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PREFERRED STOCK PURCHASE AGREEMENT
BETWEEN
SPACEHAB, INCORPORATED
AND
DAIMLERCHRYSLER AEROSPACE AG
Dated as of July 26, 1999
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PREFERRED STOCK PURCHASE AGREEMENT dated as of August 2, 1999 (together with all
exhibits and schedules, the "Purchase Agreement") by and among Spacehab,
Incorporated, a Washington corporation (the "Company", which term shall also
include successors and assigns), and DaimlerChrysler Aerospace AG, a German
corporation ("Purchaser", which term shall also include successors and assigns).
WI T N E S S E T H:
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In consideration of the mutual covenants and agreements set forth herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties agree as follows:
SECTION 1. SALE AND PURCHASE
1.1 Issuance of Shares.
The Company will authorize the issuance (i) on the Initial Closing Date (as
hereinafter defined) of 975,000 shares (the "Initial Shares") of Series B Senior
Convertible Preferred Stock, $0.01 par value per share (the "Preferred Stock")
and (ii) on the Second Closing Date (as hereinafter defined) of an additional
358,334 shares (the "Subsequent Shares") of Preferred Stock. The Initial Shares
and the Subsequent Shares being acquired under this Purchase Agreement are
herein collectively referred to as the "Shares" and shall contain all the rights
and privileges as more fully set forth in the Designation of Rights, Terms and
Preferences to the Articles of Incorporation adopted by the Company in the form
attached hereto as Exhibit A (the "Certificate of Designations").
1.2 The Closings.
(a) The Company agrees to sell to Purchaser and, subject to the terms and
conditions hereof and in reliance upon the representations and warranties of the
Company contained herein or made pursuant hereto, Purchaser agrees to purchase
from the Company, the Initial Shares for the aggregate purchase price of
$8,775,000, or $9.00 per Share (the "Purchase Price"). No further payment shall
be required from the Purchaser for the Initial Shares.
(b) The closing of the purchase and sale of the Initial Shares purchased by
the Purchaser (the "Initial Closing") will take place at the offices of Xxxxxx &
Xxxxxxx LLP in Washington, D.C., at 10:00 A.M., Eastern Standard time, on August
5, 1999 or such other time and date as shall be mutually agreed to by the
Company and the Purchaser. Such time and date are herein referred to as the
"Initial Closing Date".
(c) The Company agrees to sell to Purchaser and, subject to the terms and
conditions hereof and in reliance upon the representations and warranties of the
Company contained herein or made pursuant hereto, Purchaser agrees to purchase
from the Company, the Subsequent Shares for the aggregate Purchase Price of
$3,225,006, or $9.00 per Share. No further payment shall be required from the
Purchaser for the Subsequent Shares.
(d) The closing of the purchase and sale of the Subsequent Shares purchased
by the Purchaser (the "Second Closing") will take place at the offices of Xxxxxx
& Whitney LLP in
Washington, D.C., at 10:00 A.M., Eastern Standard time, on the day which is five
(5) Business Days after the shareholders of the Company approve the Amendment
(as hereinafter defined) or such other time and date as shall be mutually agreed
to by the Company and the Purchaser. Such time and date are herein referred to
as the "Second Closing Date".
(e) At each Closing (i) the Company will deliver to Purchaser a certificate
registered in Purchaser's name (or in any such other name as Purchaser may
request) evidencing the Shares being purchased at such Closing, and (ii) upon
Purchaser's receipt thereof, Purchaser will deliver to the Company by wire
transfer of immediately available funds an aggregate amount equal to the
Purchase Price of such Shares.
SECTION 2. DEFINITIONS
(a) For purposes of this Purchase Agreement, the following definitions
shall apply (such definitions to be equally applicable to both the singular and
plural forms of the terms defined):
"Affiliate," when used with respect to any Person, means any other Person
which, directly or indirectly, controls or is controlled by or is under common
control with such Person. For purposes of this definition, "control" (including
the correlative terms "controlling", "controlled by" and "under common control
with"), with respect to any Person, shall mean possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities or
by contract or otherwise. Notwithstanding the foregoing, for purposes of this
definition, neither the execution of this Purchase Agreement and the Other
Transaction Documents (or the existence of any other agreement or arrangement
between the Company and Purchaser), nor the holding of any of the Shares (or the
exercise of any such rights, including without limitation electing a director to
the Board of the Company), shall cause Purchaser (or such nominated director or
observer of any person related to such Person) to be deemed to be an "Affiliate"
of the Company or of any Subsidiary.
"Amendment" means the amendment to the Articles of Incorporation
contemplated by Section 8.2 below.
"Articles of Incorporation" means the Restated Articles of Incorporation of
the Company dated January 8, 1998, as amended by the Certificate of
Designations.
"Benefit Plan" means any Plan, existing on the Closing Date or established
prior thereto, to which contributions have at any time been made by the Company
or any Subsidiary, or any predecessor of any of the foregoing, or under which
any employee, former employee or director of the Company or any Subsidiary or
any beneficiary thereof is covered, is eligible for coverage or has benefit
rights.
"Board" means, with respect to any Person which is a corporation, a
business trust or other entity, the board of directors or other group, however
designated, which is charged with legal responsibility for the management of
such Person, or any committee of such board of directors or
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group, however designated, which is authorized to exercise the power of such
board or group in respect of the matter in question.
"Business Day" means any day, other than a Saturday, Sunday or legal
holiday, on which banks in New York, New York are open for business.
"Certificate of Designations" has the meaning set forth in Section 1.1
hereof.
"Closing"means the Initial Closing or the Subsequent Closing, as the case
may be.
"Closing Date" means the Initial Closing Date or the Subsequent Closing
Date, as the case may be.
"Code" means the United States Internal Revenue Code of 1986, as amended
from time to time, and the regulations and interpretations thereunder.
"Collaboration Agreement" has the meaning set forth in Section 3.1(b)
hereof.
"Commission" means the United States Securities and Exchange Commission and
any other similar or successor agency of the federal government administering
the Securities Act or the Exchange Act.
"Common Stock" of the Company or of a Subsidiary (as the case may be) shall
mean the Company's or the Subsidiary's (as the case may be) presently authorized
Common Stock, and any stock into which such Common Stock may hereafter be
changed or for which such Common Stock may be exchanged after giving effect to
the terms of such change or exchange (by way of reorganization,
recapitalization, merger, consolidation or otherwise) and shall also include any
Common Stock of the Company or of a Subsidiary (as the case may be) of any other
class hereafter authorized which is not preferred as to dividends or assets over
any other class of capital stock of the Company or a Subsidiary (as the case may
be) or which has ordinary voting power for the election of directors of the
Company or of a Subsidiary (as the case may be).
"Company" means Spacehab, Incorporated, a Washington corporation, and its
successors and assigns.
"Consents" has the meaning set forth in Section 5.4 hereof.
"Consolidated" or "consolidated" when used with reference to any financial
term in this Purchase Agreement, means the aggregate for the Company and its
Subsidiaries of the amounts signified by such term for all such Persons, with
intercompany items eliminated, and, with respect to net worth, after eliminating
the portion of net worth properly attributable to minority interests, if any, in
the capital of any such Person (other than in the capital of the Company) and
otherwise as determined in accordance with GAAP (except as otherwise expressly
provided herein).
"Disclosure Material" has the meaning set forth in Section 5.5(a) hereof.
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"Environmental Claim" means any and all administrative or judicial actions,
suits, orders, claims, liens, notices, notices of violations, investigations,
complaints, requests for information, proceedings, or other communication
(written or oral), whether criminal or civil, (collectively, "Claims") pursuant
to or relating to any applicable Environmental Law or any Environmental Permit
by any person (including but not limited to any Governmental Authority, private
person and citizens' group) based upon, alleging, asserting, or claiming any
actual or potential (i) violation of or liability under any Environmental Law,
(ii) violation of any Environmental Permit, or (iii) liability for investigatory
costs, cleanup costs, removal costs, remedial costs, response costs, natural
resource damages, property damage, personal injury, fines, or penalties arising
out of, based on, resulting from, or related to the presence, Release, or
threatened Release into the environment, of any Hazardous Materials at any
location, including but not limited to any off-Site location to which Hazardous
Materials or materials containing Hazardous Materials were sent for handling,
storage, treatment, or disposal.
"Environmental Laws" means all current and future, federal, state, local,
foreign, civil and criminal laws, statutes, ordinances, orders, codes,
Environmental Permits, rules, policies, and regulations and common law relating
to the protection of the environment and human health or relating to the
handling, use, generation, treatment, storage, transportation or disposal of
Hazardous Materials, including but not limited to the Resource Conservation and
Recovery Act of 1976, 42 U.S.C. ss. 6901 et seq.; the Toxic Substances Control
Act, 15 U.S.C. ss. 2601 et seq.; the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. ss. 9601 et seq.; the Federal
Water Pollution Control Act, 33 U.S.C. ss. 1251 et seq.; the Clean Air Act, 42
U.S.C. ss. 7401 et seq.; the Hazardous Materials Transportation Act, 49 U.S.C.
ss. 1801 et seq.; the Occupational Safety and Health Act, 29 U.S.C. ss. 651; the
Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. ss. 136 et seq. and
the Oil Pollution Act of 1990, 33 U.S.C. ss. 2701 et seq.; and all the state
analogues thereto, all as may be amended or superseded from time to time.
"Environmental Permits" means all permits, licenses, approvals,
authorizations or consents required by any Governmental Authority under any
applicable Environmental Law and includes any and all orders, consent orders or
binding agreements issued or entered into by a Governmental Authority under any
applicable Environmental Law.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the rules and regulations promulgated thereunder.
"ERISA Affiliate" means any Person who is, or at any time was, a member of
a controlled group (within the meaning of Section 412(n)(6) of the Code) that
includes, or at any time included, the Company or any Subsidiary, or any
predecessor of any of the foregoing.
"Exchange Act" means the United States Securities Exchange Act of 1934, as
amended from time to time, and the rules, regulations and interpretations
thereunder.
"GAAP" means United States generally accepted accounting principles
consistently applied.
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"Governmental Authority" means any federal, state, local or county
governmental agency, department, board, commission, instrumentality or authority
(including regulatory authority) of the United States or any foreign nation or
any self regulatory organization having jurisdiction over the Company (or any
Subsidiary) or any of their respective assets or businesses.
