENCY. In the event of any inconsistency between the provisions of any Supplement and this document, the provisions of the Supplement shall govern. ARTICLE 2 - THE COMMITMENT AND LOANS 2.1 THE COMMITMENT. Subject to the terms and conditions of this Agreement, Lender agrees to make Loans to Borrower from time to time from the Closing Date and to, but not including, the Termination Date in an aggregate principal amount not exceeding the Commitment. The Commitment is not a revolving credit commitment, and Borrower does not have the right to repay and reborrow hereunder. Each Loan requested by Borrower to be made on a single Business Day shall be for a minimum principal amount set forth in the Supplement, except to the extent the remaining Commitment is a lesser amount. 2.2 NOTES EVIDENCING LOANS; REPAYMENT. Each Loan shall be evidenced by a separate Note payable to the order of Lender, in the total principal amount of the Loan. Principal and interest of each Loan shall be payable at the times and in the manner set forth in the Note. 2.3 PROCEDURES FOR BORROWING. (a) Borrower shall give Lender, at least five (5) Business Days' prior to a proposed Borrowing Date, written notice of any request for borrowing hereunder (a "Borrowing Request"). Each Borrowing Request shall be in substantially the form of Exhibit "B" to the Supplement, shall be executed by a responsible ----------- executive or financial officer of Borrower, and shall state the loan type(s) and amount(s) requested, and shall be accompanied by such other information and documentation as Lender may reasonably request. (b) No later than 1:00 p.m. Pacific Standard Time on the Borrowing Date, if Borrower has satisfied the conditions precedent in Article 4, Lender shall make the Loan available to Borrower in immediately available funds, less the amount of the broker's fee described in Section (2)D. of the Supplement. 2.4 INTEREST. Basic Interest on the outstanding principal balance of the each Loan shall accrue daily at the Designated Rate from the Borrowing Date until the Maturity Date. 2.5 TERMINAL PAYMENT. Borrower shall pay the Terminal Payment with respect to each Loan on the Maturity Date of such Loan. 2.6 INTEREST RATE CALCULATION. Basic Interest, along with charges and fees under this Agreement and any Loan Document, shall be calculated for actual days elapsed on the basis of a 360-day year, which results in higher interest, charge or fee payments than if a 365-day year were used. In no event shall Borrower be obligated to pay Lender interest, charges or fees at a rate in excess of the highest rate permitted by applicable law from time to time in effect. 2.7 DEFAULT INTEREST. Any unpaid payments of principal or interest or the Terminal Payment with respect to any Loan shall bear interest from their respective maturities, whether scheduled or accelerated, at the Designated Rate for such Loan plus five percent (5.00%) per annum, until paid in full, whether ---- before or after judgment (the "Default Rate"). Borrower shall pay such interest on demand. 1 2.8 INTENTIONALLY OMITTED 2.9 LENDER'S RECORDS. Principal, Basic Interest, Terminal Payments and all other sums owed under any Loan Document shall be evidenced by entries in records maintained by Lender for such purpose. Each payment on and any other credits with respect to principal, Basic Interest, Terminal Payments and all other sums outstanding under any Loan Document shall be evidenced by entries in such records. Absent manifest error, Lender's records shall be conclusive evidence thereof. 2.10 GRANT OF SECURITY INTERESTS. To secure the timely payment and performance of all of Borrower's Obligations to Lender, Borrower hereby grants to Lender continuing security interests in all of the Collateral to the Closing Date. If upon payment in full of all Obligations in respect of the Term Loan there remain outstanding Obligations in respect of any Equipment Loans, and if no Event of Default then exists, then Lender shall release its security interests in all Collateral except Equipment and Proceeds and Records relating solely to ------ Equipment. If upon payment in full of all Obligations in respect of all Equipment Loans there remain outstanding Obligations in respect of the Term Loan, and if no Event of Default then exists, then Lender shall release its security interests in all Collateral comprising Equipment and Proceeds and ---------- Records relating solely to Equipment. ARTICLE 3 - REPRESENTATIONS AND WARRANTIES Borrower represents and warrants that, except as set forth in the Supplement or any schedule of exceptions executed by the parties, as of the Closing Date and each Borrowing Date: 3.1 DUE ORGANIZATION. Borrower is a corporation duly organized and validly existing in good standing under the laws of the jurisdiction of its incorporation, and is duly qualified to conduct business and is in good standing in each other jurisdiction in which its business is conducted or its properties are located, except where the failure to be so qualified would not reasonably be expected to have a Material Adverse Effect. 3.2 AUTHORIZATION, VALIDITY AND ENFORCEABILITY. The execution, delivery and performance of all Loan Documents executed by Borrower are within Borrower's powers, have been duly authorized, and are not in conflict with Borrower's articles or certificate of incorporation or by-laws, or the terms of any charter or other organizational document of Borrower, as amended from time to time; and all such Loan Documents constitute valid and binding obligations of Borrower, enforceable in accordance with their terms (except as may be limited by bankruptcy, insolvency and similar laws affecting the enforcement of creditors' rights in general, and subject to general principles of equity). 3.3 COMPLIANCE WITH APPLICABLE LAWS. Borrower has complied with all licensing, permit and fictitious name requirements necessary to lawfully conduct the business in which it is engaged, and to any sales, leases or the furnishing of services by Borrower, including without limitation those requiring consumer or other disclosures, the noncompliance with which would have a Material Adverse Effect. 3.4 NO CONFLICT. The execution, delivery, and performance by Borrower of all Loan Documents are not in conflict with any law, rule, regulation, order or directive, or any indenture, agreement, or undertaking to which Borrower is a party or by which Borrower may be bound or affected except where such conflict would not reasonably be expected to have a Material Adverse Effect. 3.5 NO LITIGATION, CLAIMS OR PROCEEDINGS. There is no litigation, tax claim, proceeding or dispute pending, or, to the knowledge of Borrower, threatened against or affecting Borrower or its property that would reasonably be expected to have a Material Adverse Effect. 3.6 CORRECTNESS OF FINANCIAL STATEMENTS. Borrower's financial statements which have been delivered to Lender have been prepared in accordance with GAAP; and, since that date there has been no Material Adverse Change. 3.7 NO SUBSIDIARIES. Borrower is not a majority owner of or in a control relationship with any other business entity. 3.8 ENVIRONMENTAL MATTERS. Borrower has reviewed, or caused to be reviewed on its behalf, all Environmental Laws applicable to its business operations and materials handled therein, and as a result thereof has reasonably concluded that Borrower is in compliance with such Environmental Laws, except to the extent a failure to be in such compliance 2 would not reasonably be expected to have a Material Adverse Effect on Borrower's operations, properties or financial condition. 3.9 NO EVENT OF DEFAULT. No Default or Event of Default has occurred and is continuing. 3.10 FULL DISCLOSURE. None of the representations or warranties made by Borrower in the Loan Documents as of the date such representations and warranties are made or deemed made, and none of the statements contained in any exhibit, report, statement or certificate furnished by or on behalf of Borrower in connection with the Loan Documents (including disclosure materials delivered by or on behalf of Borrower to Lender prior to the Closing Date), contains any untrue statement of a material fact or omits any material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they are made, not misleading as of the time when made or delivered. 3.11 SPECIFIC REPRESENTATIONS REGARDING COLLATERAL. (a) TITLE. Except for the security interests created by this Agreement and Permitted Liens, (i) Borrower is and will be the unconditional legal and beneficial owner of the Collateral, and (ii) the Collateral is genuine and subject to no Liens, rights or defenses of others. There exist no prior assignments or encumbrances of record with the U.S. Patent and Trademark Office affecting any Collateral in favor of any third party other than Lender. (b) RIGHTS TO PAYMENT. The names of the obligors, amount owing to Borrower, due dates and all other information with respect to the Rights to Payment are and will be correctly stated in all material respects in all Records relating to such Rights to Payment. Borrower further represents and warrants, to its knowledge, that each Person appearing to be obligated on such a Right to Payment has authority and capacity to contract and is bound as it appears to be. (c) LOCATION OF COLLATERAL. Borrower's chief executive office, Inventory, Records, Equipment, and any other offices or places of business are located at the address(es) shown on the Supplement. (d) BUSINESS NAMES. Other than its full corporate name, Borrower has not conducted business using any trade names or fictitious business names except as shown on the Supplement. 3.12 COPYRIGHTS, PATENTS, TRADEMARKS AND LICENSES. (a) Borrower owns or is licensed or otherwise has the right to use all of the patents, trademarks, service marks, trade names, copyrights, contractual franchises, authorizations and other similar rights that are reasonably necessary for the operation of its business, without conflict with the rights of any other Person. (b) To Borrower's knowledge, no slogan or other advertising device, product, process, method, substance, part or other material now employed, or now contemplated to be employed, by Borrower infringes upon any rights held by any other Person. (c) No claim or litigation regarding any of the foregoing is pending or, to Borrower's knowledge, threatened, and no patent, invention, device, application, principle or any statute, law, rule, regulation, standard or code is pending or proposed which, in either case, would reasonably be expected to have a Material Adverse Effect. ARTICLE 4 - CONDITIONS PRECEDENT 4.1 CONDITIONS TO FIRST LOAN. The obligation of Lender to make its first Loan hereunder is, in addition to the conditions precedent specified in Section ------- 4.2, subject to the fulfillment of the following conditions and to the receipt - --- by Lender of the documents described below, duly executed and in form and substance satisfactory to Lender and its counsel: (a) RESOLUTIONS. A certified copy of the resolutions of the Board of Directors of Borrower authorizing the execution, delivery and performance by Borrower of the Loan Documents. (b) INCUMBENCY AND SIGNATURES. A certificate of the secretary of Borrower certifying the names of the officer or officers of Borrower authorized to sign the Loan Documents, together with a sample of the true signature of each such officer. (c) LEGAL OPINION. The opinion of legal counsel for Borrower as to such matters as Lender may reasonably request, including the matters covered by Sections 3.1, 3.2, 3.4 and 3.5 hereof. (d) ARTICLES AND BY-LAWS. Certified copies of the Articles or Certificate of Incorporation and 3 By-Laws of Borrower, as amended through the Closing Date. (e) THIS AGREEMENT. A counterpart of this Agreement and the Supplement, with all schedules completed and attached thereto, and disclosing such information as is acceptable to Lender. (f) FINANCING STATEMENTS. Filing copies (or other evidenced of filing satisfactory to Lender and its counsel) of such Uniform Commercial Code financing statements, collateral assignments and termination statements, with respect to the Collateral as Lender shall request. (g) PATENT AND TRADEMARK ASSIGNMENTS. If required by the Supplement, patent and trademark collateral assignments executed by Borrower. (h) LIEN SEARCHES. Uniform Commercial Code lien, judgment, bankruptcy and tax lien searches of Borrower from such jurisdictions or offices as Lender may reasonably request, all as of a date reasonably satisfactory to Lender and its counsel. (i) GOOD STANDING CERTIFICATE. A Certificate of status or good standing of Borrower as of a date acceptable to Lender from the jurisdiction of Borrower's organization and any foreign jurisdictions where a failure to be so qualified would reasonably be expected to have a Material Adverse Effect. (j) WARRANT. A warrant issued by Borrower to Lender exercisable for such number, type and class of shares of Borrower's capital stock, and for an initial exercise price as is specified in the Supplement. 4.2 CONDITIONS TO ALL LOANS. The obligation of Lender to make its initial Loan and each subsequent Loan is subject to the following further conditions precedent that: (a) NO DEFAULT. No Default or Event of Default has occurred and is continuing or will result from the making of any such Loan, and the representations and warranties of Borrower contained in Article 3 of this Agreement are true and correct in all material respects as of the Borrowing Date of such Loan. (b) NO MATERIAL ADVERSE CHANGE. No Material Adverse Change shall have occurred since the date of the most recent financial statements submitted to Lender. (c) BORROWING REQUEST. Borrower shall have delivered to Lender a Borrowing Request for such Loan. (d) NOTE. Borrower shall have delivered an executed Note evidencing such Loan, in form and substance satisfactory to Lender. (e) SUPPLEMENTAL LIEN FILINGS. Borrower shall have executed and delivered such amendments or supplements to this Agreement and such financing statements as Lender may reasonably request in connection with the proposed Loan, in order to create or perfect or to maintain the perfection of Lender's Liens on the Collateral. (f) VCOC LIMITATION. Lender shall not be obligated to make any Loan under its Commitment if at the time of or after giving effect to the proposed Loan Lender would no longer qualify as: (A) a "venture capital operating company" under U.S. Department of Labor Regulations Section 2510.3-101(d), Title 29 of the Code of Federal Regulations, as amended; and (B) a "business development company" under the provisions of federal Investment Company Act of 1940, as amended; and (C) a "regulated investment company" under the provisions of the Internal Revenue Code of 1986, as amended. ARTICLE 5 - AFFIRMATIVE COVENANTS During the term of this Agreement and until its performance of all obligations to Lender, Borrower will: 5.1 NOTICE TO LENDER. Promptly give written notice to Lender of: (a) Any litigation or administrative or regulatory proceeding affecting Borrower where the amount claimed against Borrower is at the Threshold Amount or more, or where the granting of the relief requested would have a Material Adverse Effect. (b) Any substantial dispute which may exist between Borrower or any governmental or regulatory authority, where such dispute would reasonably be expected to have a Material Adverse Effect. (c) The occurrence of any Event of Default or any event which with the giving of notice, the passage of time, or both, would constitute an Event of Default. 4 (d) Any change in the location of any of Borrower's places of business or Collateral at least thirty (30) days in advance of such change, or of the establishment of any new, or the discontinuance of any existing, place of business. (e) Any dispute or default by Borrower or any other party under any joint venture, partnering, distribution, cross-licensing, strategic alliance, collaborative research or manufacturing, license or similar agreement which could reasonably be expected to have a Material Adverse Effect. (f) Any other matter which has resulted or might reasonably result in a Material Adverse Change. 5.2 FINANCIAL STATEMENTS. Deliver to each Lender or cause to be delivered to Lender, in form and detail satisfactory to Lender the following financial information, which Borrower warrants shall be accurate and complete in all material respects: (a) MONTHLY FINANCIAL STATEMENTS. As soon as available but no later than thirty (30) days after the end of each month, Borrower's balance sheet as of the end of such period, and Borrower's income statement for such period and for that portion of Borrower's financial reporting year ending with such period, prepared and attested by a responsible financial officer of Borrower as being complete and correct and fairly presenting Borrower's financial condition and the results of Borrower's operations. After a Qualified Public Offering, the foregoing interim financial statements shall be delivered no later than 45 days after each fiscal quarter and for the quarter-annual fiscal period then ended. (b) YEAR-END FINANCIAL STATEMENTS. As soon as available but no later than one hundred twenty (120) days after and as of the end of each financial reporting year, a complete copy of Borrower's audit report, which shall include balance sheet, income statement, statement of changes in equity and statement of cash flows for such year, prepared and certified by an independent certified public accountant selected by Borrower and satisfactory to Lender (the "Accountant"). The Accountant's certification shall not be qualified or limited due to a restricted or limited examination by the Accountant of any material portion of Borrower's records or otherwise. (c) COMPLIANCE CERTIFICATES. Simultaneously with the delivery of each set of financial statements referred to in paragraphs (a) and (b) above, a certificate of the chief financial officer of Borrower substantially in the form of Exhibit "C" to the Supplement (i) setting forth in reasonable detail any calculations required to establish whether Borrower is in compliance with any financial covenants or tests set forth in the Supplement, and (ii) stating whether any Default or Event of Default exists on the date of such certificate, and if so, setting forth the details thereof and the action which Borrower is taking or proposes to take with respect thereto. (d) GOVERNMENT REQUIRED REPORTS; PRESS RELEASES. Promptly after sending, issuing, making available, or filing, copies of all statements released to any news media for publication, all reports, proxy statements, and financial statements that Borrower sends or makes available to its stockholders, and, not later than five (5) days after actual filing or the date such filing was first due, all registration statements and reports that Borrower files or is required to file with the Securities and Exchange Commission, or any other governmental or regulatory authority. (e) OTHER INFORMATION. Such other statements, lists of property and accounts, budgets, forecasts, reports, or other information as Lender may from time to time reasonably request. 