According to Analytical Surveys, Inc.'s SEC 10-K filing for the fiscal year ended September 30, 2001, on September 21, 2001, the court issued an Order and Final Judgment ratifying the settlement terms of the lawsuit. The settlement, which was agreed to in principle on April 4, 2001, provides for the dismissal of the lawsuit in its entirety against all defendants and the establishment of a settlement fund of $4 million, of which the Company is contributing $100,000 of cash, and approximately 1,256,000 shares of the Company's common stock for the class.
As reported by the Company’s FORM 10-Q for the quarterly period ended March 31, 2001, on May 12, 2000, the Court consolidated the thirteen actions into one complaint. On July 26, 2000, plaintiffs filed a Consolidated Amended Class Action Complaint on behalf of themselves and a putative class consisting of all persons, other than defendants and their affiliates, who purchased the Company's common stock on the open market during the period from January 25, 1999, through and including March 7, 2000. On September 11, 2000, the Company and the named individual defendants filed motions to dismiss the plaintiffs' Consolidated Amended Class Action. On October 24, 2000, the plaintiffs filed a Memorandum in Opposition to Defendants' Motions to Dismiss the Consolidated Amended Class Action Complaint. The Court has not yet ruled on these motions. On April 4, 2001, the Company entered into an agreement in principle to settle this lawsuit against the Company and certain of its directors and former officers. The agreement in principle with the plaintiffs is subject to various conditions, including execution of a Memorandum of Understanding and Stipulation of Settlement, preliminary approval by the Court, notice to the class and final approval by the Court after a hearing.
The original complaint charges Analytical Surveys and certain of its officers and directors with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The complaint alleges that defendants issued materially false and misleading financial statements that violated generally accepted accounting principles (GAAP) and other financial reporting standards by materially overstating the Company's revenues, income and earnings. On January 27, 2000, Analytical Survey announced that even after adjusting its fiscal 1999 year end revenue and earnings on December 30, 1999, it might have to make additional adjustments by restating revenue and earnings for fiscal 1999 due to improper cost of completion projections for certain contracts.