"Hazardous Materials" means any petroleum, petroleum hydrocarbons,
petroleum waste or petroleum products, underground storage tanks, asbestos or
asbestos containing materials, pesticides, lead and lead containing materials,
urea formaldehyde insulation and polychlorinated biphenyls (PCBs), ionizing and
non-ionizing radiation (including radon and electromagnetic frequency
radiation); and any chemicals, materials, substances or wastes in any amount or
concentration which are now or hereafter become defined as or included in the
definition of "hazardous substances," "hazardous wastes," "hazardous materials,"
"extremely hazardous wastes," "restricted hazardous wastes," "toxic substances,"
"toxic pollutants" or words of similar import, under any Environmental Law.
"Initial Closing" has the meaning set forth in Section 1.2(b) hereof.
"Initial Closing Date" has the meaning set forth in Section 1.2(b) hereof.
"Initial Shares" has the meaning set forth in Section 1.1 hereof.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), or preference, priority or
other security interest of any kind or nature whatsoever (including without
limitation any conditional sale or other title retention agreement, any
financing lease having substantially the same effect as any of the foregoing,
any assignment or other conveyance of any right to receive income and any
assignment of receivables with recourse against the assignor), any filing of a
financing statement as debtor under the Uniform Commercial Code or any similar
statute and any agreement to give or make any of the foregoing.
"Material Adverse Effect" means any event, matter, condition or
circumstance which (i) has or could reasonably be expected to have a material
adverse effect on the assets, properties, liabilities, business, affairs,
results of operations, condition (financial or otherwise) or prospects of (x)
any Subsidiary of the Company which, as of the date any determination is made as
to the existence of a Material Adverse Effect, contributed twenty-five percent
(25%) of the Company's consolidated revenues for the prior fiscal year or (y)
the Company on a consolidated basis or (ii) has or could reasonably be expected
to have a material adverse effect on the ability of the Company to perform its
obligations under this Purchase Agreement or the Other Transaction Documents.
"Other Transaction Documents" means, collectively, the Certificate of
Designations, the Amendment, the Collaboration Agreement, the Registration
Rights Agreement and a side letter from Xx. Xxxxxxx X. Xxxxxxxx of the Company
to Xx. Xxxxxxx Xxxxxxxx and Xx. Xxxxx Kind of Purchaser (each as amended,
modified or supplemented from time to time) and any other documents, agreements,
instruments or certificates contemplated hereby or thereby.
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"Person" or "person" means an individual, corporation, company,
partnership, firm, association, joint venture, trust, unincorporated
organization, government, governmental body, agency, political subdivision or
other entity.
"Plan" means any bonus, incentive compensation, deferred compensation,
pension, profit sharing, retirement, stock purchase, stock option, stock
ownership, stock appreciation rights, phantom stock, leave of absence, layoff,
vacation, day or dependent care, legal services, cafeteria, life, health,
accident, disability, workmen's compensation or other insurance, severance,
separation or other employee benefit plan, practice, policy or arrangement of
any kind, whether written or oral, or whether for the benefit of a single
individual or more than one individual including, but not limited to, any
"employee benefit plan" within the meaning of Section 3(3) of ERISA.
"Purchase Agreement" has the meaning set forth in the first paragraph
hereof.
"Purchase Price" has the meaning set forth in Section 1.2(a) hereof.
"Purchaser" has the meaning set forth in the first paragraph hereof.
"Purchaser Director" has the meaning set forth in Section 8.1(a) hereof.
"Qualified Holder" has the meaning set forth in Section 7.1 (b) hereof.
"Release" means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, or disposing of a
Hazardous Material into the environment.
"Rule 144" means (i) Rule 144 under the Securities Act as such Rule is in
effect from time to time, and (ii) any successor rule, regulation or law, as in
effect from time to time.
"Rule 144A" means (i) Rule 144A under the Securities Act as such Rule is in
effect from time to time and (ii) any successor rule, regulation or law, as in
effect from time to time.
"Rule 144 Transaction" means a transfer of Common Stock (A) complying with
Rule 144 under the Securities Act as such Rule is in effect on the date of such
transfer (but not including a sale other than pursuant to a "brokers
transaction" as defined in clauses (1) and (2) of paragraph (g) of such Rule as
in effect on the date hereof) and (B) occurring at a time when Common Stock are
registered pursuant to Section 12 of the Exchange Act (or any successor to such
Section).
"Second Closing" has the meaning set forth in Section 1.2(d) hereof.
"Second Closing Date" has the meaning set forth in Section 1.2(d) hereof.
"Secretary of State" means the Secretary of State of the State of
Washington.
"Securities Act" means the United States Securities Act of 1933, as amended
from time to time, and the rules, regulations and interpretations thereunder.
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"SEC Documents" has the meaning set forth in Section 5.5(d) hereof.
"Series A Designation" means the Certificate of Designation of Rights,
Terms and Preferences of Series A Junior Participating Preferred Stock of the
Company dated March 26, 1999.
"Shares" has the meaning set forth in Section 1.1 hereof.
"Site" means any of the real properties currently or previously owned,
leased or operated by the Company, any Subsidiary, any predecessors of the
Company or any Subsidiary, or any entities previously owned by the Company or
any Subsidiary, including all soil, subsoil, surface waters and groundwater
thereat.
"Subsequent Shares" has the meaning set forth in Section 1.1 hereof.
"Subsidiary" with respect to any Person, means any corporation, association
or other entity controlled by such Person. For purposes of this definition,
"control" with respect to any Person, shall mean possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities or
by contract or otherwise. The term "Subsidiary" or "Subsidiaries" when used
herein without reference to any particular Person, means a Subsidiary or
Subsidiaries of the Company which may now or hereafter exist.
(b) For all purposes of this Purchase Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(i) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Purchase Agreement as a whole and not to any
particular Section or other subdivision;
(ii) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP (except as otherwise
expressly provided herein);
(iii) all computations provided for herein shall be made in accordance
with GAAP (except as otherwise expressly provided herein);
(iv) any uses of the masculine, feminine or neuter gender shall also
be deemed to include any other gender, as appropriate,
(v) all references herein to actions by the Company or any Subsidiary,
such as "create," "sell," "transfer," "dispose of," etc., means such
action, whether voluntary or involuntary, by operation of law or otherwise,
(vi) the exhibits and schedules to this Purchase Agreement shall be
deemed a part of this Purchase Agreement,
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(vii) each of the representations and warranties of the Company
contained in Section 5 hereof is separate and is not limited, qualified or
modified by the existence, wording or satisfaction of any other
representation or warranties of the Company in Section 5 or otherwise,
(viii) each of the covenants of the Company contained in Sections 7
and 8 hereof or otherwise contained in the Other Transaction Documents is
separate and is not limited or satisfied by the existence, wording or
satisfaction of any other covenant of the Company in Sections 7 or 8 or
otherwise; and
(ix) all references herein (in covenants or otherwise) to any
action(s) which are to be taken (or which are prohibited from being taken)
by any Person, the Company or any Subsidiary shall apply to such Person,
the Company or such Subsidiary, as the case may be, whether such action is
taken directly or indirectly.
SECTION 3. CONDITIONS TO CLOSING
The Purchaser's obligation to purchase the Shares hereunder at a Closing is
subject to satisfaction of the following conditions at or prior to such Closing
(any of which may be waived by the Purchaser).
3.1 Certificate of Designations; Amendment; Collaboration Agreement;
Registration Rights Agreement.
(a) The Articles of Incorporation of the Company shall have been duly
amended by the filing of the Certificate of Designations (and, in the case of
the Second Closing, by the Amendment).
(b) The Company and the Purchaser shall have entered into a Strategic
Collaboration Agreement relating to certain areas of mutual technological
interest dated the date hereof (the "Collaboration Agreement") in the form
attached hereto as Exhibit B.
(c) The Company and the Purchaser shall have entered into a Registration
Rights Agreement dated the date hereof ( the "Registration Rights Agreement") in
the form attached hereto as Exhibit C.
3.2 Accuracy of Representations and Warranties.
The representations and warranties of the Company herein or in any Other
Transaction Document or in any certificate or document delivered pursuant hereto
or thereto shall be correct and complete on and as of the Closing Date with the
same effect as though made on and as of the Closing Date (after giving effect to
the transactions contemplated by this Purchase Agreement).
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3.3 Compliance with Agreements.
The Company shall have performed and complied with all agreements,
covenants and conditions contained in this Purchase Agreement, the Other
Transaction Documents and any other document contemplated hereby or thereby
which are required to be performed or complied with by the Company on or before
the Closing Date.
3.4 Certificates.
Purchaser shall have received from the Company the following:
(a) a certificate dated the Closing Date and signed by the Chairman or
President and by the Secretary or Assistant Secretary of the Company, to the
effect set forth in Exhibit D-1 hereto certifying as to the fulfillment of the
conditions contained in this Section 3;
(b) a certificate dated the Closing Date and signed by the Chairman or
President and by the Secretary or Assistant Secretary of the Company, to the
effect set forth in Exhibit D-2 hereto, having attached thereto the following:
(i) certified copies of the resolutions duly adopted by the Board of
the Company authorizing the execution, delivery and performance of this
Purchase Agreement, the Other Transaction Documents, the issuance and sale
of the Shares and the consummation of all other transactions contemplated
by this Purchase Agreement and the Other Transaction Documents;
(ii) certified copies of the Articles of Incorporation of the Company
and each of its Subsidiaries, all amendments thereto and the By-laws of the
Company and each of its Subsidiaries, each as in effect at the Closing; and
(iii) certificates of good standing of the Company and each of its
Subsidiaries from their respective states of incorporation or organization.
3.5 Proceedings.
All corporate and other proceedings in connection with the transactions
contemplated by this Purchase Agreement and the Other Transaction Documents, and
all documents incident hereto and thereto, shall be in form and substance
satisfactory to Purchaser and its counsel, and Purchaser shall have received all
such originals or certified or other copies of such documents as Purchaser or
its counsel may reasonably request.