5.3 MANAGERIAL ASSISTANCE FROM LENDER. Permit Lender, as a "venture capital operating company" to participate in, and influence the conduct of management of Borrower through the exercise of "management rights," as such terms are defined in 29 C.F.R. (S) 2510.3-101(d), and: (a) Permit Lender to make available to Borrower, at no cost to Borrower, "significant managerial assistance", as defined in Section 2(a)(47) of the Investment Company Act of 1940, as amended, either in the form of: (i) consulting arrangements with Lender or any of its officers, directors, employees or affiliates, (ii) Borrower's allowing Lender to provide recommendations of prospective candidates for election to Borrower's Board of Directors, or (iii) Lender, at Borrower's request, seeking the services of third-party consultants to aid Borrower with respect to its management and operations; (b) Permit Lender to make available consulting and advisory services to officers of Borrower regarding Borrower's equipment acquisition and financing plans, and such other matters affecting the business, financial 5 condition and prospects of Borrower as Lender shall reasonably deem relevant; and (c) If Lender reasonably believes that financial or other developments affecting Borrower have impaired or are likely to impair Borrower's ability to perform its obligations under this Agreement, permit Lender reasonable access to Borrower's management and/or Board of Directors and opportunity to present Lender's views with respect to such developments. 5.4 EXISTENCE. Maintain and preserve Borrower's existence, present form of business, and all rights and privileges necessary or desirable in the normal course of its business; and keep all Borrower's property in good working order and condition, ordinary wear and tear excepted. 5.5 INSURANCE. Maintain and keep in force insurance with an insurance carrier having a policyholder rating of not less than "A" and financial category rating of Class VII in "Best's Insurance Guide," unless otherwise approved by Lender and in such amounts and types as is usual in the business carried on by Borrower. Such insurance policies must be in form and substance satisfactory to Lender, and shall list Lender as an additional insured or loss payee, as applicable, on endorsement(s) in form reasonably acceptable to Lender. Borrower shall furnish to Lender such endorsements, and upon Lender's request, copies of any or all such policies. 5.6 ACCOUNTING RECORDS. Maintain adequate books, accounts and records, and prepare all financial statements in accordance with GAAP, and in compliance with the regulations of any governmental or regulatory authority having jurisdiction over Borrower or Borrower's business; and permit employees or agents of Lender at such reasonable times as Lender may request, at Borrower's expense, to inspect Borrower's properties, and to examine, and make copies and memoranda of Borrower's books, accounts and records. 5.7 COMPLIANCE WITH LAWS. Comply with all laws (including Environmental Laws), rules, regulations applicable to, and all orders and directives of any governmental or regulatory authority having jurisdiction over, Borrower or Borrower's business, and with all material agreements to which Borrower is a party, except where the failure to so comply would not have a Material Adverse Effect. 5.8 TAXES AND OTHER LIABILITIES. Pay all Borrower's obligations when due; pay all taxes and other governmental or regulatory assessments before delinquency or before any penalty attaches thereto, except as may be contested in good faith by the appropriate procedures and for which Borrower shall maintain appropriate reserves; and timely file all required tax returns. 5.9 SPECIAL COLLATERAL COVENANTS. (a) MAINTENANCE OF COLLATERAL; INSPECTION. Do all things reasonably necessary to maintain, preserve, protect and keep all Collateral in good working order and salable condition, ordinary wear and tear excepted, deal with the Collateral in all ways as are considered good practice by owners of like property, and use the Collateral lawfully and, to the extent applicable, only as permitted by Borrower's insurance policies. Maintain, or cause to be maintained, complete and accurate Records relating to the Collateral. Upon reasonable prior notice at reasonable times during normal business hours, Borrower hereby authorizes Lender's officers, employees, representatives and agents to inspect the Collateral and to discuss the Collateral and the Records relating thereto with Borrower's officers and employees, and, in the case of any Right to Payment, with any Person which is or may be obligated thereon. (b) FINANCING STATEMENTS AND OTHER ACTIONS. Execute and deliver to Lender all financing statements, notices and other documents (including, without limitation, any filings with the United States Patent and Trademark Office) from time to time reasonably requested by Lender to maintain a first perfected security interest in the Collateral in favor of Lender; perform such other acts, and execute and deliver to Lender such additional conveyances, assignments, agreements and instruments, as Lender may at any time request in connection with the administration and enforcement of this Agreement or Lender's rights, powers and remedies hereunder. (c) LIENS. Not create, incur, assume or permit to exist any Lien or grant any other Person a negative pledge on any Collateral, except Permitted Liens. (d) DOCUMENTS OF TITLE. Not sign or authorize the signing of any financing statement or other document naming Borrower as debtor or obligor, or acquiesce or cooperate in the issuance of any bill of lading, warehouse receipt or other document or instrument of title with respect to any Collateral, 6 except those negotiated to Lender, or those naming Lender as secured party. (e) DISPOSITION OF COLLATERAL. Not sell, transfer, lease or otherwise dispose of any Equipment; or dispose of any other Collateral except for fair consideration and in the ordinary course of its business. (f) CHANGE IN LOCATION OR NAME. Without at least 30 days' prior written notice to Lender: (a) not relocate any Collateral or Records, its chief executive office, or establish a place of business at a location other than as specified in the Supplement; and (b) not change its name, mailing address, location of Collateral, or its legal structure. (g) DECALS, MARKINGS. At the request of Lender, firmly affix a decal, stencil or other marking to designated items of Equipment, indicating thereon the security interest of Lender. (h) AGREEMENT WITH REAL PROPERTY OWNER/LANDLORD. Obtain and maintain such acknowledgments, consents, waivers and agreements from the owner, lienholder, mortgagee and landlord with respect to any real property on which Equipment is located as Lender may from time to time reasonably require, all in form and substance reasonably satisfactory to Lender. (i) CERTAIN AGREEMENTS ON RIGHTS TO PAYMENT. Other than in the ordinary course of business, not make any material discount, credit, rebate or other reduction in the original amount owing on a Right to Payment or accept in satisfaction of such a Right to Payment less than the original amount thereof. ARTICLE 6 - NEGATIVE COVENANTS During the term of this Agreement and until the performance of all obligations to Lender, Borrower will not (without Lender's prior written consent): 6.1 INDEBTEDNESS. Be indebted for borrowed money, the deferred purchase price of property, or leases which would be capitalized in accordance with GAAP; or become liable as a surety, guarantor, accommodation party or otherwise for or upon the obligation of any other Person, except: (a) Indebtedness incurred for the acquisition of supplies or inventory on normal trade credit; unsecured indebtedness for money borrowed for working capital or general corporate purposes from a commercial bank or institutional lender up to $500,000.00 in aggregate principal amount outstanding at any time; and other indebtedness incurred pursuant to one or more transactions permitted under Section 6.4; ----------- (b) Indebtedness not to exceed Two Hundred Fifty Thousand Dollars ($250,000) in aggregate principal amount outstanding at any time secured by purchase money security interests; (c) Indebtedness of Borrower under this Agreement or toVenture Lending & Leasing, Inc.; (d) Up to $750,000 of Indebtedness, singly or in the aggregate, in connection with one or more business acquisitions permitted hereunder; and (e) Any Indebtedness approved by Lender prior to the Closing Date. 6.2 LIENS. Create, incur, assume or permit to exist any Lien, or grant any other Person a negative pledge, on any of Borrower's property, except Permitted Liens. Borrower and Lender agree that this covenant is not intended to constitute a lien, deed of trust, equitable mortgage, or security interest of any kind on any of Borrower's real property, and this Agreement shall not be recorded or recordable. Notwithstanding the foregoing, however, violation of this covenant by Borrower shall constitute an Event of Default. 6.3 DIVIDENDS. Except after a Qualified Public Offering, pay any dividends or purchase, redeem or otherwise acquire or make any other distribution with respect to any of Borrower's capital stock, except (a) dividends or other distributions solely of capital stock of Borrower, and (b) repurchases of stock from employees upon termination of employment under reverse vesting or similar repurchase plans and except for dividend rights of Summit Ventures III, L.P. under that certain Investor Rights Agreement dated as of October 14, 1994. 6.4 CHANGES/MERGERS. Without the prior written consent of Lender (which consent shall not be unreasonably withheld and shall be deemed given if Lender shall have failed to notify Borrower of its withholding of consent for 30 or more days after Borrower's request therefor), liquidate or dissolve, or enter into any consolidation, merger, partnership, joint 7 venture or other combination except for joint ventures, strategic alliances, ------ licensing and similar arrangements customary in Borrower's industry for businesses in the development stage of Borrower and which do not require Borrower to assume or otherwise become liable for the obligations of any third party not directly related to or arising out of such arrangement or, without the prior written consent of Lender, require Borrower to transfer ownership of assets to such joint venture or other entity; prepay any subordinated debt, debt for borrowed money, or debt secured by any Permitted Lien, or enter into or modify any agreement as a result of which the terms of payment of any such debt are accelerated. 6.5 SALES OF ASSETS. Sell, transfer, lease or otherwise dispose of any of Borrower's assets except for fair consideration and in the ordinary course of its business or obsolete or worn assets. 6.6 LOANS/INVESTMENTS. Make or suffer to exist any loans, guaranties, advances, or investments, except: (a) Accounts receivable in the ordinary course of Borrower's business; (b) Investments in domestic certificates of deposit issued by, and other domestic investments with, financial institutions organized under the laws of the United States or a state thereof, having One Hundred Million Dollars ($100,000,000) in capital and a rating of at least "investment grade" or "A" by Moody's or any successor rating agency;" (c) Investments in marketable obligations of the United States of America and in open market commercial paper given the highest credit rating by a national credit agency and maturing not more than one year from the creation thereof; (d) Temporary advances to cover incidental expenses to be incurred in the ordinary course of business; (e) Loans to a Person or guaranties of Indebtedness of a Person not to exceed Two Hundred Fifty Thousand Dollars ($250,000) for any one Person and One Million Dollars ($1,000,000) in aggregate with respect to all Persons, outstanding at any time. 6.7 TRANSACTIONS WITH RELATED PERSONS. Directly or indirectly enter into any transaction with or for the benefit of a Related Person on terms more favorable to the Related Person than would have been obtainable in an "arms' length" dealing. 6.8 OTHER BUSINESS. Engage in any material line of business other than the business Borrower conducts as of the Closing Date. ARTICLE 7 - EVENTS OF DEFAULT 7.1 EVENTS OF DEFAULT; ACCELERATION. Upon the occurrence and during the continuation of any Default, the obligation of Lender to make any additional Loans shall be suspended. The occurrence of any of the following (each, an "Event of Default") shall terminate any obligation of Lender to make any additional Loan and shall, at the option of Lender (1) make all sums of Basic Interest and principal, all Terminal Payments, and any Obligations and other amounts owing under any Loan Documents immediately due and payable without notice of default, presentment or demand for payment, protest or notice of nonpayment or dishonor or any other notices or demands, and (2) give Lender the right to exercise any other right or remedy provided by contract or applicable law: (a) Borrower shall fail to pay any principal, interest or Terminal Payment under this Agreement, or fail to pay any fees or other charges when due under any Loan Document, and such failure continues for three (3) Business Days or more after the same first becomes due; or an Event of Default as defined in any other Loan Document shall have occurred. (b) Any representation or warranty made, or financial statement, certificate or other document provided, by Borrower under any Loan Document shall prove to have been false or misleading in any material respect when made or deemed made herein. (c) Borrower shall fail to pay its debts generally as they become due or shall commence any Insolvency Proceeding with respect to itself; an involuntary Insolvency Proceeding shall be filed against Borrower, or a custodian, receiver, trustee, assignee for the benefit of creditors, or other similar official, shall be appointed to take possession, custody or control of the properties of Borrower, and such involuntary Insolvency Proceeding, petition or appointment is acquiesced to by Borrower or is not dismissed within sixty (60) days; or the dissolution or termination of the business of Borrower. 8 (d) Borrower shall be in default beyond any applicable period of grace or cure under any other agreement involving the borrowing of money, the purchase of property, the advance of credit or any other monetary liability of any kind to Lender or to any Person which results in the acceleration of payment of such obligation in an amount in excess of the Threshold Amount. (e) Any governmental or regulatory authority shall take any judicial or administrative action, or any defined benefit pension plan maintained by Borrower shall have any unfunded liabilities, any of which, in the reasonable judgment of Lender, would have a Material Adverse Effect. (f) Any sale, transfer or other disposition of all or a substantial or material part of the assets of Borrower, including without limitation to any trust or similar entity, shall occur. (g) Any judgment(s) singly or in the aggregate in excess of the Threshold Amount shall be entered against Borrower which remain unsatisfied, unvacated or unstayed pending appeal for thirty (30) or more days after entry thereof. (h) Any Person or two or more Persons acting in concert shall have acquired beneficial ownership (within the meaning of Rule 13d-3 of the Securities and Exchange Commission) of forty percent (40%) or more of the outstanding shares of voting stock of Borrower. (i) Borrower shall fail to perform or observe any covenant contained in Article 6 of this Agreement. (j) Borrower shall fail to perform or observe any covenant contained in this Agreement or any other Loan Document (other than a covenant which is dealt with specifically elsewhere in this Article 7) and the breach of such covenant is not cured within 30 days after the sooner to occur of Borrower's receipt of notice of such breach from Lender or the date on which such breach first becomes known to any officer of Borrower; provided, however that if such breach is not capable -------- ------- of being cured within such 30-day period and Borrower timely notifies Lender of such fact and Borrower diligently pursues such cure, then the cure period shall be extended to the date requested in Borrower's notice but in no event more than 90 days from the initial breach; provided, further, that such additional 60-day -------- ------- opportunity to cure shall not apply in the case of any failure to perform or observe any covenant which has been the subject of a prior failure within the preceding 180 days or which is a willful and knowing breach by Borrower. 7.2 REMEDIES UPON DEFAULT. Upon the occurrence and during the continuance of an Event of Default, Lender shall be entitled to, at its option, exercise any or all of the rights and remedies available to a secured party under the Uniform Commercial Code or any other applicable law, and exercise any or all of its rights and remedies provided for in this Agreement and in any other Loan Document. The obligations of Borrower under this Agreement shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any Obligations is rescinded or must otherwise be returned by Lender upon, on account of, or in connection with, the insolvency, bankruptcy or reorganization of Borrower or otherwise, all as though such payment had not been made. 7.3 SALE OF COLLATERAL. Upon the occurrence and during the continuance of an Event of Default, Lender may sell all or any part of the Collateral, at public or private sales, to itself, a wholesaler, retailer or investor, for cash, upon credit or for future delivery, and at such price or prices as could reasonably be deemed commercially reasonable under the circumstances. To the extent permitted by law, Borrower hereby specifically waives all rights of redemption and any rights of stay or appraisal which it has or may have under any applicable law in effect from time to time. Any such public or private sales shall be held at such times and at such place(s) as Lender may determine. In case of the sale of all or any part of the Collateral on credit or for future delivery, the Collateral so sold may be retained by Lender until the selling price is paid by the purchaser, but Lender shall not incur any liability in case of the failure of such purchaser to pay for the Collateral and, in case of any such failure, such Collateral may be resold. Lender may, instead of exercising its power of sale, proceed to enforce its security interest in the Collateral by seeking a judgment or decree of a court of competent jurisdiction. Without limiting the generality of the foregoing, if an Event of Default is in effect, (1) Subject to the rights of any third parties, Lender may license, or sublicense, whether general, special or otherwise, and whether on an exclusive or non-exclusive basis, any Patents or Trademarks included in the Collateral throughout the world for such term or terms, on such conditions and in such manner as Lender shall in its sole discretion determine; 9 (2) Lender may (without assuming any obligations or liability thereunder), at any time and from time to time, enforce (and shall have the exclusive right to enforce) against any licensee or sublicensee all rights and remedies of Borrower in, to and under any Patent Licenses or Trademark Licenses and take or refrain from taking any action under any thereof, and Borrower hereby releases Lender from, and agrees to hold Lender free and harmless from and against any claims arising out of, any lawful action so taken or omitted to be taken with respect thereto other than claims arising out of Lender's gross negligence or willful misconduct; and (3) Upon request by Lender, Borrower will execute and deliver to Lender a power of attorney, in form and substance reasonably satisfactory to Lender for the implementation of any lease, assignment, license, sublicense, grant of option, sale or other disposition of a Patent or Trademark. In the event of any such disposition pursuant to this clause 3, Borrower shall supply its know-how -------- and expertise relating to the products or services made or rendered in connection with Patents, the manufacture and sale of the products bearing Trademarks, and its customer lists and other records relating to such Patents or Trademarks and to the distribution of said products, to Lender. 