3.6 Legality: Governmental and Other Authorization.
The purchase of and payment for the Shares shall not be prohibited by any
law or governmental order, rule, ruling, regulation, release, interpretation or
opinion applicable to Purchaser and shall not subject Purchaser to any penalty,
tax, liability or other onerous condition. The Consents
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set forth in Schedule 5.4 hereto have been obtained or made by the Company and
shall be in full force and effect (and all such Consents shall have been
delivered to Purchaser).
3.7 No Change in Law, etc
No legislation, order, rule, ruling or regulation shall have been proposed,
enacted or made by or on behalf of any Governmental Authority, and no
legislation shall have been introduced in either House of Congress, and no
investigation by any Governmental Authority shall have been commenced or
threatened, and no action, suit or proceeding shall have been commenced before,
and no decision shall have been rendered by, any court, other Governmental
Authority or arbitrator, which, in any such case, in Purchaser's reasonable
judgment could adversely affect, restrain, prevent or change the transactions
contemplated by this Purchase Agreement or the Other Transaction Documents
(including without limitation the issuance of the Shares) or materially and
adversely affect the assets, properties, liabilities, business, affairs, results
of operations, condition (financial or otherwise) or prospects of the Company on
a consolidated basis.
3.8 Opinion of Counsel.
The Purchaser shall have received an opinion, dated the Closing Date and
addressed to Purchaser, of Xxxxx Xxxxxxxxxx LLP, counsel for the Company. Such
opinion shall be in form and substance satisfactory to Purchaser and shall be to
the effect set forth in Exhibit E hereto. The Company hereby instructs such
counsel to prepare and deliver such opinion to Purchaser pursuant to this
Section 2.8 and agrees that Purchaser may rely on the opinion so delivered.
3.9 Company Financial Condition; No Material Adverse Effect.
Since March 31, 1999, no event or events shall have occurred, and no
condition or conditions shall exist, which could have a Material Adverse Effect.
3.10 Other Documents and Opinions.
Purchaser shall have received such other documents and opinions, in form
and substance satisfactory to Purchaser and its counsel, relating to matters
incident to the transactions contemplated hereby, as Purchaser may reasonably
request.
3.11 Purchaser Director.
The Purchaser Director shall upon closing be elected to the Board of
Directors of the Company, and the Purchaser Director shall, upon closing, be
appointed as a member of the Executive Committee of the Board.
SECTION 4. COMPANY'S CONDITIONS TO CLOSING
The Company's obligations to issue and sell to Purchaser the Shares to be
issued by it on a Closing Date are subject to satisfaction of the following
conditions at Closing:
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4.1 Collaboration Agreement; Registration Rights Agreement.
(a) The Company and the Purchaser shall have entered into the Strategic
Collaboration Agreement.
(b) The Company and the Purchaser shall have entered into the Registration
Rights Agreement.
4.2 Accuracy of Representations and Warranties.
The representations and warranties of Purchaser in Section 6 hereof shall
be correct and complete on and as of the Closing Date with the same effect as
though made on and as of the Closing Date.
4.3 Compliance with Agreements.
The Purchaser shall have performed and complied with all agreements,
covenants and conditions contained in this Purchase Agreement, the Other
Transaction Documents and any other document contemplated hereby or thereby
which are required to be performed or complied with by the Purchaser on or
before the Closing Date.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Purchaser as follows as of the date
hereof and as of each Closing Date.
5.1 Corporate Existence, Power and Authority.
(a) The Company and each Subsidiary is a corporation duly organized,
validly existing and in good standing under the laws of its state or other
jurisdiction of incorporation. The Company and each Subsidiary is duly
qualified, licensed and authorized to do business and is in good standing in
each jurisdiction in which it owns or leases any material property or in which
the conduct of its business requires it to be so qualified or licensed.
(b) No proceeding has been commenced looking toward the dissolution or
merger of the Company or any Subsidiary. Except as contemplated by this
Agreement, no proceeding has been commenced looking toward the amendment of the
respective certificate or articles of incorporation of the Company or any
Subsidiary (as the case may be). Neither the Company nor any Subsidiary is in
violation in any respect of its certificate or articles of incorporation or
by-laws.
(c) The Company and each Subsidiary has all requisite power, authority
(corporate and other) and legal right to own or to hold under lease and to
operate the properties it owns or holds and to conduct its business as now being
conducted.
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(d) The Company has all requisite power, authority (corporate and other)
and legal right to execute, deliver, enter into, consummate and perform the
transactions contemplated by this Purchase Agreement and each Other Transaction
Document (including without limitation the issuance by the Company of the
Shares). The execution, delivery and performance by the Company of this Purchase
Agreement and each Other Transaction Document (including without limitation the
issuance of the Shares) have been duly authorized by all required corporate and
other actions. The Company has duly executed and delivered this Purchase
Agreement and each Other Transaction Document and, at Closing, will duly deliver
the Shares. This Purchase Agreement and each Other Transaction Document
constitute the legal, valid and binding obligations of the Company, enforceable
against the Company in accordance with their respective terms.
5.2 Capitalization.
(a) The authorized capital stock of the Company consists of: (i) 30,000,000
shares of Common Stock, par value $0.01 per share; and (ii) 1,000,000 shares of
serial preferred stock, par value $0.01 per share, of which 25,000 shares were
designated Series A Junior Participating Preferred Stock pursuant to the Series
A Designation and, giving effect to the Certificate of Designations, 975,000 are
being designated Series B Senior Convertible Preferred Stock. Following filing
of the Amendment on or before the Second Closing Date, the number of shares of
authorized serial preferred stock will be increased to 2,500,000, of which
1,333,334 will be designated Series B Senior Convertible Preferred Stock. Item
(a) of Schedule 5.2 sets forth the number of shares of Common Stock issued and
outstanding on the Closing Date. At Closing, all of such shares of capital stock
will be duly authorized and validly issued and will be outstanding and fully
paid and non-assessable. No shares of preferred stock (other than the Shares
being issued to Purchaser) of the Company will be issued and outstanding on
either Closing Date. The Shares will, when issued, be duly authorized, validly
issued, fully paid and non-assessable. None of the shares of the Company's
capital stock or other securities which will be outstanding at a Closing will be
subject to preemptive rights or provide the holders thereof with any preemptive
rights with respect to any issuance of capital stock. On each Closing Date, no
other shares of capital stock of the Company will be outstanding or held in the
Company's treasury.
(b) Except as set forth in item (b) of Schedule 5.2, and except for Common
Stock issuable upon conversion of the Shares (the "underlying Common Stock"), no
shares of the Company's Common Stock are reserved for issuance by the Company.
The underlying Common Stock is duly authorized and reserved for issuance and,
upon conversion of the Shares will be validly issued, fully paid and
non-assessable, free and clear of any and all liens, claims and encumbrances,
and entitled to be traded on the National Association of Securities Dealers
Automated Quotation system National Market ("NASDAQ"), and the holders of such
underlying Common Stock shall be entitled to all rights and preferences accorded
to a holder of Common Stock.
(c) Except as set forth in item (c) of Schedule 5.2, there are no
outstanding options, warrants, subscriptions, rights, calls, convertible
securities or other agreements or plans or any provision of law under which the
Company may become obligated to issue, sell or transfer shares of its capital
stock or other securities.
12
(d) Except as set forth in item (d) of Schedule 5.2, and except as provided
in the Registration Rights Agreement, there are no outstanding registration
rights with respect to any capital stock of the Company or of any Subsidiary.
(e) Except as provided in item (e) of Schedule 5.2, there are no
shareholder or voting agreements, voting trusts, proxies or other agreements or
understandings with respect to the voting of any capital stock of the Company or
any Subsidiary.
(f) Except as set forth in item (f) of Schedule 5.2, and except as provided
by the terms of the Certificate of Designations, there are no anti-dilution
protections or other adjustment provisions in existence with respect to any
outstanding capital stock of the Company.
(g) The Certificate of Designations has been duly adopted by the Company
and filed with the Secretary of State and is fully effective as an amendment to
the Company's Articles of Incorporation. The Amendment has been duly adopted by
the Board and, upon approval by the Company's shareholders and filing thereof
with the Secretary of State, will be fully effective as a further amendment to
the Company's Articles of Incorporation. The Initial Shares have, and upon
filing of the Amendment the Subsequent Shares will have, all the rights,
priorities and terms set forth in the Certificate of Designations.
5.3 Subsidiaries.
(a) The Company's only Subsidiaries on each Closing Date will be those set
forth on Schedule 5.3 hereto. Such Subsidiaries are owned by the Company as set
forth in Schedule 5.3 hereto. Neither the Company nor any Subsidiary owns any
equity or debt securities in any other Person.
(b) All outstanding capital stock of the Subsidiaries has been duly
authorized and validly issued and is fully paid and non-assessable and is owned
beneficially and of record by the Company free and clear of all Liens, options
or claims of any kind. There are no outstanding options, warrants,
subscriptions, rights, convertible securities or other agreements or plans under
which any Subsidiary may become obligated to issue or sell shares of its capital
stock or other securities.
5.4 No Defaults or Conflicts.
(a) Neither the Company nor any of its Subsidiaries is in material
violation of or material default in any respect under any indenture, agreement
or instrument to which it is a party or by which it or its properties may be
bound. Neither the Company nor any of its Subsidiaries is in default under any
order, writ, injunction, judgment or decree of any court or other Governmental
Authority or arbitrator(s) which default could have a Material Adverse Effect.
(b) The execution, delivery and performance by the Company of this
Purchase Agreement and each of the Other Transaction Documents to which it is a
party, and any of the transactions contemplated hereby or thereby (including
without limitation the issuance of the Shares as contemplated herein) does not
and will not (i) violate or conflict with, result in a breach of, or
13
constitute a default under (with or without the giving of notice or the passage
of time or both) any provision of (A) the respective articles or certificate of
incorporation or by-laws of the Company or any of its Subsidiaries or (B) any
law, rule, regulation or order of any Governmental Authority, or any order,
judgment, writ, injunction, decree, award or other action of any court or
Governmental Authority or arbitrator(s), or (C) any material agreement,
mortgage, indenture, franchise, license, permit or other instrument applicable
to the Company or any of its Subsidiaries or any of their respective properties,
(ii) result in the creation of any Lien upon any of the Company's or any
Subsidiary's properties, assets or revenues, (iii) except as set forth in
Schedule 5.4 hereto, require the consent, waiver or approval of, or license,
permit, order or authorization of, or the declaration, registration,
qualification or filing with, any Governmental Authority or other Person
(collectively, "Consents"), or (iv) except as set forth in Schedule 5.4 hereto,
cause anti-dilution clauses of any outstanding securities to become operative or
give rise to any preemptive rights.