7.4 BORROWER'S OBLIGATIONS UPON DEFAULT. Upon the request of Lender after the occurrence and during the continuance of an Event of Default, Borrower will: (A) Assemble and make available to Lender the Collateral at such place(s) as Lender shall reasonably designate, segregating all Collateral so that each item is capable of identification; and (B) Subject to the rights of any lessor, permit Lender, by Lender's officers, employees, agents and representatives, to enter any premises where any Collateral is located, to take possession of the Collateral, to complete the processing, manufacture or repair of any Collateral, and to remove the Collateral, or to conduct any public or private sale of the Collateral, all without any liability of Lender for rent or other compensation for the use of Borrower's premises. ARTICLE 8 - SPECIAL COLLATERAL PROVISIONS 8.1 COMPROMISE AND COLLECTION. Borrower and Lender recognize that setoffs, counterclaims, defenses and other claims may be asserted by obligors with respect to certain of the Rights to Payment; that certain of the Rights to Payment may be or become uncollectible in whole or in part; and that the expense and probability of success of litigating a disputed Right to Payment may exceed the amount that reasonably may be expected to be recovered with respect to such Right to Payment. Borrower hereby authorizes Lender, after and during the continuance of an Event of Default, to compromise with the obligor, accept in full payment of any Right to Payment such amount as Lender shall negotiate with the obligor, or abandon any Right to Payment. Any such action by Lender shall be considered commercially reasonable so long as Lender acts in good faith based on information known to it at the time it takes any such action. 8.2 PERFORMANCE OF BORROWER'S OBLIGATIONS. Upon the occurrence and during the continuance of an Event of Default, without having any obligation to do so, upon reasonable prior notice to Borrower, Lender may perform or pay any obligation which Borrower has agreed to perform or pay under this Agreement, including, without limitation, the payment or discharge of taxes or Liens levied or placed on or threatened against the Collateral. In so performing or paying, Lender shall determine the action to be taken and the amount necessary to discharge such obligations. Borrower shall reimburse Lender on demand for any amounts paid by Lender pursuant to this Section, which amounts shall constitute Obligations secured by the Collateral and shall bear interest. 8.3 POWER OF ATTORNEY. For the purpose of protecting and preserving the Collateral and Lender's rights under this Agreement, Borrower hereby irrevocably appoints Lender, with full power of substitution, as its attorney-in-fact with full power and authority, after the occurrence and during the continuance of an Event of Default, to do any act which Borrower is obligated to do hereunder; to exercise such rights with respect to the Collateral as Borrower might exercise; to use such Inventory, Equipment, Fixtures or other property as Borrower might use; to enter Borrower's premises; to give notice of Lender's security interest in, and to collect the Collateral; and to execute and file in Borrower's name any financing statements, amendments and 10 continuation statements necessary or desirable to perfect or continue the perfection of Lender's security interests in the Collateral. Borrower hereby ratifies all that Lender shall lawfully do or cause to be done by virtue of this appointment. 8.4 AUTHORIZATION FOR LENDER TO TAKE CERTAIN ACTION. The power of attorney created in Section 8.3 is a power coupled with an interest and shall be irrevocable. The powers conferred on Lender hereunder are solely to protect its interests in the Collateral and shall not impose any duty upon Lender to exercise such powers. Lender shall be accountable only for amounts that it actually receives as a result of the exercise of such powers and in no event shall Lender or any of its directors, officers, employees, agents or representatives be responsible to Borrower for any act or failure to act, except for gross negligence or willful misconduct. After the occurrence and during the continuance of an Event of Default, Lender may exercise this power of attorney without notice to or assent of Borrower, in the name of Borrower, or in Lender's own name, from time to time in Lender's sole discretion and at Borrower's expense. To further carry out the terms of this Agreement, after the occurrence and during the continuance of an Event of Default, Lender may: (A) Execute any statements or documents or take possession of, and endorse and collect and receive delivery or payment of, any checks, drafts, notes, acceptances or other instruments and documents constituting Collateral, or constituting the payment of amounts due and to become due or any performance to be rendered with respect to the Collateral. (B) Sign and endorse any invoices, freight or express bills, bills of lading, storage or warehouse receipts; drafts, certificates and statements under any commercial or standby letter of credit relating to Collateral; assignments, verifications and notices in connection with Accounts; or any other documents relating to the Collateral, including without limitation the Records. (C) Use or operate Collateral or any other property of Borrower for the purpose of preserving or liquidating Collateral. (D) File any claim or take any other action or proceeding in any court of law or equity or as otherwise deemed appropriate by Lender for the purpose of collecting any and all monies due or securing any performance to be rendered with respect to the Collateral. (E) Commence, prosecute or defend any suits, actions or proceedings or as otherwise deemed appropriate by Lender for the purpose of protecting or collecting the Collateral. In furtherance of this right, upon the occurrence and during the continuance of an Event of Default, Lender may apply for the appointment of a receiver or similar official to operate Borrower's business. (F) Prepare, adjust, execute, deliver and receive payment under insurance claims, and collect and receive payment of and endorse any instrument in payment of loss or returned premiums or any other insurance refund or return, and apply such amounts at Lender's sole discretion, toward repayment of the Obligations or replacement of the Collateral. 8.5 APPLICATION OF PROCEEDS. Any Proceeds and other monies or property received by Lender pursuant to the terms of this Agreement or any Loan Document may be applied by Lender first to the payment of expenses of collection, including without limitation reasonable attorneys' fees, and then to the payment of the Obligations in such order of application as Lender may elect. 8.6 DEFICIENCY. If the Proceeds of any disposition of the Collateral are insufficient to cover all costs and expenses of such sale and the payment in full of all the Obligations, plus all other sums required to be expended or distributed by Lender, then Borrower shall be liable for any such deficiency. 8.7 LENDER TRANSFER. Upon the transfer of all or any part of the Obligations, Lender may transfer all or part of the Collateral and shall be fully discharged thereafter from all liability and responsibility with respect to such Collateral so transferred, and the transferee shall be vested with all the rights and powers of Lender hereunder with respect to such Collateral so transferred, but with respect to any Collateral not so transferred, Lender shall retain all rights and powers hereby given. 8.8 LENDER'S DUTIES. (A) Lender shall use reasonable care in the custody and preservation of any Collateral in its possession. Without limitation on other conduct which may be considered the exercise of reasonable care, Lender shall be deemed to have exercised reasonable 11 care in the custody and preservation of such Collateral if such Collateral is accorded treatment substantially equal to that which Lender accords its own property, it being understood that Lender shall not have any responsibility for ascertaining or taking action with respect to calls, conversions, exchanges, maturities, declining value, tenders or other matters relative to any Collateral, regardless of whether Lender has or is deemed to have knowledge of such matters; or taking any necessary steps to preserve any rights against any Person with respect to any Collateral. Under no circumstances shall Lender be responsible for any injury or loss to the Collateral, or any part thereof, arising from any cause beyond the reasonable control of Lender. (B) Lender may at any time deliver the Collateral or any part thereof to Borrower and the receipt of Borrower shall be a complete and full acquittance for the Collateral so delivered, and Lender shall thereafter be discharged from any liability or responsibility therefor. (C) Neither Lender, nor any of its directors, officers, employees, agents, attorneys or any other person affiliated with or representing Lender shall be liable for any claims, demands, losses or damages, of any kind whatsoever, made, claimed, incurred or suffered by Borrower or any other party through the ordinary negligence of Lender, or any of its directors, officers, employees, agents, attorneys or any other person affiliated with or representing Lender. 8.9 TERMINATION OF SECURITY INTERESTS. Upon the payment in full of the Obligations and if Lender has no further obligations under its Commitment, the security interest granted hereby shall terminate and all rights to the Collateral shall revert to Borrower. Upon any such termination, the Lender shall, at Borrower's expense, execute and deliver to Borrower such documents as Borrower shall reasonably request to evidence such termination. ARTICLE 9 - GENERAL PROVISIONS 9.1 NOTICES. Any notice given by any party under any Loan Document shall be in writing and personally delivered, sent by overnight courier, or United States mail, postage prepaid, or sent by facsimile, or other authenticated message, charges prepaid, to the other party's or parties' addresses shown on the Supplement. Each party may change the address or facsimile number to which notices, requests and other communications are to be sent by giving written notice of such change to each other party. Notice given by hand delivery shall be deemed received on the date delivered; if sent by overnight courier, on the next business day after delivery to the courier service; if by first class mail, on the third business day after deposit in the U.S. Mail; and if by facsimile, on the date of transmission. 9.2 BINDING EFFECT. The Loan Documents shall be binding upon and inure to the benefit of Borrower and Lender and their respective successors and assigns; provided, however, that Borrower may not assign or transfer Borrower's rights or obligations under any Loan Document without Lender's prior written consent. Lender reserves the right to sell, assign, transfer, negotiate or grant participations in all or any part of, or any interest in, Lender's rights and obligations under the Loan Documents. In connection with any of the foregoing, Lender may disclose all documents and information which Lender now or hereafter may have relating to the Loans, Borrower, or its business; provided that any person who receives such information shall have agreed in writing in advance to maintain the confidentiality of such information on terms reasonably acceptable to Borrower. 9.3 NO WAIVER. Any waiver, consent or approval by Lender of any Event of Default or breach of any provision, condition, or covenant of any Loan Document must be in writing and shall be effective only to the extent set forth in writing. No waiver of any breach or default shall be deemed a waiver of any later breach or default of the same or any other provision of any Loan Document. No failure or delay on the part of Lender in exercising any power, right, or privilege under any Loan Document shall operate as a waiver thereof, and no single or partial exercise of any such power, right, or privilege shall preclude any further exercise thereof or the exercise of any other power, right or privilege. Lender has the right at its sole option to continue to accept interest and/or principal payments due under the Loan Documents after default, and such acceptance shall not constitute a waiver of said default or an extension of the Maturity Date unless Lender agrees otherwise in writing. 9.4 RIGHTS CUMULATIVE. All rights and remedies existing under the Loan Documents are cumulative to, and not exclusive of, any other rights or remedies available under contract or applicable law. 12 9.5 UNENFORCEABLE PROVISIONS. Any provision of any Loan Document executed by Borrower which is prohibited or unenforceable in any jurisdiction, shall be so only as to such jurisdiction and only to the extent of such prohibition or unenforceability, but all the remaining provisions of any such Loan Document shall remain valid and enforceable. 9.6 ACCOUNTING TERMS. Except as otherwise provided in this Agreement, accounting terms and financial covenants and information shall be determined and prepared in accordance with GAAP. 9.7 INDEMNIFICATION; EXCULPATION. Borrower shall pay and protect, defend and indemnify Lender and Lender's employees, officers, directors, shareholders, affiliates, correspondents, agents and representatives (other than Lender, collectively "Agents") against, and hold Lender and each such Agent harmless from, all claims, actions, proceedings, liabilities, damages, losses, expenses (including, without limitation, attorneys' fees and costs) and other amounts incurred by Lender and each such Agent, arising from (i) the matters contemplated by this Agreement or any other Loan Documents or (ii) any contention that Borrower has failed to comply with any law, rule, regulation, order or directive applicable to Borrower's business; PROVIDED, HOWEVER, that this indemnification shall not apply to any of the foregoing incurred solely as the result of Lender's or any Agent's gross negligence or willful misconduct. This indemnification shall survive the payment and satisfaction of all of Borrower's Obligations to Lender. 9.8 REIMBURSEMENT. Borrower shall reimburse Lender for all costs and expenses, including without limitation reasonable attorneys' fees and disbursements expended or incurred by Lender in any arbitration, mediation, judicial reference, legal action or otherwise in connection with (a) the preparation and negotiation of the Loan Documents, (b) the amendment and enforcement of the Loan Documents, including without limitation during any workout, attempted workout, and/or in connection with the rendering of legal advice as to Lender's rights, remedies and obligations under the Loan Documents, (c) collecting any sum which becomes due Lender under any Loan Document, (d) any proceeding for declaratory relief, any counterclaim to any proceeding, or any appeal, or (e) the protection, preservation or enforcement of any rights of Lender. For the purposes of this section, attorneys' fees shall include, without limitation, fees incurred in connection with the following: (1) contempt proceedings; (2) discovery; (3) any motion, proceeding or other activity of any kind in connection with an Insolvency Proceeding; (4) garnishment, levy, and debtor and third party examinations; and (5) postjudgment motions and proceedings of any kind, including without limitation any activity taken to collect or enforce any judgment. All of the foregoing costs and expenses shall be payable upon demand by Lender, and if not paid within forty-five (45) days of presentation of invoices shall bear interest at the highest applicable Default Rate. 9.9 EXECUTION IN COUNTERPARTS. This Agreement may be executed in any number of counterparts which, when taken together, shall constitute but one agreement. 9.10 ENTIRE AGREEMENT. The Loan Documents are intended by the parties as the final expression of their agreement and therefore contain the entire agreement between the parties and supersede all prior understandings or agreements concerning the subject matter hereof. This Agreement may be amended only in a writing signed by Borrower and Lender. 9.11 GOVERNING LAW AND JURISDICTION. (a) THIS AGREEMENT AND THE LOAN DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF CALIFORNIA. (b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF CALIFORNIA OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF CALIFORNIA, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF BORROWER AND LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF BORROWER AND LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. BORROWER AND LENDER EACH 13 WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY CALIFORNIA LAW. 9.12 WAIVER OF JURY TRIAL. BORROWER AND LENDER EACH WAIVES ITS RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. BORROWER AND LENDER EACH AGREES THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEMS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS. ARTICLE 10 - DEFINITIONS The definitions appearing in this Agreement or any Supplement shall be applicable to both the singular and plural forms of the defined terms: "ACCOUNT DEBTOR" means the Person obligated upon an Account. "ACCOUNTS" means (i) all rights to the payment of money now owned or hereafter acquired by Borrower, whether due or to become due and whether or not earned by performance, including but not limited to, accounts, chattel paper, instruments, and general intangibles; and (ii) for purposes of this Agreement amounts to become payable by existing subscribers to Borrower's database services with respect to subscriptions which are eligible or scheduled for renewal within ninety (90) days after any date of determination of Eligible Accounts. "AFFILIATE" means any Person which directly or indirectly controls, is controlled by, or is under common control with Borrower. "Control," "controlled by" and "under common control with" mean direct or indirect possession of the power to direct or cause the direction of management or policies (whether through ownership of voting securities, by contract or otherwise); provided, that control shall be conclusively presumed when any Person or affiliated group directly or indirectly owns five percent (5%) or more of the securities having ordinary voting power for the election of directors of a corporation. "AGREEMENT" means this Loan and Security Agreement and each Supplement thereto, as each may be amended or supplemented from time to time. "BANKRUPTCY CODE" means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C. (S)101, et seq.), as amended. -- --- "BASIC INTEREST" means the fixed rate of interest payable on the outstanding balance of each Loan at the applicable Designated Rate. "BORROWING DATE" means the Business Day on which the proceeds of a Loan are disbursed by Lender. "BORROWING REQUEST" means a written request from Borrower in substantially the form of Exhibit "B" to the Supplement, requesting the funding of one or more ----------- Loans on a particular Borrowing Date. "BUSINESS DAY" means any day other than a Saturday, Sunday or other day on which commercial banks in New York City or San Francisco are authorized or required by law to close. "CLOSING DATE" means the date of this Agreement. "COLLATERAL" means all Debtor's Accounts, Deposit Accounts, Equipment, Fixtures, General Intangibles, Goods, Inventory, Rights to Payment, and securities now owned or hereafter acquired, wherever located, and whether held by Debtor or any third party, and all royalties, proceeds and products thereof, including all insurance and condemnation proceeds ("Proceeds"), and all Records. 