5.5 Disclosure Materials: Other Information.
(a) The Company has previously furnished to Purchaser the following
material (the "Disclosure Material"): (i) audited consolidated financial
statements of the Company and its Subsidiaries consisting of consolidated
balance sheets as at June 30, 1998 and June 30, 1997 and the related
consolidated statements of income, changes in shareholders' equity and cash
flows for the fiscal years ended June 30, 1998 and June 30, 1997 and the nine
months ended June 30, 1996 and the related notes thereto, all of which
statements have been certified by KPMG Peat Marwick LLP, independent certified
public accountants; (ii) unaudited consolidated financial statements of the
Company consisting of consolidated balance sheets as at March 31, 1999 and the
related consolidated statements of income, shareholders' equity and cash flows
for the three and nine-month periods then ended and the related notes thereto;
(iii) the other financial information described in Schedule 5.5(a)(iii); and
(iv) the Company's Form 10-K for the year ended June 30, 1998, Form 10-Q for the
fiscal quarters ended September 30, 1998, December 31, 1998 and March 31, 1999
and all other reports, schedules, forms, statements and other documents filed by
the Company with the Commission since June 30, 1998 (in each case, as amended
since the time of filing). The audited and unaudited financial statements
referred to in the preceding clauses (i) and (ii) above (including in each case
the related notes and schedules) fairly present the financial condition of the
Company and its Subsidiaries as of the respective dates thereof and the results
of the operations of the Company and its Subsidiaries for such periods and have
been prepared in accordance with GAAP, except that any such unaudited statements
may omit notes and may be subject to normal year-end adjustments.
(b) Since March 31, 1999, (i) the business of the Company and its
Subsidiaries has been conducted in the ordinary course and (ii) except as set
forth in Schedule 5.5, there has occurred no event that could reasonably be
expected to have a Material Adverse Effect.
(c) Neither the Company nor any Subsidiary is aware of any obligations or
liabilities, contingent or otherwise (including without limitation any tax
liabilities due or to become due), of the Company or of the Subsidiaries that
have not been fully disclosed and adequately provided for in the financial
statements referred to in Section 5.5(a) above or otherwise disclosed in
Schedule 5.5 hereto, other than liabilities arising in the ordinary course of
business subsequent to March 31, 1999, none of which would have a Material
Adverse Effect.
14
(d) The Company has filed all required reports, schedules, forms,
statements and other documents with the Commission since June 30, 1998 (such
reports, schedules, forms, statements and other documents, together with all
registration statements filed by the Company or its Subsidiaries with the
Commission since June 30, 1998, in each case, as such documents have been
amended since the time of their filing) (all such documents referred to herein
as the "SEC Documents"). As of their respective filing dates (or, if amended, as
of the date of the filing of such amendment), the SEC Documents complied in all
material respects with the requirements of the Securities Act or the Exchange
Act, as the case may be, and the rules and regulations of the Commission
promulgated thereunder applicable to such SEC Documents. None of the SEC
Documents as of such dates contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading.
(e) The financial information referred to in Section 5.5(a)(iii) was
prepared in good faith and the Company reasonably believes that as of the
respective dates of their preparation there was a reasonable basis for such
financial information, subject to the assumptions made in their preparation and
the qualifications set forth therein, and nothing has come to the Company's
attention to cause it to believe that the financial information and assumptions
upon which it was predicated were unreasonable as of the respective preparation
dates thereof.
(f) Nothing has come to the attention of the Company or any Subsidiary that
would cause it to believe that any of the Disclosure Material contained or
contains a false or misleading statement of a material fact or omits to state
any material fact necessary in order to make the statements made in such
material, in light of the circumstances under which they were made, not
misleading, provided that the financial information items referred to in Section
5.5(a)(iii) have not been updated since their respective dates of preparation.
5.6 Litigation.
Except as set forth in Schedule 5.6, there is no action, suit, arbitration,
proceeding, investigation or claim pending or, to the knowledge of the Company
or its Subsidiaries, threatened, in law, equity or otherwise before any court,
administrative agency, Governmental Authority or arbitrator which either (i)
questions the validity of this Purchase Agreement or any of the Other
Transaction Documents or any action taken or to be taken pursuant hereto or
thereto, (ii) could have a Material Adverse Effect, or (iii) would be required
to be, but has not previously been, described in any filing by the Company with
the Commission. The Company has no knowledge of any unasserted claim that, if
asserted, could have a Material Adverse Effect.
5.7 Taxes.
The Company and each Subsidiary has duly and timely filed all federal,
state, local, foreign and other tax returns, statements, forms and reports, and
any other returns (including information returns), statements, forms and reports
with all Governmental Authorities required to be filed by it and all such
returns are complete and correct. The Company and each Subsidiary has paid or
caused to be paid all taxes, fees, assessments and other governmental charges or
levies (including interest
15
and penalties) that are due and payable (whether or not shown on any such
return), except those which are being contested by it in good faith by
appropriate proceedings and in respect of which adequate reserves are being
maintained on its books in accordance with GAAP. The Company and each Subsidiary
has withheld and paid all taxes required to have been withheld and paid,
including taxes in connection with amounts paid or owing to any employee,
creditor, independent contractor or other third party. Neither the Company nor
any Subsidiary has any material liabilities for taxes other than those incurred
in the ordinary course of business and in respect of which adequate reserves are
being maintained by it in accordance with GAAP.
5.8 Employee Benefit Plans.
The transactions contemplated by this Agreement will not trigger or cause
to be made or provided in any way (either directly or indirectly) any payments,
or result in the acceleration or other increase in any vesting of rights or
other benefits of any kind whatsoever, under (i) any Benefit Plan (including but
not limited to the Spacehab, Incorporated Directors' Stock Option Plan or 1994
Stock Incentive Plan), and (ii) any employment, consulting, severance or similar
agreements or arrangements, whether formal or informal, whether written or oral.
5.9 Legal Compliance.
(a) The Company and each Subsidiary has complied with all applicable
constitutions, statutes, laws, rules, regulations, orders, licenses, judgments,
writs, injunctions, decrees, rulings, charges or demands, except to the extent
that the failure to so comply could not have a Material Adverse Effect.
(b) There are no adverse orders, judgments, writs, injunctions, decrees,
rulings, charges or demands of any court or administrative body, domestic or
foreign, or of any other Governmental Authority, outstanding against the Company
or any Subsidiary, which would cause a Material Adverse Effect.
5.10 Environmental Compliance.
(a) The Company and each Subsidiary has obtained and holds all necessary
Environmental Permits.
(b) The Company and each Subsidiary is in compliance in all material
respects with all terms, conditions and provisions of all applicable (i)
Environmental Permits, and (ii) Environmental Laws.
(c) There are no past, pending, or to the knowledge of the Company or any
Subsidiary, threatened Environmental Claims against the Company or any
Subsidiary, and neither the Company nor any Subsidiary is aware of any facts or
circumstances which could reasonably be expected to form the basis for any
Environmental Claim against the Company.
16
(d) No Releases of Hazardous Materials have occurred at, from, in, to, on,
or under any Site and, except as set forth in Schedule 5.10 hereto, no Hazardous
Materials are present in, on, about or migrating to or from any Site that could
give rise to an Environmental Claim against the Company or any Subsidiary.
(e) Except as set forth in Schedule 5.10, neither the Company, any
Subsidiary, any predecessor of the Company or any Subsidiary, nor any entity
previously owned by the Company or any Subsidiary, has transported or arranged
for the treatment, storage, handling, disposal, or transportation of any
Hazardous Material to any off-Site location which could result in an
Environmental Claim against the Company or any Subsidiary.
(f) There are no Liens relating to an Environmental Claim on the assets or
property of the Company or any Subsidiary arising under or pursuant to any
Environmental Law on any Site and, to the Company's or any Subsidiary's
knowledge, there are no facts, circumstances, or conditions that could
reasonably be expected to restrict, encumber, or result in the imposition of
special conditions under any Environmental Law with respect to the ownership,
occupancy, development, use, or transferability of any Site.
(g) Except as set forth in Schedule 5.10, there are no (i) underground
storage tanks, active or abandoned, (ii) polychlorinated biphenyl containing
equipment, or (iii) asbestos containing material at any Site, which could result
in an Environmental Claim against the Company or any Subsidiary.
(h) Except as set forth in Schedule 5.10, there have been no environmental
investigations, studies, audits, tests, reviews or other analyses conducted by,
on behalf of, or which are in the possession of the Company or any Subsidiary
with respect to any Site.
5.11 Outstanding Securities.
All securities (as defined in Section 2(l) of the Securities Act) of the
Company have been offered, issued, sold and delivered in compliance with, or
pursuant to exemptions from, all applicable federal and state laws, and the
rules and regulations of federal and state regulatory bodies governing the
offering, issuance, sale and delivery of securities.
5.12 Permits, Filings, Licenses and Approvals: Intellectual Property and
Other Rights
The Company and each Subsidiary owns or possesses and holds free from
burdensome restrictions all franchises, licenses, permits, consents, approvals
and other authorizations (governmental or otherwise), patents, patent rights,
trademarks, trademark rights, tradenames, tradename rights and copyrights, and
all rights and privileges with respect to any of the foregoing, as are necessary
for the conduct of its business as now being conducted and as proposed to be
conducted. Except as set forth in Schedule 5.12, neither the Company nor any
Subsidiary is in default in any material respect under any of such franchises,
licenses, permits, consents, approvals or other authority. The rights of (and
use by) the Company and each Subsidiary with respect to such or any other
patents, patent rights, trademarks, trademark rights, tradenames, tradename
rights or copyrights
17
do not, to the best knowledge of the Company, conflict with or infringe any
rights of others and no such claim of conflict or infringement has been asserted
by any Person.