14 "COMMITMENT" means the obligation of Lender to make Loans to Borrower up to the aggregate principal amount set forth in the Supplement. "DEFAULT" means an event which with the giving of notice, passage of time, or both would constitute an Event of Default. "DEFAULT RATE" is defined in Section 2.7. "DEPOSIT ACCOUNTS" means all Borrower's demand, time, savings, passbook or similar accounts maintained with a financial institution or credit union. "DESIGNATED RATE" means the rate of interest per annum described in the Supplement as being applicable to an outstanding Loan from time to time. "ELIGIBLE ACCOUNT" shall mean an Account: (A) Arising from the sale or lease of goods, or the licensing of data, or the performance of services by Borrower in the ordinary course of Borrower's business; (B) Against which is asserted no defense, counterclaim, discount, or setoff; (C) That is an accurate statement of the indebtedness incurred by the Account Debtor; (D) Owned by Borrower free and clear of all liens, rights, claims, and interests of others except security interests in favor of Lender; (E) That does not arise from a sale or lease to or performance of services for an individual or entity employed by or having common ownership with Borrower; F) That is not in default. An Account shall be deemed in default upon the occurrence of any of the following: (I) The Account is not paid or payable within a ninety (90)-day period starting from the original invoice date; (II) The Account Debtor suspends business, becomes insolvent, or fails to pay its debts generally as they come due; or (III) Any petition is filed by or against the Account Debtor under the Bankruptcy Reform Act, Title 11 of the United States Code or under any other law relating to bankruptcy, insolvency, reorganization or other relief for debtors. (G) That is not the obligation of an Account Debtor that is the federal government, any state or political subdivision thereof, unless Borrower has complied in form and substance satisfactory to Lender with the Assignment of Claims Act(s) or any successor thereof in effect from time to time, or other applicable law(s) or regulation(s); (H) That is not the obligation of an Account Debtor located in a foreign country, unless Lender consents in writing and the Account is insured by the Foreign Credit Insurance Association or covered by a letter of credit issued or confirmed by a bank located in the United States of America acceptable to Lender, each such insurance policy or letter of credit being in form and substance satisfactory to Lender; and (I) That is otherwise acceptable to Lender. "ENVIRONMENTAL LAWS" means all federal, state or local laws, statutes, common law duties, rules, regulations, ordinances and codes, together with all administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any governmental authorities, in each case relating to environmental, health, or safety matters. "EQUIPMENT" means all of Borrower's equipment now owned or hereafter acquired, including but not limited to machinery, machine parts, furniture, furnishings and all tangible personal property used in the business of Borrower and all such property which is or is to become fixtures on real property, and all improvements, replacements, accessions and additions thereto, wherever located, and all proceeds thereof arising from the sale, lease, rental or other use or disposition of any such property, including all rights to payment with respect to insurance or condemnation, returned premiums, or any cause of action relating to any of the foregoing. "EVENT OF DEFAULT" means any event described in Section 7.1. 15 "FIXTURES" means all items of personal property of Borrower that are so related to the real property upon which they are located that an interest in them arises under real property law, and improvements, replacements, parts, accessions and additions thereto, and substitutions therefor. "GAAP" means generally accepted accounting principles and practices consistent with those principles and practices promulgated or adopted by the Financial Accounting Standards Board and the Board of the American Institute of Certified Public Accountants, their respective predecessors and successors. Each accounting term used but not otherwise expressly defined herein shall have the meaning given it by GAAP. "GENERAL INTANGIBLES" means all personal property of Borrower, other than Goods, not otherwise defined as Collateral, including without limitation all interests or claims in insurance policies; literary property; trade names, trade name rights; Trademarks, Trademark rights, copyrights, Patents, and all applications therefor; licenses, permits, franchises and like privileges or rights issued by any governmental or regulatory authority; income tax refunds; customer lists; claims and causes of action (whether in contract, tort or otherwise), judgments and all guaranty claims, leasehold interests in personal property, security interests or other security held by or guaranteed to the Borrower to secure the payment by an account debtor of any of the Accounts. "GOODS" means all money and other personal property of Borrower, other than General Intangibles, not otherwise defined as Collateral. "INDEBTEDNESS" of any Person means at any date, without duplication and without regard to whether matured or unmatured, absolute or contingent: (i) all Obligations of such Person for borrowed money; (ii) all Obligations of such Person evidenced by bonds, debentures, notes, or other similar instruments; (iii) all obligations of such Person to pay the deferred purchase price of property or services, except trade accounts payable arising in the ordinary course of business; (iv) all obligations of such Person as lessee under capital leases; (v) all obligations of such Person to reimburse or prepay any bank or other Person in respect of amounts paid under a letter of credit, banker's acceptance, or similar instrument, whether drawn or undrawn; (vi) all obligations of such Person to purchase securities which arise out of or in connection with the sale of the same or substantially similar securities; (vii) all obligations of such Person to purchase, redeem, exchange, convert or otherwise acquire for cash on a present or deferred basis any capital stock of such Person or any warrants, rights or options to acquire such capital stock, now or hereafter outstanding, except to the extent that such obligations remain performable solely at the option of such Person; (viii) all obligations to repurchase assets previously sold (including any obligation to repurchase any accounts or chattel paper under any factoring, receivables purchase, or similar arrangement); (ix) obligations of such Person under interest rate swap, cap, collar or similar hedging arrangements; and (x) all obligations of others of any type described in clause (i) through clause (ix) above guaranteed by such Person. "INSOLVENCY PROCEEDING" means (a) any case, action or proceeding before any court or other governmental authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, or (b) any general assignment for the benefit of creditors, composition, marshalling of assets for creditors, or other, similar arrangement in respect of its creditors generally or any substantial portion of its creditors, undertaken under U.S. Federal, state or foreign law, including the Bankruptcy Code. "INVENTORY" means all Borrower's raw materials, advertising, packaging and shipping materials, work in process, finished goods and goods held for sale or lease or furnished under contracts of service, and all returned and repossessed goods, and all goods covered by documents of title, including warehouse receipts, bills of lading and all other documents of every type covering all or any part of the Collateral. "LIEN" means any voluntary or involuntary security interest, mortgage, pledge, claim, charge, encumbrance, title retention agreement, or third party interest, covering all or any part of the property of Borrower or any other Person. "LOAN" means any Term Loan or Equipment Loan. "LOAN DOCUMENTS" means, individually and collectively, this Loan and Security Agreement, the Supplement, each Note, and any other security or pledge agreement(s), any Warrants issued by Borrower in connection with this Agreement, and all other contracts, instruments, addenda and documents executed in connection with this Agreement or the 16 extensions of credit which are the subject of this Agreement. "MATERIAL ADVERSE EFFECT" or "MATERIAL ADVERSE CHANGE" means (a) a material adverse change in, or a material adverse effect upon, the operations, business, properties, or condition (financial or otherwise) of Borrower; (b) a material impairment of the ability of Borrower to perform under any Loan Document; or (c) a material adverse effect upon the legality, validity, binding effect or enforceability against Borrower of any Loan Document. "MATURITY DATE" means, with regard to a Loan, the earlier of (i) its maturity by reason of acceleration, or (ii) its stated maturity date; and is the date on which payment of all outstanding principal, accrued interest, and the Terminal Payment with respect to such Loan is due. "NOTE" means a promissory note substantially in the form attached to the Supplement as Exhibit "A", executed by Borrower evidencing each Loan. ----------- "OBLIGATIONS" means all debts, obligations and liabilities of Borrower to Lender currently existing or now or hereafter made, incurred or created under, pursuant to or in connection with this Agreement, whether voluntary or involuntary and however arising or evidenced, whether direct or acquired by Lender by assignment or succession, whether due or not due, absolute or contingent, liquidated or unliquidated, determined or undetermined, and whether Borrower may be liable individually or jointly, or whether recovery upon such debt may be or become barred by any statute of limitations or otherwise unenforceable; and all renewals, extensions and modifications thereof; and all attorneys' fees and costs incurred by Lender in connection with the collection and enforcement thereof as provided for in any Loan Document. "PATENT LICENSE" means any written agreement now or hereafter in existence granting to Borrower any right to make, use, sell or practice any invention on which a Patent is in existence. "PATENTS" means all of the following: (i) all letters patent of the United States or any other country, all registrations and recordings thereof, and all applications for letters patent of the United States or any other country, including, without limitation, registrations, recordings and applications in the United States Patent and Trademark Office or in any similar office or agency of the United States, any state thereof or any other country or any political subdivision thereof, and (ii) all reissues, divisions, continuations, continuations-in-part, renewals or extensions thereof. "PATENT COLLATERAL ASSIGNMENT" means any Patent Collateral Assignment executed and delivered by Borrower in favor of Lender, as the same may be amended from time to time. "PERMITTED LIEN" means (A) Involuntary Liens which, in the aggregate, would not have a Material Adverse Effect and which in any event would not the Threshold Amount; (B) Liens for current taxes or other governmental or regulatory assessments which are not delinquent, or which are contested in good faith by the appropriate procedures and for which appropriate reserves are maintained; (C) security interests on any property held or acquired by Borrower in the ordinary course of business securing Indebtedness incurred or assumed for the purpose of financing all or any part of the cost of acquiring such property; provided, that such Lien attaches solely to the property acquired with such - -------- Indebtedness and that the principal amount of such Indebtedness does not exceed one hundred percent (100%) of the cost of such property; and further provided, ------- -------- that such property is not equipment with respect to which a Loan has been made hereunder. (D) Liens in favor of Lender or Venture Lending & Leasing, Inc.; (E) bankers' liens, rights of setoff and similar Liens incurred on deposits made in the ordinary course of business; (F) materialmen's, mechanics', repairmen's, employees' or other like Liens arising in the ordinary course of business and which are not delinquent for more than 45 days or are being contested in good faith by appropriate proceedings; (G) any judgment, attachment or similar Lien, unless the judgment it secures has not been discharged or execution thereof effectively stayed and bonded against pending appeal within 30 days of the entry thereof; (H) licenses or sublicenses of Patents, Patent Licenses, Trademarks or Trademark Licenses 17 permitted under the Trademark Collateral Assignment or the Patent Collateral Assignment; and. (I) Liens which have been approved by Lender in writing prior to the Closing Date. "PERSON" means any individual or entity. "QUALIFIED PUBLIC OFFERING" means the closing of a firmly underwritten public offering of Borrower's common stock with aggregate proceeds of not less than $10,000,000 (prior to underwriting expenses and commissions). "RECORDS" means all Borrower's computer programs, software, hardware, source codes and data processing information, all written documents, books, invoices, ledger sheets, financial information and statements, and all other writings concerning Borrower's business. "RELATED PERSON" means any Affiliate of Borrower, or any officer, employee, director or equity security holder of Borrower or any Affiliate. "RIGHTS TO PAYMENT" means all Borrower's accounts, instruments, contract rights, documents, chattel paper and all other rights to payment, including, without limitation, the Accounts, all negotiable certificates of deposit and all rights to payment under any Patent License, any Trademark License, or any commercial or standby letter of credit. "TERMINAL PAYMENT" means, with respect to each Loan, an amount payable on the Maturity Date of such Loan in an amount equal to that percentage of the original principal amount of such Loan specified in the Supplement. "TERMINATION DATE" has the meaning specified in the Supplement. "THRESHOLD AMOUNT" has the meaning specified in the Supplement. "TRADEMARK LICENSE" means any written agreement now or hereafter in existence granting to Borrower any right to use any Trademark. "TRADEMARKS" means all of the following: (i) all trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service marks, logos, other source or business identifiers, prints and labels on which any of the foregoing have appeared or will appear, designs and general intangibles of like nature, now existing or hereafter adopted or acquired, all registrations and recordings thereof, and all applications in connection therewith, including, without limitation, registrations, recordings and applications in the United States Patent and Trademark Office or in any similar office or agency of the United States, any state thereof or any other country or any political subdivision thereof, and (ii) all reissues, divisions, continuations, continuations-in-part, renewals or extensions thereof. "TRADEMARK COLLATERAL ASSIGNMENT" means any Trademark Collateral Assignment executed and delivered by Borrower in favor of Lender, as the same may be amended from time to time. "UCC" means the Uniform Commercial Code as enacted in the applicable jurisdiction, in effect on the Closing Date and as amended from time to time. 18 SUPPLEMENT TO THE LOAN AND SECURITY AGREEMENT DATED AS OF FEBRUARY 12, 1999 BETWEEN COMPS.COM, INC. ("BORROWER") AND VENTURE LENDING & LEASING II, INC. ("LENDER") - -------------------------------------------------------------------------------- This is a Supplement identified in the document entitled Loan and Security Agreement dated as of February 12, 1999 between Borrower and Lender. All capitalized terms used in this Supplement and not otherwise defined in this Supplement have the meanings ascribed to them in Section 10 of the Loan and Security Agreement, which is incorporated in its entirety into this Supplement. In the event of any inconsistency between the provisions of that document and this Supplement, this Supplement is controlling. Execution of this Supplement by the Lender and Borrower shall constitute execution of the Loan and Security Agreement. In addition to the provisions of the Loan and Security Agreement, the parties agree as follows: 1) - ADDITIONAL DEFINITIONS: ------------------------- "BORROWING BASE" means, with respect to any Term Loan as of date of determination, an amount at all times equal the lesser of (a) $1,800,000 minus any Equipment Loans funded hereunder; or (b) eighty percent (80%) of Borrower's Eligible Accounts. "COLLATERAL COVERAGE RATIO" means, as of any date of determination, the ratio of (i) Borrower's total Obligations to Lender then outstanding, to (ii) the sum of (a) 80% of Eligible Accounts. "COMMITMENT": Lender commits to make Term Loans or Equipment Loans to ---------- --------------- Borrower up to the aggregate, original principal amount of One Million Eight Hundred Thousand Dollars ($1,800,000.00). Subject to the limitations set forth in this Supplement and the Loan and Security Agreement, a Loan may be advanced as an Equipment Loan, the proceeds of which shall be used to finance Borrower's acquisition or carrying of computer, research and development and general purpose office equipment; up to fifty percent (50%) of the original principal amount of Equipment Loans advanced may be used to finance software or for tenant improvements at premises leased by Borrower. A Loan may also be advanced as a Term Loan, the proceeds of which shall be used by Borrower for general working capital purposes. Except to the extent the remaining Commitment is a lesser amount, each Equipment Loan requested by Borrower to be made on a single Business Day shall be for a minimum principal amount of $100,000, and each Term Loan requested by Borrower to be made on a single Business Day shall be for a minimum principal amount of $100,000 or a multiple thereof. "DESIGNATED RATE": The Designated Rate is Eight and 75/100 percent (8.75%) per annum. "TERMINAL PAYMENT": Each Terminal Payment shall be an amount equal to Fifteen percent (15%) of the original principal amount of the associated Loan. "TERMINATION DATE": The Termination Date is the earlier of (a) the date Lender may terminate making Loans or extending other credit pursuant to the rights of Lender under Article 7 of the Agreement, or (b) March 31, 2000. "THRESHOLD AMOUNT": One Hundred Thousand Dollars ($100,000.00). Page 1 2) - ADDITIONAL TERMS AND CONDITIONS: ---------------------------------- A. ISSUANCE OF WARRANT TO LENDER. As additional consideration for the making of the Loans under the Agreement, upon the making of, and as a condition to, the initial Loan, Lender shall be entitled to receive a warrant to purchase a number of shares of Class B common stock of Borrower ("Warrant Shares") with an aggregate initial exercise price of $225,000.00 and a per share exercise price that is halfway between the last ($1.8031) and the next round of equity financing. If there is no new equity financing done within the next 18 months of the date of the Loan agreement then the warrant exercise price will equal $2.70. The warrant issued under this Agreement shall be in substantially the form attached hereto as Exhibit "D"; shall be transferable by Lender, subject to ----------- compliance with applicable securities laws; shall expire not earlier than seven years from the date of issue and shall include piggy-back registration rights, "net issuance" provisions, and anti-dilution protections reasonably satisfactory to Lender and its counsel. B. LIMITATION ON REIMBURSEMENT OF DOCUMENTATION COSTS. Notwithstanding anything to the contrary in Section 9.8 of the Loan and Security Agreement, Borrower's obligation to reimburse Lender its attorneys' fees and costs of documenting this transaction shall not exceed $2,000.00 . C. LIMITATION ON EQUIPMENT LOANS. Each Loan shall be in an amount not to exceed one hundred percent (100%) of the amount paid or payable by Borrower to a non-affiliated manufacturer, vendor or dealer for an item of equipment as shown on an invoice therefor (excluding any commissions and any portion of the payment which relates to the servicing of the equipment and sales taxes payable by Borrower upon acquisition, and delivery charges). Lender has the right to approve individual items of Equipment for funding. D. BROKER FEE. Borrower authorizes and directs Lender, and Lender agrees, to remit directly to Mr. Doug Wall on each Borrowing Date two percent (2%) of the proceeds of each Loan, as a broker's fee for the Facilities. E. PREPAYMENT OF LOANS (A) MANDATORY PREPAYMENTS OF TERM LOAN. Borrower agrees that if the aggregate outstanding principal balance of all Term Loans then outstanding on any date exceeds the Borrowing Base on such date, then Borrower if requested by Lender will immediately prepay Term Loans in an amount equal to the excess. (B) MANDATORY PREPAYMENTS OF EQUIPMENT LOANS. Borrower shall be required to prepay any Equipment Loan from the net proceeds of any insurance or condemnation awards paid in respect of the items of equipment financed with the proceeds of such Loan; provided, that such prepayment shall not be required, so -------- long as no Event of Default otherwise exists, (i) if Borrower uses such net proceeds to purchase replacements of equipment lost through casualty or condemnation and such replacement equipment is subject to no Liens other than Lender's, or (ii) with respect to losses of equipment which in aggregate during any consecutive twelve-month period has a fair market value or book value, whichever is more, of $75,000 or less. (C) PREPAYMENTS GENERALLY. No Loan may be voluntarily prepaid except as provided in this subsection (c). Borrower may prepay any Loan, in whole or in part in minimum payments of $50,000 at any time after the first anniversary of the Borrowing Date for such Loan; provided that any prepayment, whether -------- voluntary or involuntary as a result of acceleration or otherwise, must be accompanied by payment of: (i) a premium equal to 2.00% of the amount of principal so prepaid if such prepayment is made during the 12-month period between the first and second anniversaries, or a 1.00% premium if such prepayment is made during the 12-month period between the second and third anniversaries (there being no premium or penalty payable after the third anniversary of the Borrowing Date of such Loan); (ii) accrued Basic Interest to the date of such prepayment; and (iii) all the Terminal Payment on the Loan so prepaid (or a ratable portion of such Terminal Payment, if less than all of the Page 2 Loan is prepaid). Unless otherwise agreed by Lender, any partial prepayment of a Loan shall be applied in inverse order of maturity to the most remote principal installment then unpaid on such Loan. No premium or penalty shall be required in the case of a prepayment of all Loans following Lender's refusal to fund any portion of the Commitment pursuant to Section 4.2(b) or Section 4.2(f). F. COMMITMENT FEE. In consideration of Lender's commitments hereunder, -------------- Borrower shall pay Lender a fee (the "Commitment Fee") in the amount of $12,000. Lender acknowledges prior receipt of the Commitment Fee. G. REDUCTION OF WARRANT AND FEE If Lender has not made Loans in the ---------------------------- aggregate principal amount equal to the aggregate Commitment by March 31, 2000, solely as a result of either the limitation on Lender under Section 4.2(b) or Lender's determination that the condition precedent in Section 4.2(f) has not been satisfied, then the maximum number of shares issuable under the Warrant shall be reduced proportionately based on the ratio of the aggregate principal amount of Loans actually funded over the aggregate Commitment; and Lender shall refund to Borrower a proportionate amount of the Commitment Fee. H. Fundings above $800,000 from this facility will be subject to Borrower's raising an additional $2,000,000 of equity financing from a venture capital firm acceptable to Lender or sign a Letter of Intent to do an IPO or a Mezzanine financing with Venture Capitalist or an Investment Banker acceptable to Lender. 3) - ADDITIONAL REPRESENTATIONS: ----------------------------- Borrower represents and warrants that as of the Closing Date: Its chief executive office is located at: 9888 Carroll Center Rd. San Diego, CA 92126-4580 Its Inventory is located at: same Its Equipment is located at: same Its Records are located at: same In addition to its chief executive office, Borrower maintains offices or operates its business at the following locations: Other than its full corporate name, Debtor has conducted business using the following trade names or fictitious business names: Comps Infosystems, Inc. 4) - ADDITIONAL LOAN DOCUMENTS: ---------------------------- Form of Note Exhibit "A" Form of Borrowing Request Exhibit "B" Form of Compliance Certificate Exhibit "C" Patent Collateral Assignment Exhibit "D" Trademark Collateral Assignment Exhibit "E" Form of Warrant Exhibit "F" Page 3 IN WITNESS WHEREOF, the parties have executed this Supplement as of the date first above written. BORROWER: LENDER: COMPS.COM, INC. VENTURE LENDING & LEASING II INC. By: /s/ C A CRANE By: /s/ SALVADOR O. GUTIERREZ ------------------------- ----------------------------- Name: C A Crane Name: Salvador O. Gutierrez ----------------------- --------------------------- Title: President and CEO Title: President ---------------------- -------------------------- Address for Notices: Attn: Chief Financial Officer Attn: Chief Financial Officer 9888 Carroll Center Rd. 2010 North First Street, Suite 310 San Diego, CA 92126-4580 San Jose, CA, 95131 Fax # (619) 684-3292 Fax # (408)436-8625
Page 4 EXHIBIT "A" ----------- [Note No. X-XXX] FORM OF PROMISSORY NOTE $____________________, _____________________, 199___ San Jose, California The undersigned ("Borrower") promises to pay to the order of VENTURE LENDING & LEASING II, INC., a Maryland corporation ("Lender") at its office at 2010 North First Street, Suite 310, San Jose, California 95131, or at such other place as Lender may designate in writing, in lawful money of the United States of America, the principal sum of _____________________________________ Dollars ($__________), with Basic Interest thereon from the date hereof until maturity, whether scheduled or accelerated, at a fixed rate per annum of ____________ percent (___%), and with a Terminal Payment in the sum of __________[15% of face ------------ amount]__________ Dollars ($__________) payable on the Maturity Date. - ------- This Note is one of the Notes referred to in, and is entitled to all the benefits of, a Loan Agreement dated as of February __, 1999, between Borrower and Lender. Each capitalized term not otherwise defined herein shall have the meaning set forth in the Loan Agreement. The Loan Agreement contains provisions for the acceleration of the maturity of this Note upon the happening of certain stated events. Principal of and interest on this Note shall be payable as follows: (Actual Notes will be for either a Term Loan or an Equipment Loan) TERM LOANS On the Borrowing Date, Borrower shall pay (i) Basic Interest, in advance, on the outstanding principal balance of this Note at the Designated Rate for the period from the Borrowing Date through ___[THE LAST DAY OF THE SAME MONTH]___; -------------------------------- (ii) a first (1st) amortization installment of principal and Basic Interest in the amount of $_________________, in advance for the month of [ first full month ----------------- after Borrowing Date ]; and (iii) a 36th amortization installment of principal - ---------------------- ---- and Basic Interest in the amount of $_________________ in advance for the month of [36th full month after the Borrowing Date]. ---------------------------------------- Commencing on the first day of the second full month after the Borrowing Date, and continuing on the first day of each consecutive month thereafter, principal and Basic Interest shall be payable, in advance, in thirty-three (33) ----------------- equal consecutive installments of ________________________________________ Dollars ($__________) each, with a 34th installment equal to the entire unpaid ---- principal balance and accrued Basic Interest on _______________, 20__. The Terminal Payment amount shall be payable on [first day of 36th full month after ---------------------------------- Borrowing Date]. - -------------- EQUIPMENT LOANS On the Borrowing Date, Borrower shall pay (i) Basic Interest, in advance, on the outstanding principal balance of this Note at the Designated Rate for the period from the Borrowing Date through ___[THE LAST DAY OF THE SAME MONTH]___; -------------------------------- (ii) a first (1st) amortization installment of principal and Basic Interest in the amount of $_________________, in advance for the month of [ first full month ----------------- after Borrowing Date ]; and (iii) a 48th amortization installment of principal - ---------------------- ---- and Basic Interest in the amount of $_________________ in advance for the month of [48th full month after the Borrowing Date]. ---------------------------------------- Commencing on the first day of the second full month after the Borrowing Date, and continuing on the first day of each consecutive month thereafter, principal and Basic Interest shall be payable, in advance, in forty-five (45) --------------- equal consecutive installments of ________________________________________ Dollars ($__________) each, with a 46th installment equal to the entire unpaid ---- principal balance and accrued Basic Interest on _______________, 20__. The Terminal Payment amount shall be payable on [first day of 48th full month after ---------------------------------- Borrowing Date]. - -------------- Any unpaid payments of principal or interest on this Note shall bear interest from their respective maturities, whether scheduled or accelerated, at a rate per annum equal to the Default Rate. Borrower shall pay such interest on demand. Interest, charges and fees shall be calculated for actual days elapsed on the basis of a 360-day year, which results in higher interest, charge or fee payments than if a 365-day year were used. In no event shall Borrower be obligated to pay interest, charges or fees at a rate in excess of the highest rate permitted by applicable law from time to time in effect. This Note shall be governed by, and construed in accordance with, the laws of the State of California. COMPS.COM, INC. By:________________________________ Name: _____________________________ Its:_______________________________ EXHIBIT B BORROWING REQUEST ________________, ____ Venture Lending & Leasing II, Inc. 2010 North First Street, Suite 310 San Jose, CA 95131 Re: COMPS.COM, INC. Gentlemen: Reference is made to the Loan and Security Agreement dated as of February 12, 1999 (as the same have been and may be amended from time to time, the "Loan Agreement", the capitalized terms used herein as defined therein), between Venture Lending & Leasing II, Inc. on one hand and COMPS.COM, INC. (the "Company") on the other. The undersigned is an Officer of the Company, authorized to borrow under The Loan Agreement, and hereby requests Loan under the Loan Agreement, and in that connection certifies as follows: 1. The aggregate amount of the proposed Loan is $____________. The Business Day of the proposed Loan is _____ , 1997. 2. Type of Loan requested is ________________________________. 3. As of this date, no Default or Event of Default has occurred and is continuing, or will result from the making of the proposed Loan, and the representations and warranties of the Company contained in the Loan Agreement are true and correct in all material respects. 4. No Material Adverse Change has occurred since the date of the most recent financial statements submitted to you by the Company. The Company agrees to notify you promptly before the funding of the Loan if any of the matters to which I have certified above shall not be true and correct on the Borrowing Date. Very Truly Yours, By:________________________________ Name: _____________________________ Its:_______________________________ EXHIBIT C COMPLIANCE CERTIFICATE Venture Lending & Leasing II, Inc. 2010 North First Street, Suite 310 San Jose, CA 95131 Re: COMPS.COM, INC. Gentlemen: Reference is made to the two Loan and Security Agreement dated as of February 12, 1999 (as the same have been and may be amended from time to time, the "Loan Agreement", the capitalized terms used herein as defined therein), between Venture Lending & Leasing II, Inc. on one hand and COMPS.COM, INC. (the "Company") on the other. The undersigned authorized representative of the Company hereby certifies that in accordance with the terms and conditions of the Loan Agreement, the Company is in complete compliance for the period ending ___________ with all required conditions and terms except as noted below. Attached herewith are the required documents supporting the above certification. The representative further certifies that these are prepared in accordance with Generally Accepted Accounting Principles and are consistent from one period to the next except as explained below. Indicate compliance status by circling Yes/No under "Complies"
REPORTING REQUIREMENT REQUIRED COMPLIES - --------------------- -------- -------- Interim Financial Statements Monthly within 45 days YES / NO Audited Financial Statements FYE within 120 days YES / NO FINANCIAL COVENANTS REQUIRED COMPLIES - ------------------- -------- -------- Collateral Coverage 80% of Eligible Accounts Receivable YES / NO REQUIRED EXPLANATIONS: - ---------------------
________________________________________________________________________________ ________________________________________________________________________________ Very Truly Yours, By: ______________________________ Name: ____________________________ Its:______________________________ EXHIBIT D See Exhibit 10.47 to Registration Statement on Form S-1 EXHIBIT E See Exhibit 10.48 to Registration Statement on Form S-1 EXHIBIT F See Exhibit 10.49 to Registration Statement on Form S-1 EX-10.47 50 PATENT COLLATERAL ASSIGNMENT AGREEMENT EXHIBIT 10.47 PATENT COLLATERAL ASSIGNMENT ---------------------------- This Agreement is made on the 12th day of February, 1999, between COMPS.COM, Inc. a Delaware corporation, having a mailing address at 9888 Carroll Center Rd., San Diego, CA 92126-4580 ("Assignor"), and Venture Lending & Leasing II, Inc. ("Assignee"). Assignee's address is 2010 North First Street, Suite 310, San Jose, California 95131. RECITALS -------- A. Assignor owns the Patents and Patent applications listed on Schedule 1 ---------- hereto, and is a party to the Patent Licenses listed on Schedule 1 hereto; ---------- B. Assignor and Assignee are parties to a Loan and Security Agreement of even date herewith (as the same may be amended from time to time, the "Loan Agreement"); C. Pursuant to the terms of the Loan Agreement of even date herewith Assignor has granted to Assignee a security interest in certain personal property assets of Assignor, including all right, title and interest of Assignor in, to and under all of Assignor's Patents (as defined in the Loan Agreement), all of Assignor's Patent applications and all of Assignor's Patent Licenses (as defined in the Loan Agreement), whether presently existing or hereafter arising or acquired, and all products and proceeds thereof, including, without limitation, any and all causes of action which may exist by reason of infringement thereof for the full term of the Patents, to secure the payment of the Obligations (as defined in the Loan Agreement); C. Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Loan and Security Agreement. NOW, THEREFORE, in consideration of the premises, Assignor hereby agrees with Assignee as follows: 1. To secure the complete and timely satisfaction of all Obligations, Assignor hereby grants, assigns and conveys to Assignee a continuing security interest in and lien on all of Assignor's entire right, title and interest in and to the Patents, Patent applications and Patent Licenses listed on Schedule 1 ---------- hereto (as the same may be amended pursuant hereto from time to time), including, without limitation, all proceeds thereof (such as, by way of example, license royalties and proceeds of infringements, all rights corresponding thereto throughout the world and all reissues, divisions, continuations, renewals, extensions and continuations-in-part thereof (collectively called the "Patents"). 2. Assignor covenants and warrants that: a) The Patents are subsisting and have not been adjudged invalid or unenforceable, in whole or in part; b) To the best of Assignor's knowledge, each of the Patents is valid and enforceable and Assignor has notified Assignee in writing of all prior art (including public uses and sales) of which it is aware; c) Assignor is the sole and exclusive owner of the entire and unencumbered right, title and interest in and to each of the Patents, free and clear of any liens, charges and encumbrances, including, without limitation, pledges, assignments, licenses, shop rights and covenants by Assignor not to sue third persons, except (i) Permitted Liens; and (ii) any license disclosed in ------ Schedule 1; and - ---------- d) Assignor has the unqualified right to enter into this Agreement and perform its terms. 