5.13 Properties.
(a) Except as set forth in Schedule 5.13, the Company does not own, and no
Subsidiary owns, any real property. The Company and each Subsidiary has good and
marketable title to its assets and other properties (including tangible and
intangible personal property) free and clear of all Liens other than Liens
disclosed in the most recent financial statements of the Company referred to in
Section 5.5(a) and other Liens which could not result in a Material Adverse
Effect. Certain real property used by the Company or its Subsidiaries in the
conduct of their respective businesses is held under lease, as identified in
Schedule 5.13 hereto.
(b) The Company and each Subsidiary has the right to and does enjoy
peaceful and undisturbed possession under all leases pursuant to which it leases
property. Neither the Company nor any Subsidiary is aware of any pending or
threatened claim or action by any lessor of any such property to terminate any
such lease. All such leases are valid and in full force and effect, and none of
such leases is in default.
(c) All of the buildings, machinery, equipment and other tangible assets
necessary for the conduct of the Company's business are in good condition and
repair, ordinary wear and tear excepted, and are usable in the ordinary course
of business. There are no defects in such assets or other conditions relating
thereto which, in the aggregate, materially adversely affect the operation or
value of such assets. The Company owns, or leases under valid leases, all
buildings, machinery, equipment and other tangible assets necessary for the
conduct of its business.
5.14 Insurance Coverage.
There is in full force and effect one or more policies of insurance issued
by financially sound and reputable insurance companies with an A.M. Best rating
of A - or better, insuring (i) the Company and its Subsidiaries, their
properties and business and (ii) the directors and executive officers of the
Company and its Subsidiaries, against such losses and risks, and in such
amounts, as are customary in the case of corporations of established reputation
engaged in the same or similar businesses of similar size and similarly
situated. The Company and its Subsidiaries have not been refused any insurance
coverage, and existing insurance coverage of directors and executive officers of
the Company and its Subsidiaries sought or applied for, and the Company and its
Subsidiaries have no reason to believe that they will be unable to renew their
existing insurance coverage upon terms at least as favorable as those presently
in effect.
5.15 Key Employees: Labor Matters.
The Company and each Subsidiary has good relationships with its employees
and has not experienced and does not expect to experience any substantial labor
problems. Neither the Company nor any Subsidiary has any knowledge as to any
intentions of any key employee or any group of employees to leave the employ of
the Company or of any Subsidiary. No employee of the Company
18
or any Subsidiary is represented by a labor union or organization, no labor
union or organization has been certified or recognized as a representative of
any such employee, there are no pending or, to the knowledge of the Company,
threatened representation campaigns concerning union representation involving
any employee or efforts of any labor union or organization (or representatives
thereof) to organize any employees.
5.16 Information True and Accurate.
None of the representations or warranties made by the Company or any
Subsidiary in this Purchase Agreement (including all exhibits and schedules
hereto) or in any Other Transaction Document, as of the date of such
representations and warranties and as of each Closing Date, and none of the
statements contained in each exhibit, schedule or report or any other
information furnished by or on behalf of the Company or any Subsidiary to
Purchaser in connection with this Purchase Agreement or any Other Transaction
Document as of the respective dates of such materials and as of each 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 the light of the circumstances under which they are made, not
misleading.
5.17 No Brokers or Finders.
None of the Company or its Subsidiaries has contracted for or otherwise
arranged for the services of any Person who has, or as a result of the
transactions contemplated herein will have, any right or valid claim against the
Company or any of its Subsidiaries or Purchaser for any commission, fee or other
compensation as a finder or broker, or in any similar capacity.
5.18 Interested Party Transactions.
Except as disclosed in the Company's most recent proxy statement filed with
the Commission or Schedule 5.18, no executive officer or director of the
Company, or shareholder who is known to the Company to own of record or
beneficially more than five percent (5%) of the Company's Common Stock, or
immediate family member of any of the foregoing, has or has had, or will have
either directly or indirectly, a material interest in any transaction, series of
similar transactions or currently proposed transaction or series of similar
transactions, to which the Company or any of its Subsidiaries is, was or is to
be a party, in which the amount involved exceeds $60,000, except for normal and
customary employment, severance and related matters.
5.19 Offering of Securities.
Neither the Company, nor any agent or other Person acting on its behalf
has, directly or indirectly, (i) offered any of the Shares (A) by any form of
general solicitation or general advertising (within the meaning of Regulation D
under the Securities Act) or (B) for sale to or solicited offers to buy any
thereof from, or otherwise approached or negotiated with respect thereto with,
any person other than Purchaser and other institutional investors each of which
the Company reasonably believed was an "accredited investor" within the meaning
of Regulation D under the Securities Act, or (ii) done or caused to be done (or
has omitted to do or to cause to be done) any act which act (or
19
which omission) would result in bringing the issuance or sale of the Shares
within the provisions of Section 5 of the Securities Act or the filing,
notification or reporting provisions of any state securities laws.
SECTION 6. REPRESENTATIONS OF THE PURCHASER
Purchaser hereby makes the representations and warranties to the Company
contained in this Section 6.
6.1 Corporate Power and Authority.
Purchaser is duly organized, validly existing and in good standing under
the laws of Germany and has all requisite power, authority and legal right to
execute, deliver, enter into, consummate and perform this Purchase Agreement and
each Other Transaction Document to which it is a party. The execution, delivery
and performance of this Purchase Agreement and each Other Transaction Document
(to the extent to which it is a party thereto) by Purchaser have been duly
authorized by all required corporate actions. Purchaser has duly executed and
delivered this Purchase Agreement and each Other Transaction Document to which
it is a party, and this Purchase Agreement and each Other Transaction Document
(to the extent to which it is a party thereto) constitutes the legal, valid and
binding obligation of Purchaser enforceable against Purchaser in accordance with
its terms, subject to bankruptcy, insolvency, reorganization, moratorium and
other similar laws relating to the rights of creditors generally.
6.2 Accredited Investor.
Purchaser is purchasing the Shares to be purchased by it for its own
account, for investment purposes and not with a present view to any distribution
thereof in violation of any applicable securities laws. It is understood that
the disposition of Purchaser's property shall at all times be within Purchaser's
control. If Purchaser should in the future decide to dispose of any of its
Shares, it is understood that it may do so but only in compliance with the
Securities Act and applicable securities laws. Purchaser is as of the date
hereof and will be as of each Closing Date an "accredited investor" as defined
in Rule 501 (a) under the Securities Act. Purchaser agrees that the Company may
place a customary Securities Act legend on the certificate(s) representing the
Shares.
SECTION 7. COVENANTS OF THE COMPANY REGARDING CERTAIN INFORMATION
7.1 Financial and Business Information.
(a) The Company will maintain, and cause each Subsidiary to maintain, a
system of accounting established and administered in accordance with sound
business practices to permit preparation of financial statements in accordance
with GAAP.
(b) The Company will deliver the following to Purchaser, so long as
Purchaser continues to hold at least thirty percent (30%) of the Shares and/or
Common Stock issuable upon conversion of the Shares (in which event Purchaser
shall be deemed to be a "Qualified Holder"):
20
(i) Budgets. As soon as practicable prior to the beginning of each
fiscal year of the Company, a budget for such fiscal year prepared on a
quarterly basis regarding the Company's operations and capital expenditures
on a consolidated basis and any material revisions or amendments made by
the Company to any budget delivered under this clause;
(ii) Reports. As soon as practicable, copies of any annual, special or
interim audit reports or management or comment letters with respect to the
Company or any of its Subsidiaries or their operations submitted to the
Company by independent public accountants;
(iii) Public Filings. As soon as practicable, copies of (x) all
financial statements, proxy materials or reports sent to the Company's or
any Subsidiary's stockholders, (y) any public or press releases and (z) all
reports, forms, registration statements or other documents filed with the
Commission pursuant to the Securities Act or the Exchange Act (which
filings pursuant to the Exchange Act the Company covenants and agrees shall
be made on a timely basis);
(iv) Board Materials. As soon as practicable and without duplication
of any of the above items, all materials furnished, from time to time, to
directors of the Company and any Subsidiary, as the case may be (including
without limitation all communications and information furnished to such
directors), and copies of minutes of meetings of the Board (and of any
executive committees) except to the extent that such materials have been
provided to any person appointed or designated by the Qualified Holder as a
director of the Company pursuant to this Agreement; provided, that the
Qualified Holder will not use any of such documents, reports or other
information for any reason or purpose other than to review the affairs and
financial condition of the Company in connection with such Qualified
Holder's investment in the Company and the compliance by the Company with
the terms and provisions of this Purchase Agreement and the Other
Transaction Documents and will hold in confidence, unless required to
disclose by judicial, regulatory or administrative process or by other
requirements of law, all documents, reports or other information obtained
from the Company, except to the extent that such documents, reports and
other information have been (i) previously known on a nonconfidential basis
by such Qualified Holder, (ii) in the public domain through no fault of
such Qualified Holder or (iii) subsequent lawfully acquired by such
Qualified Holder from sources other than the Company who, to the knowledge
of such Qualified Holder, had such documents, reports and other information
without any breach of any obligation of confidentiality; provided that any
such Qualified Holder may disclose such documents, reports and other
information to officers, directors, employees, accountants, counsel,
consultants, advisors and agents of such Qualified Holder in connection
with such Qualified Holder's review of such documents, reports or other
information so long as such Persons are informed by such Qualified Holder
to treat such information confidentially and not to use any of such
documents, reports or other information for any reason or purpose other
than in connection with such Qualified Holder's review;
(v) Other Materials. As soon as practicable and without duplication of
any of the above items, all materials furnished, from time to time, by or
on behalf of the Company to
21
any holders of indebtedness or of capital stock of the Company which
relates to a default or prospective default thereunder or a proposed waiver
of any covenant; and
(vi) Requested Information. As soon as practicable, such other
information, as may reasonably be requested by the Qualified Holder,
regarding the assets, properties, liabilities, business, affairs, results
of operations, conditions (financial or otherwise) or prospects of the
Company or any Subsidiary.
All such financial statements shall be prepared in accordance with GAAP (except
for any change in accounting principles specified in the accompanying
certificate and except that any interim financial statements may omit notes and
may be subject to normal year-end adjustments) and shall be true and correct in
all material respects as of the date and for the periods stated therein.