3. Assignor agrees that, until all of the Obligations shall have been satisfied in full, it will not enter into any agreement (for example, a license agreement) which is inconsistent with Assignor's obligations under this Agreement, without Assignee's prior written consent; provided, that so long as -------- no Default or Event of Default (as defined in the Loan Agreement) shall have occurred and be continuing, Assignor may grant licenses to third parties to use the Patents in the ordinary course of business of both Assignor and such third party on arm's length and customary business terms. 4. If, before the Obligations shall have been satisfied in full, Assignor shall obtain rights to any new patentable inventions, or become entitled to the benefit of any Patent application or Patent for any reissue, division, continuation, renewal, extension, or continuation-in-part of any Patent or any improvement on any Patent, the provisions of paragraph 1 shall automatically apply thereto and Assignor shall give to Assignee prompt notice thereof in writing. 5. Assignor authorizes Assignee unilaterally to modify this Agreement by amending Schedule 1 to include any future Patents and Patent applications ---------- which are Patents under paragraph 1 or paragraph 4 hereof. 6. If any Event of Default (as defined in the Loan Agreement) shall have occurred and be continuing, Assignee shall have, in addition to all other rights and remedies given it by this Agreement or any other Loan Document (as defined in the Loan Agreement), those allowed by law and the rights and remedies of a secured party under the Uniform Commercial Code as enacted in any jurisdiction in which the Patents may be located and, without limiting the generality of the foregoing, Assignee may immediately, without demand of performance and without other notice (except as set forth below) or demand whatsoever to Assignor, all of which are hereby expressly waived, and without advertisement, sell at public or private sale or otherwise realize upon, the whole or from time to time any part of the Patents, or any interest which the Assignor may have therein, and after deducting from the proceeds of sale or other disposition of the Patents all expenses (including reasonable expenses for brokers' fees and legal services), shall apply the residue of such proceeds toward the payment of the Obligations. Any remainder of the proceeds after payment in full of the Obligations shall be paid over to Assignor. Notice of any sale or other disposition of the Patents shall be given to Assignor at least ten (10) days before the time of any intended public or private sale or other disposition of the Patents is to be made, which Assignor hereby agrees shall be reasonable notice of such sale or other disposition. At any such sale or other disposition Assignee may, to the extent permissible under applicable law, purchase the whole or any part of the Patents sold, free from any right of redemption on the part of Assignor, which right is hereby waived and released. 7. Assignor hereby authorizes and empowers Assignee to make, constitute and appoint any officer or agent of Assignee, as Assignee may select in its exclusive discretion, as Assignor's true and lawful attorney-in-fact, with the power, after and during the continuance of an Event of Default, to endorse Assignor's name on all applications, documents, papers and instruments necessary for Assignee to use the Patents, or to grant or issue any exclusive or nonexclusive license under the Patents to any third person, or necessary for Assignee to assign, pledge, convey or otherwise transfer title in or dispose of the Patents to any third person as a part of Assignee's realization on such collateral upon acceleration of the Obligations following an Event of Default. Assignor hereby ratifies all that such attorney shall lawfully do or cause to be done by virtue hereof. This power of attorney being coupled with an interest shall be irrevocable for the life of this Agreement. 8. At such time as Assignor shall completely satisfy all of the Obligations, this Agreement shall terminate and Assignee shall execute and deliver to Assignor all assignments, reconveyances or other instruments as may be reasonably requested by Assignor to re-vest in Assignor full title to the Patents, subject to any disposition thereof which may have been made by Assignee pursuant hereto. 9. Any and all fees, costs and expenses, of whatever kind or nature, including the reasonable attorneys' fees and legal expenses incurred by Assignee in connection with the preparation of this Agreement and all other documents relating hereto and the consummation of this transaction, the filing or recording of any documents (including all taxes in connection therewith) in public offices, the payment or discharge of any taxes, counsel fees, maintenance fees, encumbrances or otherwise protecting, maintaining or preserving the Patents, or in defending or prosecuting any actions or proceedings arising out of or related to the Patents, shall be borne and paid by Assignor on demand by Assignee and until so paid shall be added to the principal amount of the Obligations and shall bear interest at the highest applicable Default Rate (as defined in the Loan Agreement). 10. Assignor shall have the duty, through counsel reasonably acceptable to Assignee, to prosecute diligently any Patent applications pending as of the date of this Agreement or thereafter until the Obligations shall have been paid in full, to make application on unpatented but patentable inventions and to preserve and maintain all rights in Patent applications and Patents, including, without limitation, the payment of all maintenance fees. Any expenses incurred in connection with such an application shall be borne by Assignor. The Assignor shall not abandon any right to file a Patent application, or any pending Patent application or Patent without the consent of Assignee, which consent shall not be unreasonably withheld. 11. Assignor shall have the right, with the consent of Assignee, which shall not be unreasonably withheld, to bring suit in its own name, and to join Assignee, if necessary, as a party to such suit so long as Assignee is satisfied that such joinder will not subject it to any risk of liability, to enforce the Patents. Assignor shall promptly, upon demand, reimburse and indemnify Assignee for all damages, costs and expenses, including reasonable attorneys' fees incurred by Assignee, in accordance with the Loan Agreement. 12. No course of dealing between Assignor and Assignee, nor any failure to exercise, nor any delay in exercising, on the part of Assignee, any right, power or privilege hereunder or under the Loan Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or thereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege. 13. All of Assignee's rights and remedies with respect to the Patents, whether established hereby or by the Loan & SecurityAgreement, Agreement or any other agreements or by law shall be cumulative and may be exercised singularly or concurrently. 14. The provisions of this Agreement are severable, and if any clause or provision shall be held invalid and unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall affect only such clause or provision, or part thereof, in such jurisdiction, and shall not in any manner affect such clause or provision in any other jurisdiction, or any clause or provision of this Agreement in any jurisdiction. 15. This Agreement is subject to modification only by a writing signed by both parties, except as provided in paragraph 5. 16. This Agreement shall be binding upon Assignor and Assignee and their respective permitted successors and assigns, and shall inure to the benefit of Assignor, Assignee and the respective permitted successors and assigns of Assignor and Assignee. 17. The validity and interpretation of this Agreement and the rights and obligations of the parties shall be governed by the laws of the State of California. WITNESS the execution hereof under seal as of the day and year first above written. COMPS.COM, INC. By: /s/ C A CRANE -------------------------- Name: C A Crane ------------------------ Title: CEO ----------------------- VENTURE LENDING & LEASING II, INC By: /s/ SALVADOR O. GUTIERREZ -------------------------- Name: Salvador O. Gutierrez ------------------------ Title: President ----------------------- SCHEDULE 1 TO PATENT COLLATERAL ASSIGNMENT A. PATENTS AND PATENT APPLICATIONS: Application Issue or Expiration or Patent No. Filing Date Date Title - ------------- ----------- ---- ----- B. PATENT LICENSES: Corresponding Date License Termination Patent No. Granted Licensee Date - ------------- ------- -------- ---- EX-10.48 51 TRADEMARK COLLATERAL ASSIGNMENT AGREEMENT EXHIBIT 10.48 TRADEMARK COLLATERAL ASSIGNMENT ------------------------------- THIS AGREEMENT is made on the 12th day of February, 1999, between COMPS.COM, Inc. a Delaware corporation, having a mailing address at 9888 Carroll Center Rd., San Diego, CA 92126-4580 ("Assignor"), and Venture Lending & Leasing II, Inc., ("Assignee"). Assignee's address is 2010 North First Street, Suite 310, San Jose, California 95131. RECITALS -------- A. Assignor owns the Trademarks, Trademark registrations and Trademark applications listed on Schedule 1 hereto, and is a party to the Trademark ---------- Licenses listed on Schedule 1 hereto: ---------- B. Assignor and Assignee are parties to a Loan and Security Agreement of even date herewith (as the same may be amended from time to time, the "Loan Agreement"); C. Pursuant to the terms of the Loan Agreement, Assignor has granted to Assignee a security interest in certain personal property assets of Assignor, including all right, title and interest of Assignor in, to and under all Assignor's Trademarks (as defined in the Loan Agreement), Trademark registrations, Trademark applications and Trademark Licenses (as defined in the Loan Agreement), whether presently existing or hereafter arising or acquired, together with the goodwill of the business symbolized by the Trademarks and the applications therefor and the registrations thereof, and all products and proceeds thereof, including, without limitation, any and all causes of action which may exist by reason of infringement or dilution thereof or injury to the associated goodwill, to secure the payment of all amounts owing under the Loan Agreement. D. Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Loan Agreement. NOW, THEREFORE, in consideration of the premises, Assignor hereby agrees with Assignee as follows: 1. To secure the complete and timely satisfaction of all Obligations (as defined in the Loan Agreement), Assignor hereby grants, assigns and conveys to Assignee a continuing security interest in and lien on all of Assignor's right, title and interest in and to the Trademarks, Trademark applications and Trademark Licenses listed on Schedule 1 hereto (as the same may be amended ---------- pursuant hereto from time to time), including, without limitation, all renewals thereof, all proceeds of infringement suits, the right to sue for past, present and future infringements and all rights corresponding thereto throughout the world (all of the foregoing are collectively called the "Trademarks"), and the goodwill of the business to which each of the Trademarks relates. 2. Assignor covenants and warrants that: a) The Trademarks are subsisting and have not been adjudged invalid or unenforceable; b) To the best of Assignor's knowledge, each of the Trademarks is valid and enforceable; c) No claim has been made that the use of any of the Trademarks does or may violate the rights of any third person; d) Assignor is the sole and exclusive owner of the entire and unencumbered right, title and interest in and to each of the Trademarks, free and clear of any liens, charges and encumbrances, including, without limitation, pledges, assignments, licenses, registered user agreements and covenants by Assignor not to sue third persons, except (i) Permitted Liens; and (ii) any license disclosed in Schedule 1; ---------- e) Assignor has the unqualified right to enter into this Agreement and perform its terms; f) Assignor has used, and will continue to use for the duration of this Agreement, proper statutory notice in connection with its use of the Trademarks; and g) Assignor has used, and will continue to use for the duration of this Agreement, consistent standards of quality in its manufacture of products sold under the Trademarks. 3. Assignor hereby grants to Assignee and its employees and Assignee the right to visit Assignor's plants and facilities which manufacture, inspect or store products sold under any of the Trademarks, and to inspect the products and quality control records relating thereto at reasonable times during regular business hours. Assignor shall do any and all acts required by Assignee to ensure Assignor's compliance with paragraph 2(g). 4. Assignor agrees that, until all of the Obligations shall have been satisfied in full, it will not enter into any agreement (for example, a license agreement) which is inconsistent with Assignor's obligations under this Agreement, without Assignee's prior written consent; provided, that so long as -------- no Default or Event of Default (as defined in the Loan Agreement) shall have occurred and be continuing, Assignor may grant licenses to third parties to use the Trademarks in the ordinary course of business of both Assignor and such third party on arm's length and customary business terms. 5. If, before the Obligations shall have been satisfied in full, Assignor shall obtain rights to any new Trademarks, the provisions of paragraph 1 shall automatically apply thereto and Assignor shall give Assignee prompt written notice thereof. 6. Assignor authorizes Assignee unilaterally to modify this Agreement by amending Schedule 1 to include any future Trademarks and Trademark ---------- applications covered by paragraphs 1 and 5 hereof. 7. If any Event of Default (as defined in the Loan Agreement) shall have occurred and be continuing, Assignee shall have, in addition to all other rights and remedies given it by this Agreement or any other Loan Document (as defined in the Loan Agreement), those allowed by law and the rights and remedies of a secured party under the Uniform Commercial Code as enacted in any jurisdiction in which the Trademarks may be located and, without limiting the generality of the foregoing, the Assignee may immediately, without demand of performance and without other notice (except as set forth below) or demand whatsoever to Assignor, all of which are hereby expressly waived, and without advertisement, sell at public or private sale or otherwise realize upon, all or from time to time any of the Trademarks, or any interest which the Assignor may have therein, and after deducting from the proceeds of sale or other disposition of the Trademarks all expenses (including all reasonable expenses for brokers' fees and legal services), shall apply the residue of such proceeds toward the payment of the Obligations. Any remainder of the proceeds after payment in full of the Obligations shall be paid over to Assignor. Notice of any sale or other disposition of the Trademarks shall be given to Assignor at least ten (10) days before the time of any intended public or private sale or other disposition of the Trademarks is to be made, which Assignor hereby agrees shall be reasonable notice of such sale or other disposition. At any such sale or other disposition Assignee or its assignee may, to the extent permissible under applicable law, purchase the whole or any part of the Trademarks sold, free from any right of redemption on the part of Assignor, which right is hereby waived and released. 8. At such time as Assignor shall completely satisfy all of the Obligations, this Agreement shall terminate and Assignee shall execute and deliver to Assignor all assignments, reconveyances or other instruments as may be necessary or proper to re-vest in Assignor full title to the Trademarks, subject to any disposition thereof which may have been made by Assignee pursuant hereto. 9. Any and all fees, costs and expenses, of whatever kind or nature, including the reasonable attorneys' fees and legal expenses incurred by Assignee in connection with the preparation of this Agreement and all other documents relating hereto and the consummation of this transaction, the filing or recording of any documents (including all taxes in connection therewith) in public offices, the payment or discharge of any taxes, counsel fees, maintenance fees, encumbrances or otherwise protecting, maintaining or preserving the Trademarks, or in defending or prosecuting any actions or proceedings arising out of or related to the Trademarks, shall be borne and paid by Assignor on demand by Assignee and until so paid shall be added to the principal amount of the Obligations and shall bear interest at the highest applicable Default Rate (as defined in the Loan Agreement). 10. Assignor shall have the duty, through counsel reasonably acceptable to Assignee, to prosecute diligently any Trademark applications pending as of the date of this Agreement or thereafter until the Obligations shall have been paid in full, to make federal application on registrable but unregistered Trademarks, to file and prosecute opposition and cancellation proceedings and to do any and all acts which are necessary or desirable to preserve and maintain all rights in the Trademarks. Any expenses incurred in connection with the Trademarks shall be borne by Assignor. The Assignor shall not abandon any Trademark without the consent of Assignee, which consent shall not be unreasonably withheld. 11. Assignor shall have the right, with the prior written consent of Assignee, which will not be unreasonably withheld, to bring any opposition proceedings, cancellation proceedings or lawsuit in its own name to enforce or protect the Trademarks, in which event Assignee may, if necessary, be joined as a nominal party to such suit if Assignee shall have been satisfied that it is not thereby incurring any risk of liability because of such joinder. Assignor shall promptly, upon demand, reimburse and indemnify Assignee for all damages, costs and expenses, including reasonable attorneys' fees incurred by Assignee, in accordance with the Loan Agreement. 12. Assignor hereby authorizes and empowers Assignee to make, constitute and appoint any officer or Assignee of Assignee as Assignee may select, in its exclusive discretion, as Assignor's true and lawful attorney-in- fact, with the power, after and during the continuance of an Event of Default, to endorse Assignor's name on all applications, documents, papers and instruments necessary for Assignee to use the Trademarks, or to grant or issue any exclusive or nonexclusive license under the Trademarks to anyone else, or necessary for Assignee to assign, pledge, convey or otherwise transfer title in or dispose of the Trademarks to any third person as a part of Assignee's realization on such collateral upon acceleration of the Obligations following an Event of Default. Assignor hereby ratifies all that such attorney shall lawfully do or cause to be done by virtue hereof. This power of attorney being coupled with an interest shall be irrevocable for the life of this Agreement. 13. If Assignor fails to comply with any of its obligations hereunder, Assignee may do so in Assignor's name or in Assignee's name, but at Assignor's expense, and Assignor hereby agrees to reimburse Assignee in full for all expenses, including reasonable attorneys' fees, incurred by Assignee in protecting, defending and maintaining the Trademarks. 