(c) Without limiting the foregoing provisions of this Section 7.1, the
Company agrees that, if expressly requested in writing by the Qualified Holder,
it will not deliver to such holder (until otherwise instructed by such holder)
(x) any information or materials regarding the Company or any Subsidiary
(whether described in this Section 7.1 or otherwise) that is non-public and (y)
any information (whether or not included in clause (vi)) which such holder
specifies it does not want to receive.
7.2 Inspection.
The Company will permit Qualified Holder and any authorized representative
of Qualified Holder to visit and inspect any of the properties of the Company
and its Subsidiaries, to examine their respective books and records and to
discuss with their officers their books and records and the assets, properties,
liabilities, business, affairs, results of operations, condition (financial or
otherwise) or prospects of the Company or any Subsidiary, as may be reasonably
requested.
SECTION 8. OTHER COVENANTS OF THE COMPANY
The Company covenants and agrees as follows (for so long as Purchaser is a
Qualified Holder in the case of Sections 8.1, 8.2, 8.3 and 8.4):
8.1 Purchaser Director.
(a) Purchaser shall be entitled to designate one (1) individual to serve as
a member of the Board (such director referred to herein as the "Purchaser
Director"). The Purchaser Director shall be an employee, officer or director of
Purchaser or of an Affiliate of Purchaser. The Purchaser Director shall be
elected pursuant to Section 8.1(b) hereby. Upon the expiration of the term of
such Purchaser Director, a Purchaser Director shall be designated and elected
for successive terms pursuant to the provisions hereof.
(b) The Company agrees that it shall take all actions within its power to
facilitate the election of the Purchaser Director and to cause the Purchaser
Director to be appointed as a member of the Executive Committee of the Board,
including without limitation recommending the election
22
of such Purchaser Director as is designated by Purchaser from time to time. Such
election shall be pursuant to the provisions of the Certificate of Designations
while Shares remain outstanding. Following conversion of all of the Shares into
Common Stock, such election shall be by the stockholders of the Company at any
annual meeting or special meeting of stockholders (or, in the case of a vacancy
in the Purchaser Director, by election of the remaining directors). The Company
shall, if requested by Purchaser, take all actions within its power to cause the
removal, with or without cause, of any Purchaser Director.
(c) Any action taken by a Purchaser Director in his capacity as a director
of the Company (such as approving or authorizing transactions, adopting
resolutions, etc.) shall be considered to be an action taken by such director
solely in his capacity as a director and not in any other capacity and shall not
be construed as, considered to be or deemed to be an action taken by Purchaser
and such action shall not in any way bind, obligate, estop, waive the rights of
or otherwise affect in any way Purchaser (in its capacity as stockholder or
otherwise) or the director in any capacity other than as director of the
Company.
8.2 Amendment. The Company agrees that at the next annual stockholders
meeting of the Company (scheduled for October 1999) it will recommend to its
stockholders, in the proxy statement to be distributed in connection with such
meeting, that the Articles be amended to increase the authorized shares of
Preferred Stock by 1,500,000, of which 358,334 represent the Subsequent Shares.
The Company will use its best efforts to hold such meeting by October 31, 1999
and, on the Second Closing Date, will file Articles of Amendment (the
"Amendment") reflecting such amendment to the Articles of Incorporation.
8.3 Listing of Shares.
The Company will take all such actions as may be necessary, from time to
time, to maintain the listing of its Common Stock on The National Association of
Securities Dealers, Inc. Automated Quotation System (the "Nasdaq System").
8.4 Exchange Act Registration.
(a) The Company will maintain effective a registration statement
(containing such information and documents as the Commission shall specify and
otherwise complying with the Exchange Act), under Section 12(b) or Section
12(g), whichever is applicable, of the Exchange Act, with respect to the
Company's Common Stock, and the Company will file on time such information,
documents and reports as the Commission may require or prescribe for companies
whose stock has been registered pursuant to such Section 12(b) or Section 12(g),
whichever is applicable.
(b) The Company will make whatever other filings with the Commission, or
otherwise make generally available to the public such financial and other
information, as Purchaser may deem reasonably necessary or desirable in order to
enable Purchaser to be permitted to sell Common Stock issued or issuable upon
exercise of the Shares pursuant to the provisions of Rule 144.
23
8.5 Delivery of Information for Rule 144A Transactions.
If Purchaser proposes to transfer any Shares or underlying Common Stock
pursuant to Rule 144A, the Company agrees to provide (upon the request of
Purchaser or the prospective transferee) to Purchaser and (if requested) to the
prospective transferee any financial or other information concerning the Company
and its Subsidiaries which is required to be delivered by Purchaser to any
transferee of such Shares or underlying Common Stock pursuant to Rule 144A.
8.6 Press Releases.
The Company shall submit any proposed press release, media alert, public
announcement or other similar notice related to this Purchase Agreement or any
Other Transaction Document, or any transaction contemplated hereby or thereby,
to Purchaser for its approval (which approval shall not be unreasonably
withheld) not less than three (3) Business Days (or such shorter period as may
be mandated for regulatory purposes) prior to sending any such release, alert,
announcement or notice. Purchaser shall provide the Company with comments with
respect thereto, which comments shall be duly considered (and not unreasonably
rejected) by the Company and its counsel.
8.7 Private Placement Status.
Neither the Company nor any agent nor other Person acting on the Company's
behalf will do or cause to be done (or will omit to do or to cause to be done)
any act which (or which omission) would result in bringing the issuance or sale
of the Shares or underlying Common Stock within the provisions of Section 5 of
the Securities Act or the filing, notification or reporting requirements of any
state securities law (other than in accordance with a registration and
qualification of Common Stock under the Registration Rights Agreement).
SECTION 9. AMENDMENT OF AGREEMENT
This Purchase Agreement may be amended or modified only by an instrument in
writing executed by the Company and Purchaser.
SECTION 10. REMEDIES
(a) The Company shall indemnify Purchaser and its officers, directors,
employees, agents and stockholders (collectively, the "Indemnitees") and hold
them harmless against any loss, liability, deficiency, damage, expense or cost
(including reasonable legal expenses) (collectively "Losses"), which any
Indemnitee may suffer, sustain or become subject to, directly or indirectly as a
result of (i) any misrepresentation in or breach any of the representations and
warranties of the Company contained in this Agreement or in any Other
Transaction Documents or (ii) any breach of, or failure to perform, any
agreement or covenant of the Company contained in this Agreement or any of the
Other Transaction Documents.
(b) In the case of a breach of any representation or warranty, or failure
to perform any of the agreements or covenants of the Company or any Subsidiary
contained in this Purchase
24
Agreement or the Registration Rights Agreement the Purchaser may proceed to
protect and enforce its rights by an action at law, suit in equity or other
appropriate proceeding, whether for the specific performance of any agreement or
covenant contained herein or therein or for an injunction against a violation of
any of the terms hereof or thereof or in aid of the exercise of any power
granted hereby or thereby or by law or for any other remedy (including without
limitation damages).
(c) No course of dealing and no delay on the part of any party to this
Purchase Agreement in exercising any rights or remedies shall operate as a
waiver thereof or otherwise prejudice such party's rights. No right or remedy
conferred hereby or by the Other Transaction Documents shall be exclusive of any
other right or remedy referred to herein or therein or available at law, in
equity, by statute or otherwise.
(d) Purchaser shall, in addition to other remedies provided by law, have
the right and remedy to have the provisions of this Purchase Agreement or the
Registration Rights Agreement specifically enforced by any court having equity
jurisdiction, it being acknowledged and agreed that any breach or threatened
breach of the provisions of this Purchase Agreement or the Registration Rights
Agreement will cause irreparable injury to Purchaser and that money damages will
not provide an adequate remedy. Nothing contained herein shall be construed as
prohibiting Purchaser from pursuing any other remedies available to such holder
for such breach or threatened breach, including without limitation the recovery
of damages from the Company.
SECTION 11. RESTRICTIONS ON TRANSFER
(a) Purchaser, by acceptance thereof, agrees that it will not sell or
otherwise dispose of any Shares or underlying Common Stock unless (i) such
Shares have been registered under the Securities Act and, to the extent
required, under any applicable state securities laws, (ii) such Shares or
underlying Common Stock are sold in accordance with the applicable requirements
and limitations of Rule 144 or Rule 144A or another exemption from registration
and any applicable state securities laws, (iii) if the Company has so requested,
the Company has been furnished with an opinion, in form and substance reasonably
satisfactory to the Company, from counsel to Purchaser to the effect that
registration under the Securities Act is not required for the transfer as
proposed (provided that such opinion may be conditioned upon the transferee's
assuming the obligations of a holder of Shares or underlying Common Stock under
this Section) or (iv) the Company has been furnished with a letter from the
Division of Corporate Finance of the Commission to the effect that such Division
would not recommend any action to the Commission if such proposed transfer were
effected without a registration statement effective under the Securities Act.
The Company agrees that within five (5) Business Days after receipt of any
opinion referred to in (iii) above, it will notify the holder supplying such
opinion whether such opinion is satisfactory to the Company's counsel.
(b) The Company may endorse on all Share (or underlying Common Stock)
certificates a legend stating or referring to the transfer restrictions
contained in paragraph (a) above provided, that no such legend shall be endorsed
on any certificates which, when issued, are no longer subject to the
restrictions of this Section 11; provided, further, that if a transfer is made
pursuant to Rule 144 or clause (i) or clause (iv) of paragraph (a) of this
Section 11 or if an opinion of counsel provided
25
pursuant to clause (iii) of paragraph (a) concludes that the legend is no longer
necessary, the Company will deliver upon transfer certificates without such
legends.
SECTION 12. EXPENSES
(a) Except as otherwise provided herein, each party will bear its own
expenses in connection with the preparation, production and negotiation of this
Purchase Agreement and the Other Transaction Documents
(b) The Company agrees to pay, or to cause to be paid, all transfer,
recording, stock transfer, documentary, stamp and other similar taxes and fees
levied under the laws of the United States of America or any state or local
taxing authority thereof or therein in connection with the issuance, sale or
subsequent transfer of the Shares or underlying Common Stock (other than taxes
in connection with a transfer by a holder which are imposed on or measured by
the net income of such holder) and the execution and delivery of this Purchase
Agreement, any Other Transaction Documents and any other documents or
instruments contemplated hereby or thereby and any modification of this Purchase
Agreement, and Other Transaction Documents or any such other documents or
instruments and will hold Purchaser harmless without limitation as to time
against any and all liabilities with respect to all such taxes. The Company
shall file all necessary documentation and returns with respect to such taxes.