14. No course of dealing between Assignor and Assignee, nor any failure to exercise, nor any delay in exercising, on the part of Assignee, any right, power or privilege hereunder or under the Loan Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or thereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege. 15. All of Assignee's rights and remedies with respect to the Trademarks, whether established hereby or by the Security Agreement, the Loan Agreement or any other agreements or by law, shall be cumulative and may be exercised singularly or concurrently. 16. The provisions of this Agreement are severable, and if any clause or provision shall be held invalid and unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall affect only such clause or provision, or part thereof, in such jurisdiction, and shall not in any manner affect such clause or provision in any other jurisdiction, or any other clause or provision of this Agreement in any jurisdiction. 17. This Agreement is subject to modification only by a writing signed by both parties, except as provided in paragraph 6. 18. This Agreement shall be binding upon Assignor and Assignee and their respective permitted successors and assigns, and shall inure to the benefit of Assignor, Assignee and the respective permitted successors and assigns, of Assignee and Assignor. 19. The validity and interpretation of this Agreement and the rights and obligations of the parties shall be governed by the laws of the State of California. WITNESS the execution hereof under seal as of the day and year first above written. COMPS.COM, INC. By: /s/ C CRANE --------------------------- Name: C A Crane ------------------------- Title: President and CEO ------------------------ VENTURE LENDING & LEASING II, INC. By: /s/ SALVADOR GUTIERREZ --------------------------- Name: Salvador Gutierrez ------------------------- Title: President ------------------------ SCHEDULE 1 TO TRADEMARK COLLATERAL ASSIGNMENT A. TRADEMARK AND TRADEMARK APPLICATIONS: Application Issue or Expiration or Trademark No. Filing Date Date Title - ---------------- ----------- ---------- ----- B. TRADEMARK LICENSES: Corresponding Date License Termination Trademark No. Granted Licensee Date - ------------- ------------ -------- ---- EX-10.49 52 WARRANT TO PURCHASE EXHIBIT 10.49 THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND ARE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE SOLD OR OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (I) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT OR (II) IN COMPLIANCE WITH RULE 144, OR (III) PURSUANT TO AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION OR COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION. WARRANT TO PURCHASE SHARES OF CLASS B COMMON STOCK OF COMPS.COM, INC. (Void after February 11, 2006) This certifies that VENTURE LENDING & LEASING II, INC., a Maryland corporation, or assigns (the "Holder"), for value received, is entitled to purchase from Comps InfoSystems, Inc., a Delaware corporation (the "Company"), A number of fully paid and nonassessable shares of the Company's Non-Voting Class B Common Stock ("Common Stock") with an aggregate initial exercise price of $225,000.00 and a per share exercise price that is halfway between the last($1.8031) and the next round of equity financing. If there is no new equity financing done within the next 18 months of the date of the Loan agreement then the warrant exercise price will equal $2.70 (the "Stock Purchase Price") at any time or from time to time up to and including 5:00 p.m. (Pacific time) on February 11, 2006 (the "Expiration Date"), upon surrender to the Company at its principal office at 9888 Carroll Center Rd., San Diego, CA 92126, (or at such other location as the Company may advise Holder in writing) of this Warrant properly endorsed with the Form of Subscription attached hereto duly filled in and signed and upon payment in cash or by check of the aggregate Stock Purchase Price for the number of shares for which this Warrant is being exercised determined in accordance with the provisions hereof. The Stock Purchase Price and the number of shares purchasable hereunder are subject to adjustment as provided in Section 4 of this Warrant. This Warrant is subject to the following terms and conditions: 1. Exercise; Issuance of Certificates; Payment for Shares. ------------------------------------------------------- (a) Unless an election is made pursuant to clause (b) of this Section 1, this Warrant shall be exercisable at the option of the Holder, at any time or from time to time, on or before the Expiration Date for all or any portion of the shares of Common Stock (but not for a fraction of a share) which may be purchased hereunder for the Stock Purchase Price multiplied by the number of shares to be purchased. The Company agrees that the shares of Common Stock purchased under this Warrant shall be and are deemed to be issued to the holder hereof as the record owner of such shares as of the close of business on the date on which the form of subscription shall have been delivered and payment made for such shares. Subject to the provisions of Section 2, certificates for the shares of Common Stock so purchased, together with any other securities or property to which the Holder hereof is entitled upon such exercise, shall be delivered to the Holder hereof by the Company at the Company's expense within a reasonable time after the rights represented by this Warrant have been so exercised. Except as provided in clause (b) of this Section 1, in case of a purchase of less than all the shares which may be purchased under this Warrant, the Company shall cancel this Warrant and execute and deliver a new Warrant or Warrants of like tenor for the balance of the shares purchasable under the Warrant surrendered upon such purchase to the Holder hereof within a reasonable time. Each stock certificate so delivered shall be in such denominations of Stock as may be requested by the Holder hereof and shall be registered in the name of such Holder or such other name as shall be designated by such Holder, subject to the limitations contained in Section 2. (b) The Holder, in lieu of exercising this Warrant by the payment of the Stock Purchase Price pursuant to clause (a) of this Section 1, may elect, at any time on or before the Expiration Date, to receive that number of shares of Stock equal to the quotient of: (i) the difference between (A) the Per Share Price (as hereinafter defined) of the Stock, less (B) the Stock Purchase Price then in effect, multiplied by the number of shares of Stock the Holder would otherwise have been entitled to purchase hereunder pursuant to clause (a) of this Section 1 (or such lesser number of shares as the Holder may designate in the case of a partial exercise of this Warrant); over (ii) the Per Share Price. Election to exercise under this section (b) may be made by delivering a signed form of subscription to the Company via facsimile, to be followed by delivery of the warrant. (c) For purposes of clause (b) of this Section 1, "Per Share Price" means: the greater of (A) the closing price of the Company's Common Stock as quoted by NASDAQ or listed on any exchange, whichever is applicable, as published in the Western Edition of The Wall Street Journal for the trading day ----------------------- immediately prior to the date of the Holder's election hereunder or, (B) if applicable at the time of or in connection with the exercise under clause (b) of this Section 1, the gross sales price of one share of the Company's Common Stock pursuant to a registered public offering or that amount which shareholders of the Company will receive for each share of Common Stock pursuant to a merger, reorganization or sale of assets. If the Company's Common Stock is not quoted by NASDAQ or listed on an exchange, the Per Share Price of the Common Stock shall be the price per share which the Company would obtain from a willing buyer for shares sold by the Company from authorized but unissued shares as such price shall be agreed upon by the Holder and the Company or, if agreement cannot be reached within ten (10) business days of the Holder's election hereunder, as such price shall be determined by a panel of three (3) appraisers, one (1) to be chosen by the Company, one (1) to be chosen by the Holder and the third to be chosen by the first two (2) appraisers. If the appraisers cannot reach agreement within 30 days of the Holder's election hereunder, then each appraiser shall deliver its appraisal and the appraisal which is neither the highest nor the lowest shall constitute the Per Share Price. In the event either party fails to choose an appraiser within 30 days of the Holder's election hereunder, then the appraisal of the sole appraiser shall constitute the Per Share Price. Each party shall bear the cost of the appraiser selected by such party and the cost of the third appraiser shall be borne one-half by each party. In the event either party fails to choose an appraiser, the cost of the sole appraiser shall be borne one- half by each party. (a) Conversion of Class B Common Stock. If at any time prior to the ---------------------------------- expiration of this Warrant, all of the Company's then outstanding Class B Common Stock is converted into shares of the Company's Class A Common Stock, then this Warrant shall immediately become exercisable for that number of shares of Class A Common Stock receivable upon conversion by a holder of the same number of shares of Class B Common Stock as were subject to this Warrant immediately prior to such conversion, and the Stock Purchase Price shall be immediately adjusted to equal the quotient obtained by dividing (x) the aggregate Stock Purchase Price of the maximum number of shares of Class B Common Stock for which this Warrant was exercisable immediately prior to such conversion, by (y) the number of shares of Class A Common Stock for which this Warrant is exercisable immediately after such conversion. After any such conversion, all references herein to Class B Common Stock shall be deemed to be references to Class A Common Stock. 2. Limitation on Transfer. ----------------------- (a) The Warrant and the Common Stock shall not be transferable except upon the conditions specified in this Section 2, which conditions are intended to insure compliance with the provisions of the Securities Act. Each holder of this Warrant or the Stock issuable hereunder will cause any proposed transferee of the Warrant or Stock to agree to take and hold such securities subject to the provisions and upon the conditions specified in this Section 2. (b) Each certificate representing (i) this Warrant, (ii) the Common Stock, and (iii) any other securities issued in respect to the Common Stock issued upon any stock split, stock dividend, recapitalization, merger, consolidation or similar event, shall (unless otherwise permitted by the provisions of this Section 2 or unless such securities have been registered under the Securities Act or sold under Rule 144) be stamped or otherwise imprinted with a legend substantially in the form set forth on the face of this Warrant 2 (c) The Holder of this Warrant and each person to whom this Warrant is subsequently transferred represents and warrants to the Company (by acceptance of such transfer) that it will not transfer the Warrant (or securities issuable upon exercise hereof unless a registration statement under the Securities Act was in effect with respect to such securities at the time of issuance thereof) except pursuant to (i) an effective registration statement under the Securities Act, (ii) Rule 144 under the Securities Act (or any similar rule under the Securities Act relating to the disposition of securities), or (iii) an opinion of counsel, reasonably satisfactory to counsel for the Company, that an exemption from such registration is available. 3. Shares to be Fully Paid; Reservation of Shares. The Company covenants ---------------------------------------------- and agrees that all shares of Common Stock which may be issued upon the exercise of the rights represented by this Warrant will, upon issuance, be duly authorized, validly issued, fully paid and nonassessable and free from all preemptive rights of any shareholder and free of all taxes, liens and charges with respect to the issue thereof. The Company further covenants and agrees that during the period within which the rights represented by this Warrant may be exercised, the Company will at all times have authorized and reserved, for the purpose of issue or transfer upon exercise of the subscription rights evidenced by this Warrant, a sufficient number of shares of authorized but unissued Common Stock, or other securities and property, when and as required to provide for the exercise of the rights represented by this Warrant. The Company will take all such action as may be necessary to assure that such shares of Common Stock may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of any domestic securities exchange upon which the Common Stock may be listed. The Company will not take any action which would result in any adjustment of the Stock Purchase Price (as defined in Section 4 hereof) if the total number of shares of Common Stock issuable after such action upon the conversion of all such shares of Preferred Stock together with all shares of Common Stock then outstanding and then issuable upon exercise of all options and upon the conversion of all convertible securities then outstanding would exceed the total number of shares of Common Stock then authorized by the Company's Articles of Incorporation. 4. Adjustment of Stock Purchase Price Number of Shares. The Stock --------------------------------------------------- Purchase Price and the number of shares purchasable upon the exercise of this Warrant shall be subject to adjustment from time to time upon the occurrence of certain events described in this Section 4. Upon each adjustment of the Stock Purchase Price, the Holder of this Warrant shall thereafter be entitled to purchase, at the Stock Purchase Price resulting from such adjustment, the number of shares obtained by multiplying the Stock Purchase Price in effect immediately prior to such adjustment by the number of shares purchasable pursuant hereto immediately prior to such adjustment, and dividing the product thereof by the Stock Purchase Price resulting from such adjustment. 4.1 Subdivision or Combination of Stock. In case the Company shall ----------------------------------- at any time subdivide its outstanding shares of Common Stock into a greater number of shares, the Stock Purchase Price in effect immediately prior to such subdivision shall be proportionately reduced, and conversely, in case the outstanding shares of Common Stock of the Company shall be combined into a smaller number of shares, the Stock Purchase Price in effect immediately prior to such combination shall be proportionately increased. 4.2 Dividends in Preferred Stock, Other Stock, Property, ---------------------------------------------------- Reclassification. If at any time or from time to time the holders of Preferred - ---------------- Stock (or any shares of stock or other securities at the time receivable upon the exercise of this Warrant) shall have received or become entitled to receive, without payment therefor, (a) Preferred Stock, or any shares of stock or other securities whether or not such securities are at any time directly or indirectly convertible into or exchangeable for Preferred Stock, or any rights or options to subscribe for, purchase or otherwise acquire any of the foregoing by way of dividend or other distribution, or (b) any cash paid or payable otherwise than as a cash dividend, or (c) Preferred Stock or other or additional stock or other securities or property (including cash) by way of spinoff, split-up, reclassification, combination of shares or similar corporate rearrangement, (other than shares of Preferred Stock issued as a stock split, adjustments in respect of which shall be covered by the terms of Section 4.1 above), 3 Then and in each such case, the Holder hereof shall, upon the exercise of this Warrant, be entitled to receive, in addition to the number of shares of Stock receivable thereupon, and without payment of any additional consideration therefore, the amount of stock and other securities and property (including cash in the cases referred to in clauses (b) and (c) above) which such Holder would hold on the date of such exercise had he been the holder of record of such Preferred Stock as of the date on which holders of Preferred Stock received or became entitled to receive such shares and/or all other additional stock and other securities and property. 4.3 Reorganization, Reclassification, Consolidation, Merger or Sale. --------------------------------------------------------------- If any capital reorganization of the capital stock of the Company, or any consolidation or merger of the Company with another corporation, or other reorganization, or the sale of all or substantially all of its assets to another corporation shall be effected in such a way that holders of Preferred Stock shall be entitled to receive stock, securities or assets with respect to or in exchange for Preferred Stock, then, as a condition of such reorganization, reclassification, consolidation, merger or sale, lawful and adequate provisions shall be made whereby the holder hereof shall thereafter have the right to purchase and receive(in lieu of the shares of the Common Stock of the Company immediately theretofore purchasable and receivable upon the exercise of the rights represented hereby) such shares of stock, securities or assets as may be issued or payable with respect to or in exchange for a number of outstanding shares of such Common Stock equal to the number of shares of such stock immediately theretofore purchasable and receivable upon the exercise of the rights represented hereby. In any such case, appropriate provision shall be made with respect to the rights and interests of the holder of this Warrant to the end that the provisions hereof (including, without limitation, provisions for adjustments of the Stock Purchase Price and of the number of shares purchasable and receivable upon the exercise of this Warrant) shall thereafter be applicable, as nearly as may be possible, in relation to any shares of stock, securities or assets thereafter deliverable upon the exercise hereof. 4.4 Intentionally omitted. ---------------------- 4.5 Notice of Adjustment. Upon any adjustment of the Stock Purchase -------------------- Price, and/or any increase or decrease in the number of shares purchasable upon the exercise of this Warrant the Company shall give written notice thereof, by first class mail, postage prepaid, addressed to the registered holder of this Warrant at the address of such holder as shown on the books of the Company. The notice, which may be substantially in the form of Exhibit "A" attached hereto, shall be signed by the Company's chief financial officer and shall state the Stock Purchase Price resulting from such adjustment and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise of this Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. 