SECTION 13. NOTICES
All notices, demands and other communications to be given or delivered
under or by reason of the provisions of this Agreement will be in writing and
will be deemed to have been given when personally delivered or mailed by
facsimile, telecopy or other electronic transmission device. Notices, demands
and communications to Purchaser and the Company will, unless another address is
specified in writing, be sent to the address indicated below:
Notices to Purchaser with a copy to:
-------------------- ---------------
DaimlerChrysler Aerospace XX Xxxxxx & Xxxxxxx LLP
Space Infrastructure 0000 Xxxxxxxxxxxx Xxxxxx, X.X., Xxxxx 000 South
1-5 Huenefeldstrasse Washington, D.C. 20004
D-28199 Bremen Attention: Xxxxxxx X. Xxxxx, Esq.
Germany Fax No.: (000) 000-0000
Attention: Xx. Xxxxxx Xxxxx Telephone: (000) 000-0000
Fax No.: 000-00-000-000-0000
26
Notices to the Company with a copy to:
---------------------- ---------------
Spacehab, Incorporated Xxxxx Xxxxxxxxxx LLP
000 X Xxxxxx, XX 1301 Avenue of the Americas
Suite 814 New York, NY 10019
Xxxxxxxxxx, XX 00000 Attention: Xxxxx X. Xxxxxx XX, Esq.
Attention: Xxxxx X. Xxxxx, President Fax No.: (000) 000-0000
Fax No.: (000) 000-0000
SECTION 14. MISCELLANEOUS
14.1. Governing Law.
This Purchase Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York (other than any conflict of laws rule
which might result in the application of the laws of any other jurisdiction).
14.2 Waiver of Jury Trial. EACH PARTY IRREVOCABLY WAIVES ANY AND ALL RIGHT
TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
14.3. Survival.
All agreements, representations and warranties, covenants, and obligations
of the Company and any Subsidiary contained in this Purchase Agreement and the
Other Transaction Documents, or any document or certificate delivered pursuant
hereto or thereto shall survive, and shall continue in effect following, the
execution and delivery of this Purchase Agreement and the Other Transaction
Documents, the closings hereunder and thereunder, any investigation at any time
made by or on behalf of Purchaser or by any other Person, the issuance, sale and
delivery of the Shares, and any disposition thereof; provided, however, that the
survival of representations and warranties shall be limited to three (3) years
after the Closings hereunder. All statements contained in any certificate or
other document delivered by or on behalf of the Company pursuant hereto shall
constitute representations and warranties by the Company hereunder.
14.4 Binding Effect, Benefit and Assignment.
(a) Neither party hereto may assign any of its rights or delegate or
otherwise transfer any of its duties under this Agreement without the prior
written consent of the other party. This provision shall not apply in the event
of any reorganization of either party or merger or acquisition of a party with
or by a third party where the reorganized, merged or successor party is
qualified to perform the terms of this Agreement.
27
(b) In addition to any assignment permitted by Section 14.4(a), Purchaser
may assign, in whole or in part, any or all of its rights (and/or obligations)
under this Purchase Agreement to any permitted transferee of any or all of its
Shares or underlying Common Stock, and (unless such assignment expressly
provides otherwise) any such assignment shall not diminish the rights Purchaser
would otherwise have under this Purchase Agreement or with respect to any
remaining Shares or underlying Common Stock held by Purchaser or with respect to
any indemnity rights (or with respect to any other provisions which expressly
provide that they survive any termination of this Purchase Agreement).
14.5. Severability.
Any provision hereof or of any Other Transaction Documents which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof or thereof, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
14.6. Headings.
The headings and captions in this Purchase Agreement and the table of
contents are for convenience of reference only and shall not define, limit or
otherwise affect any of the terms or provisions hereof.
14.7. Counterparts.
This Purchase Agreement may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which such counterparts shall together constitute one and the same
instrument, and all signatures need not appear on any one counterpart.
14.8. Entire Agreement.
This Purchase Agreement and the Other Transaction Documents, together with
any further agreements entered into by Purchaser and the Company at the closing
hereunder contain the entire agreement among Purchaser and the Company, and
supersede any prior oral or written agreements, commitments, terms or
understandings, regarding the subject matter hereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
28
IN WITNESS WHEREOF, the parties hereto have caused this Purchase Agreement
to be duly executed as of the date first above written.
SPACEHAB, INCORPORATED
By:
-------------------
Name:
Title:
Accepted and agreed to as of the date first above written by the
undersigned Purchaser:
DAIMLERCHRYSLER
AEROSPACE AG
By:
-------------------
Name:
Title:
[Signature Page to Stock Purchase Agreement]
29
Schedule 5.2(a)
---------------
Capitalization
Common Stock issued and outstanding on July 30, 1999: 11,230,902.
No preferred shares issued or outstanding at closing, however, 25,000 shares of
Series A Junior Preferred are reserved for issuance in connection with a
Stockholders' Rights Plan.
Sch. -1
Schedule 5.2(b)
---------------
Shares reserved for issuance by Spacehab, Incorporated
(except common stock issuable upon conversion
of Series B Senior Convertible Preferred Stock)
(1) 250,000 shares of common stock are reserved for issuance upon exercise of
options granted under the Company's 1995 Directors' Stock Option Plan.
(2) 2,750,000 shares of common stock are reserved for issuance upon exercise of
options granted under the Company's 1994 Stock Incentive Plan as amended in
October 21, 1997.
(3) 1,500,000 shares of common stock are reserved for issuance upon exercise of
options granted under the Company's 1997 Employee Stock Purchase Plan.
(4) 270,000 shares of common stock are reserved for issuance upon exercise of
options to purchase such number, pursuant to Option Agreements, dated July
1, 1998, between the Company and each of Xxxxxx X. Xxxxxx, X.X. Xxxxx and
Xxxxxxx X. Xxxxxxx. Each option agreement is for 90,000 shares and the
options vest on July 1, 1999. The exercise price for each option is $14.00
per share.
(5) Pursuant to consulting Agreements dated August 25, 1996 and August 15, 1997
Xxxxxx X. Xxxxxxx has an option to purchase 20,000 shares of common stock.
(6) Warrants were issued to five individuals for a total of 53,000 shares of
Company common stock. The warrants were issued to the following individuals
on the following dates and expire on June 30, 2002:
Xxxx Xxxxxxx, issued June 30, 1997;
Xxxx X. Xxxxxx, issued June 30, 1997;
Xxxxx Xxxxxx, issued June 30, 1997;
Xxxx Xxxxxxx, issued June 30, 1997; and
Xxxx Xxxxxxx, issued June 30, 1997.
They are exercisable at $9.00 per share.
(7) 4,642,201 shares of common stock are reserved for conversion of the
Company's 8% Subordinated Convertible Notes due 2007. Please see the
Indenture between the Company and First Union National Bank, dated October
15, 1997.
(8) Stock options which were issued to employees and former employees and were
not issued pursuant to one of the Company's option plans are outstanding
and exercisable for a total of 173,804 shares.
Sch.-2
Schedule 5.2(c)
---------------
Outstanding options, warrant, subscriptions, rights, calls,
convertible agreements or plans or similar provisions of law
(1) 270,000 shares of common stock are reserved for issuance upon exercise of
options to purchase such number, pursuant to Option Agreements, dated July
1, 1998, between the Company and each of Xxxxxx X. Xxxxxx, X.X. Xxxxx and
Xxxxxxx X. Xxxxxxx. Each option agreement is for 90,000 shares and the
options vest on July 1, 1999. The exercise price for each option is $14.00
per share.
(2) Pursuant to consulting Agreements dated August 25, 1996 and August 15, 1997
Xxxxxx X. Xxxxxxx has an option to purchase 20,000 shares of common stock.
(3) Options to purchase 2,600,417 shares of common stock are granted and
outstanding and remain outstanding under the 1994 Incentive Stock Plan and
the 1995 Directors' Stock Option Plan.
(3) Participants in the Company's 1997 Employee Stock Purchase Plan have set
aside approximately $18,000 for the purchase of Company common stock on the
next purchase date under this plan, being September 30, 1999.
(5) Warrants were issued to five individuals for a total of 53,000 shares of
Company common stock. The warrants were issued to the following individuals
on the following dates and expire on June 30, 2002:
Xxxx Xxxxxxx, issued June 30, 1997;
Xxxx X. Xxxxxx, issued June 30, 1997;
Xxxxx Xxxxxx, issued June 30, 1997;
Xxxx Xxxxxxx, issued June 30, 1997; and
Xxxx Xxxxxxx, issued June 30, 1997.
They are exercisable at $9.00 per share.
(6) 4,642,201 shares of common stock are reserved for conversion of the
Company's 8% Subordinated Convertible Notes due 2007. Please see the
Indenture between the Company and First Union National Bank, dated October
15, 1997.
(7) Stock options which were issued to employees and former employees and were
not issued pursuant to one of the Company's option plans are outstanding
and exercisable for a total of 173,804 shares.
Sch.-3
Schedule 5.2(d)
---------------
Registration Rights and similar agreements
(1) Registration Rights Agreement dated October 15, 1997 between Spacehab,
Incorporated and Credit Suisse First Boston Corporation, CIBC Wood Gundy
Securities Corp. and Xxxxxxxxxxx & Co., Inc., which is incorporated into
the Indenture dated October 15, 1997 between the Company and First Union
National Bank, Trustee for the Company's 8% Convertible Subordinated Notes
due 2007.
(2) Registration Rights for 1,899,998 shares of common stock in favor of Poly
Ventures, BEA, Chase Manhattan Capital Corporation, Mitsubishi, Mitsubishi
Heavy Industries, Ltd., Mitsubishi International Corporation, MTBC Finance,
Inc., Japan Airlines Company, Ltd., Shimizu Corporation, Toro Engineering
Corporation and certain other corporate stockholders. The registration
rights are described in the Company's Offering Circular for the 8%
Convertible Subordinated Notes due 2007.