4.6 Other Notices. If at any time: ------------- (a) the Company shall declare any cash dividend upon its Preferred or Common Stock; (b) the Company shall declare any dividend upon its Preferred or Common Stock payable in stock or make any special dividend or other distribution to the holders of its Preferred Stock; (c) the Company shall offer for subscription pro rata to the holders of its Stock any additional shares of stock of any class or other rights; (d) there shall be any capital reorganization or reclassification of the capital stock of the Company, or consolidation or merger of the Company with, or sale of all or substantially all of its assets to, another corporation; (e) there shall be a voluntary or involuntary dissolution, liquidation or winding-up of the Company; or 4 (f) the Company shall take or propose to take any other action, notice of which is actually provided to holders of the Preferred or Common Stock; then, in any one or more of said cases, the Company shall give, by first class mail, postage prepaid, addressed to the holder of this Warrant at the address of such holder as shown on the books of the Company, (i) at least 5 business day's prior written notice of the date on which the books of the Company shall close or a record shall be taken for establishing the right to receive such dividend, distribution or subscription rights and (ii) with respect to any other action, notice of which is given to holders of the Common Stock, such notice as is actually provided to such holders. The foregoing shall not apply with respect to an Acquisition or Dissolution, notice of which shall be given in accordance with Section 4.3 above. Any notice given in accordance with the foregoing clause (i) shall also specify, in the case of any such dividend, distribution or subscription rights, the date on which the holders of stock shall be entitled thereto. Any notice given in accordance with the foregoing clause (ii) shall, if applicable, also specify the date on which the holders of Common Stock shall be entitled to exchange their Common Stock for securities or other property deliverable upon any reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding-up, or other action as the case may be. Notwithstanding the foregoing, with respect to any matter as to which the consent of stockholders is solicited by the Company in lieu of a meeting in accordance with Section 228 of the Delaware Corporation Law, the obligation of the Company to provide notice to the holder of this Warrant shall be solely as follows: (a) if the Company solicits the written consent of all stockholders, notice thereof shall be given to the holder of this Warrant at the same time that such written consent is solicited from all stockholders, and (b) if the Company does not solicit such written consent from all stockholders, then notice of the taking of the corporate action without a meeting shall be given to the holder of this Warrant no later than it is given to those stockholders who have not consented in writing. 5. Issue Tax. The issuance of certificates for shares of Common Stock --------- upon the exercise of the Warrant shall be made without charge to the Holder of the Warrant for any issue tax in respect thereof; provided, however, that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the issuance and delivery of any certificate in a name other than that of the then Holder of the Warrant being exercised. 6. Closing of Books. The Company will at no time close its transfer ---------------- books against the transfer of any Warrant or of any shares of Common Stock issued or issuable upon the exercise of any warrant in any manner which interferes with the timely exercise of this Warrant. 7. No Voting or Dividend Rights; Limitation of Liability. Nothing ----------------------------------------------------- contained in this Warrant shall be construed as conferring upon the Holder hereof the right to vote or to consent as a shareholder in respect of meetings of shareholders for the election of directors of the Company or any other matters or any rights whatsoever as a shareholder of the Company. No dividends or interest shall be payable or accrued in respect of this Warrant or the interest represented hereby or the shares purchasable hereunder until, and only to the extent that, this Warrant shall have been exercised. No provisions hereof, in the absence of affirmative action by the holder to purchase shares of Common Stock, and no mere enumeration herein of the rights or privileges of the Holder hereof, shall give rise to any liability of such Holder for the Stock Purchase Price or as a shareholder of the Company, whether such liability is asserted by the Company or by its creditors. 8. Intentionally Omitted --------------------- 9. Registration Rights. The Company hereby grants to the Holder, with ------------------- respect to the shares of Common Stock issuable hereunder, the piggyback registration rights set forth in Section II.B. of that certain Amended and Restated Investor Rights Agreement made and entered into as of February 9, 1998 by and among the Company, Summit Ventures III, L.P., Summit Investors II, L.P., Christopher A. Crane, Merrill Oster and Robert C. 5 Beasley (the "Investor Rights Agreement"). For purposes of such Section II.B., the Holder shall be deemed a "Holder" of "Registrable Securities" as such terms are defined in the Investor Rights Agreement. 10. Rights and Obligations Survive Exercise of Warrant. The rights and --------------------------------------------------- obligations of the Company, of the Holder of this Warrant and of the holder of shares of Common Stock issued upon exercise of this Warrant, contained in Sections 6, 8 and 9 shall survive the exercise of this Warrant. 11. Modification and Waiver. This Warrant and any provision hereof may be ----------------------- changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of the same is sought. 12. Notices. Any notice, request or other document required or permitted ------- to be given or delivered to the holder hereof or the Company shall be deemed to have been given (i) upon receipt if delivered personally or by courier (ii) upon confirmation of receipt if by telecopy or (iii) three business days after deposit in the US mail, with postage prepaid and certified or registered, to each such holder at its address as shown on the books of the Company or to the Company at the address indicated therefor in the first paragraph of this Warrant. 13. Binding Effect on Successors. This Warrant shall be binding upon any ---------------------------- corporation succeeding the Company by merger, consolidation or acquisition of all or substantially all of the Company's assets. All of the obligations of the Company relating to the Common Stock issuable upon the exercise of this Warrant shall survive the exercise and termination of this Warrant. All of the covenants and agreements of the Company shall inure to the benefit of the successors and assign of the holder hereof. The Company will, at the time of the exercise of this Warrant, in whole or in part, upon request of the Holder hereof but at the Company's expense, acknowledge in writing its continuing obligation to the Holder hereof in respect of any rights (including, without limitation, any right to registration of the shares of Common Stock) to which the holder hereof shall continue to be entitled after such exercise in accordance with this Warrant; provided, that the failure of the holder hereof to make any such request shall not affect the continuing obligation of the Company to the Holder hereof in respect of such rights. 14. Descriptive Headings and Governing Law. The descriptive headings of -------------------------------------- the several sections and paragraphs of this Warrant are inserted for convenience only and do not constitute a part of this Warrant. This Warrant shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the laws of the State of California. 15. Lost Warrants or Stock Certificates. The Company represents and ----------------------------------- warrants to the Holder hereof that upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction, or mutilation of any Warrant or stock certificate and, in the case of any such loss, theft or destruction, upon receipt of an indemnity reasonably satisfactory to the Company, or in the case of any such mutilation upon surrender and cancellation of such Warrant or stock certificate, the Company at its expense will make and deliver a new Warrant or stock certificate, of like tenor, in lieu of the lost, stolen, destroyed or mutilated Warrant or stock certificate. 16. Fractional Shares. No fractional shares shall be issued upon exercise ----------------- of this Warrant. The Company shall, in lieu of issuing any fractional share, pay the holder entitled to such fraction a sum in cash equal to such fraction multiplied by the then effective Stock Purchase Price. 17. Representations of Holder. With respect to this Warrant, Holder -------------------------- represents and warrants to the Company as follows: 17.1 Experience. It is experienced in evaluating and investing in ----------- companies engaged in businesses similar to that of the Company; it understands that investment in the Warrant involves substantial risks; it has made detailed inquiries concerning the Company, its business and services, its officers and its personnel; the 6 officers of the Company have made available to Holder any and all written information it has requested; the officers of the Company have answered to Holder's satisfaction all inquiries made by it; in making this investment it has relied upon information made available to it by the Company; and it has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of investment in the Company and it is able to bear the economic risk of that investment. 17.2 Investment. It is acquiring the Warrant for investment for its ----------- own account and not with a view to, or for resale in connection with, any distribution thereof. It understands that the Warrant, the shares of Common Stock issuable upon exercise thereof, have not been registered under the Securities Act of 1933, as amended, nor qualified under applicable state securities laws. 17.3 Rule 144. It acknowledges that the Warrant and the Common Stock --------- must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available. It has been advised or is aware of the provisions of Rule 144 promulgated under the Securities Act. 17.4 Access to Data. It has had an opportunity to discuss the --------------- Company's business, management and financial affairs with the Company's management and has had the opportunity to inspect the Company's facilities. 18. Additional Representations and Covenants of the Company. The Company -------------------------------------------------------- hereby represents, warrants and agrees as follows: 18.1 Corporate Power. The Company has all requisite corporate power ---------------- and corporate authority to issue this Warrant and to carry out and perform its obligations hereunder. 18.2 Authorization. All corporate action on the part of the Company, -------------- its directors and shareholders necessary for the authorization, execution, delivery and performance by the Company of this has been taken. This Warrant is a valid and binding obligation of the Company, enforceable in accordance with its terms. 18.3 Offering. Subject in part to the truth and accuracy of Holder's --------- representations set forth in Section 17 hereof, the offer, issuance and sale of the Warrant is, and the issuance of Common Stock upon exercise of the Warrant will be exempt from the registration requirements of the Securities Act, and are exempt from the qualification requirements of any applicable state securities laws; and neither the Company nor anyone acting on its behalf will take any action hereafter that would cause the loss of such exemptions. 18.4 Stock Issuance. Upon exercise of the Warrant, the Company will -------------- use its best efforts to cause stock certificates representing the shares of Common Stock purchased pursuant to the exercise to be issued in the individual names of Holder, its nominees or assignees, as appropriate at the time of such exercise. 18.5 Articles and By-Laws. The Company has provided Holder with true -------------------- and complete copies of the Company's Articles or Certificate of Incorporation, By-Laws, and each Certificate of Determination or other charter document setting, forth any rights, preferences and privileges of Company's capital stock, each as amended and in effect on the date of issuance of this Warrant. 18.6 Conversion of Preferred Stock. As of the date hereof, each ----------------------------- share of the Preferred Stock is convertible into one share of the Common Stock. 18.7 Financial and Other Reports. From time to time up to the --------------------------- earlier of the Expiration Date or the complete exercise of this Warrant, the Company shall furnish to Holder (i) within 90 days after the close of each fiscal year of the Company an audited balance sheet and statement of changes in financial position at and as of the end of such fiscal year, together with an audited statement of income for such fiscal year; (ii) within 45 days after the close of each fiscal quarter of the Company, an unaudited balance sheet and statement of cash flows at and as of the end of such quarter, together with an unaudited statement of income for such quarter; and (iii) promptly after sending, making available, or filing, copies of all reports, proxy statements, and financial statements that the 7 Company sends or makes available to its shareholders and all registration statements and reports that the Company files with the SEC or any other governmental or regulatory authority. IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its officers, thereunto duly authorized this 15th day of February, 1999. COMPS.COM, INC. By: /s/ C CRANE --------------------------------- Title: President and CEO ------------------------------ 8 FORM OF SUBSCRIPTION (To be signed only upon exercise of Warrant) To: _____________________________ The undersigned, the holder of the within Warrant, hereby irrevocably elects to exercise the purchase right represented by such Warrant for, and to purchase thereunder, (1) See Below ________________ (_____)shares (the "Shares:) of Stock of __________ and herewith makes payment of _____________ Dollars ($________) therefor, and requests that the certificates for such shares be issued in the name of, and delivered to, _________, whose address is ___________. The undersigned hereby elects to convert ______ percent (__%) of the value of the Warrant pursuant to the provisions of Section 1(b) of the Warrant. The undersigned represents that it is acquiring such Common Stock for its own account for investment and not with a view to or for sale in connection with any distribution thereof (subject, however, to any requirement of law that the disposition thereof shall at all times be within its control. Dated ______________________ Holder: ______________________ By: ______________________ Its: ______________________ (Address) __________________________ __________________________ (1) Insert here the number of shares called for on the face of the Warrant (or, in the case of a partial exercise, the portion thereof as to which the Warrant is being exercised), in either case without making any adjustment for additional Common Stock or any other stock or other securities or property or cash which, pursuant to the adjustment provisions of the Warrant, may be deliverable upon exercise. 9 ASSIGNMENT ---------- FOR VALUE RECEIVED, the undersigned, the holder of the within Warrant, hereby sells, assigns and transfers all of the rights of the undersigned under the within Warrant, with respect to the number of shares of Common Stock covered thereby set forth hereinbelow, unto: Name of Assignee Address No. of Shares - -------------------------------------------------------------------------------- Dated ______________________ Holder: ______________________ By: ______________________ Its: ______________________ 10 EXHIBIT "A" ---------- [On letterhead of the Company] ------------------------------ Reference is hereby made to that certain Warrant dated February 15, 1999, issued by COMPS.COM, INC., a Delaware corporation (the "Company"), to VENTURE LENDING & LEASING II, INC., a Maryland corporation (the "Holder"). [IF APPLICABLE] The Warrant provides that the actual number of shares of the Company's capital stock issuable upon exercise of the Warrant and the initial exercise price per share are to be determined by reference to one or more events or conditions subsequent to the issuance of the Warrant. Such events or conditions have now occurred or lapsed, and the Company wishes to confirm the actual number of shares issuable and the initial exercise price. The provisions of this Supplement to Warrant are incorporated into the Warrant by this reference, and shall control the interpretation and exercise of the Warrant. [IF APPLICABLE] Notice is hereby given pursuant to Section 4.5 of the Warrant that the following adjustment(s) have been made to the Warrant: [describe adjustments, setting forth details regarding method of calculation and facts upon which calculation is based]. This certifies that the Holder is entitled to purchase from the Company __________________________ (____________) fully paid and nonassessable shares of the Company's _________ Stock at a price of _________________________ Dollars ($__________) per share (the "Stock Purchase Price"). The Stock Purchase Price and the number of shares purchasable under the Warrant remain subject to adjustment as provided in Section 4 of the Warrant. Executed this ___ day of ________________, 199___. [COMPANY] By: ________________________________ Name: ________________________________ Title: ________________________________ 11 EX-23.1 53 CONSENT OF ERNST & YOUNG LLP EXHIBIT 23.1 Consent of Ernst & Young LLP, Independent Auditors We consent to the reference to our firm under the captions "Selected Financial Data" and "Experts" and to the use of our report on the COMPS.COM, Inc. financial statements dated February 5, 1999 (except for Note 15, as to which the date is February 22, 1999) and our report on the REALBID, LLC financial statements dated February 17, 1999, in the Registration Statement (Form S-1) and related Prospectus of COMPS.COM, Inc. dated February 24, 1999. Our audits also included the financial statement schedule of COMPS.COM, Inc. for the three years ended December 31, 1998 listed in Item 16(b). This schedule is the responsibility of the Company's management. Our responsibility is to express an opinion based on our audits. In our opinion, the financial statement schedule referred to above, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein. /s/ Ernst & Young LLP San Diego, California February 23, 1999 EX-27.1 54 FINANCIAL DATA SCHEDULE
5 YEAR YEAR DEC-31-1997 DEC-31-1998 JAN-01-1997 JAN-01-1998 DEC-31-1997 DEC-31-1998 351,621 377,803 0 0 2,298,167 3,165,817 1,384,242 1,464,922 0 0 2,796,151 3,728,140 2,632,598 3,566,474 (1,428,848) (2,095,936) 4,090,836 7,397,277 5,849,123 8,081,927 0 0 5,815,806 7,316,192 0 0 29,219 29,654 (9,534,545) (9,224,923) 4,090,836 7,397,277 10,449,936 12,805,761 10,449,936 12,805,761 5,053,998 5,746,180 11,755,481 14,094,526 251,640 259,557 39,491 167,858 268,290 302,152 (1,557,185) (1,548,322) 0 0 (1,557,185) (1,548,322) 0 0 0 0 0 0 (1,856,109) (1,911,557) (0.39) (.40) (0.39) (0.40)
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