(3) Registration rights incidental to warrants for up to 641,940 shares of
common stock have been granted. However, there are outstanding warrants for
only 53,000 shares which carry these registration rights. These warrants
are held by Xxxx Xxxxxxx, Xxxx X. Xxxxxx, Xxxxx Xxxxxx, Xxxx Xxxxxxx and
Xxxx Xxxxxxx and are described in further detail on Schedules 5.2(b) and
5.2(c).
Sch.-4
Schedule 5.2(e)
---------------
Shareholder agreements, voting agreements,
voting trusts, proxies or other agreements or
understandings regarding capital stock
None.
Sch.-5
Schedule 5.2(f)
---------------
Anti-dilution protections and other adjustment provisions
except for Certificate of Designations
None.
Sch.-6
Schedule 5.3
------------
Subsidiaries (related to representation
that no equity or debt held by Spacehab in any other entity)
(1) Xxxxxxx Engineering Corporation, a Colorado corporation.
(2) Astrotech Space Operations, Inc., a Delaware corporation.
Sch.-7
Section 5.4(b)(iii)
-------------------
Required consents, waivers, consents,
approvals, licenses, permits, orders,
authorizations, declarations, registrations,
qualifications and filings
None.
Sch.-8
Schedule 5.4(b)(iv)
-------------------
Anti-dilution clauses of outstanding securities
which become operative or give rise to
pre-emptive rights
None.
Sch.-9
Schedule 5.5(a)(iii)
--------------------
Other financial information delivered
(1) February 21, 1999 financial outlook to the Board of Directors
(2) Financial Models dated May 6, 1999 (1:02 p.m. and 3:37 p.m.)
(3) Schedules A - Operating Plan, B - Balance Sheets, C - Cash Flow Analysis, D
- Cash Flow Analysis and Discounted Cash Flow Summary dated May 17, 1999
(1:21 p.m.)
(4) Report regarding marketing, dated May 20, 1999.
Sch.-10
Schedule 5.5(b)
---------------
Events since March 31, 1999 which could
have Material Adverse Effect
None.
Sch.-11
Schedule 5.5(c)
---------------
Obligations and liabilities,
contingent or otherwise, not fully disclosed
and provided for in financial statements
except for liabilities arising in the ordinary course
since March 31, 1999 which would not have
a Material Adverse Effect
(1) On April 30, 1999, the Company increased its indebtedness by drawing an
additional $1,000,000 under its credit facility with CIT Group. The terms
of this credit facility are described in the Loan and Security Agreement
dated July 14, 1997 between the Company and CIT Group/Equipment Financing.
Sch.-12
Schedule 5.6
------------
Actions, suits, proceedings, investigations, claims
pending or threatened which
(i) question transaction documents;
(ii) could have a Material Adverse Effect, or
(iii) would be required to be filed with the SEC
and has not been so filed.
None.
Sch.-13
Schedule 5.10(d)
----------------
Hazardous Materials affecting any site which
could give rise to an
Environmental Claim
Astrotech
---------
(1) Chemical Descriptions CAS Number
--------------------- ----------
Hydrazine anhydrous 302012
Monomethylhydrazine 60344
Nitrogen Tetroxide 00000-00-0
1. Limited quantities of Isopropyl Alcohol, Methyl Ethyl Ketone and other
solvents are maintained for cleaning purposes. Miscellaneous
janitorial and maintenance supplies including chemicals are also
utilized at the site. In addition, customers use hazardous materials
while occupying the facility. However, they bring such chemicals on
site and are responsible for removing and disposing of same. (Please
refer to attached chemical listing which identifies chemicals stored
at the site by Astrotech, as well as those chemicals stored by
customers.)
(2) Astrotech Space Operations, Inc., 0000 Xxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxx
Facility
1. The facility contains electrical transformers, owned by the Florida
Power and Light Company, which the utility presumes contain between 50
and 500 parts per million of PCBs. FP&L is responsible for regulatory
compliance and maintenance of the facility. The facility contains
fluorescent light fixtures, which may contain ballasts (small
capacitors) containing PCBs.
2. The facility utilizes two 6000 gallon underground storage tanks to
receive and store washwater used during the cleaning and fueling of
satellites. The washwater is treated by air stripping to remove
volatile organic compounds prior to discharge to the tanks. The tanks
are periodically pumped out by a waste disposal contractor.
2. The facility contains ceiling tiles, floor tiles, roofing material,
and wallboard/joint compound which typically were manufactured in the
past, and continue to be manufactured using some asbestos fibers,
which are bound into a solid matrix and thus are not considered to be
friable. No asbestos survey has been done to determine whether, in
fact, such materials contain asbestos.
Sch.-14
3. The facility generates waste oil, which may contain small
concentrations of hazardous substances, and uses various alcohols,
degreasing and cleaning agents, all of which are temporarily stored
onsite in 55 gallon drums.
4. In the normal course of operations at the Company's facilities,
customers of the Company and, less frequently, the Company itself,
bring onto the Company's property, store and use Hazardous Material,
usually in small quantities, the highest volumes of which pertain to
anhydrous hydrozine, momomethylhydraxine and nitrogen tetroxide.
Customers who bring chemicals onto the Company's Property are required
by the Company to remove any wastes or residuals when they leave.
(3) Astrotech Space Operations, Inc., Xxxxxxxxxx Air Force Base, Santa Xxxxxxx
County, California
1. The facility contains one pad-mounted liquid dialectric
fluid-containing transformer which might contain PCBs, and it contains
fluorescent lighting fixtures, some of which may include ballasts
(capacitors) that contain PCBs.
2. The facility is situated on property owned by the United States and
administered by the United States Air Force. The land was previously
used by the Air Force for other purposes, which would have involved
the disposal or release of Hazardous Material. Air Force environmental
site assessments indicate an absence of Hazardous Material on the
property.
3. The facility contains ceiling tiles, floor tiles, roofing material,
and wallboard/joint compound and various types of mastic, which
typically were manufactured in the past, and continue to be
manufactured using some asbestos fibers, which are bound into a solid
matrix and thus are not considered to be friable. No asbestos survey
has been done to determine whether, in fact, such materials contain
asbestos.
4. In the normal course of operations at the Company's facilities,
customers of the Company, and, less frequently, the Company itself,
bring onto the Company's Property, store and use Hazardous Material,
usually in small quantities, the highest volumes of which pertain to
anhydrous hydrozine, momomethylhydraxine and nitrogen tetroxide.
Customers who bring chemicals onto the Company's Property are required
by the Company to remove any wastes or residuals when they leave. The
facility contains an internal fully enclosed concrete trench catchment
to which spills of hazardous substances that occur during satellite
preparation would drain.
(4) Spacehab, Incorporated Payload Processing Facility, 000 Xxxxxxxx Xxxxx,
Xxxx Xxxxxxxxx, Xxxxxxx
Sch.-15
1. Hazardous Materials, as broadly defined in the Certificate, are stored
and used at the facility in small quantities. They are stored in a
separate flammable materials storage building. Various paints,
petroleum products and chemicals are used by the Company or brought
onto the site and are used by customers of the Company. Liquid
chemical wastes are stored for less than 90 days and are removed by a
large waste management contractor, Safety Kleen or another chemical
waste contractor.
2. The facility contains an electrical transformer, owned by the Florida
Power and Light Company, which the utility presumes contain between 50
and 500 parts per million of PCBs. FP&L is responsible for regulatory
compliance and maintenance of the transformer. The facility also
contains fluorescent light fixtures, which may contain ballasts (small
capacitors) containing PCBs.
3. The facility contains ceiling tiles, floor tiles, roofing material,
and wallboard/joint compound which typically were manufactured in the
past, and continue to be manufactured using some asbestos fibers,
which are bound into a solid matrix and thus are not considered to be
friable. No asbestos survey has been done to determine whether, in
fact, such materials contain asbestos.
Sch.-16
Schedule 5.10(e)
----------------
Transportation, treatment, storage, handling, disposal
or transportation of Hazardous Material
which could result in Environmental Claim
Astrotech
---------
(1) Chemical Descriptions CAS Number
--------------------- ----------
Hydrazine anhydrous 302012
Monomethylhydrazine 60344
Nitrogen Tetroxide 00000-00-0
1. Limited quantities of Isopropyl Alcohol, Methyl Ethyl Ketone and other
solvents are maintained for cleaning purposes. Miscellaneous
janitorial and maintenance supplies including chemicals are also
utilized at the site. In addition, customers use hazardous materials
while occupying the facility. However, they bring such chemicals on
site and are responsible for removing and disposing of same. (Please
refer to attached chemical listing which identifies chemicals stored
at the site by Astrotech, as well as those chemicals stored by
customers.)
(2) Astrotech Space Operations, Inc., 0000 Xxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxx
Facility
1. In the normal course of operations at the Company's facilities,
customers of the Company and, less frequently, the Company itself,
bring onto the Company's Property, store and use Hazardous Material,
usually in small quantities, the highest volumes of which pertain to
anhydrous hydrozine, momomethylhydraxine and nitrogen tetroxide.
Customers who bring chemicals onto the Company's Property are required
by the Company to remove any wastes or residuals when they leave.
(3) Astrotech Space Operations, Inc., Xxxxxxxxxx Air Force Base, Santa Xxxxxxx
County, California
1. In the normal course of operations at the Company's facilities,
customers of the Company, and, less frequently, the Company itself,
bring onto the Company's Property, store and use Hazardous Material,
usually in small quantities, the highest volumes of which pertain to
anhydrous hydrozine, momomethylhydraxine and nitrogen tetroxide.
Customers who bring chemicals onto the Company's Property are required
by the Company to remove any wastes or residuals when they leave. The
facility contains an internal fully enclosed concrete trench catchment
to which spills of hazardous substances that occur during satellite
preparation would drain.
Sch.-17
(4) Spacehab, Incorporated Payload Processing Facility, 000 Xxxxxxxx Xxxxx,
Xxxx Xxxxxxxxx, Xxxxxxx
1. Hazardous Materials are stored and used at the facility in small
quantities. They are stored in a separate flammable materials storage
building. Various paints, petroleum products and chemicals are used by
the Company or brought onto the site and are used by customers of the
Company. Liquid chemical wastes are stored for less than 90 days and
are removed by a large waste management contractor, Safety Kleen or
another chemical waste contractor.
Sch.-18
Schedule 5.10(g)
----------------
Underground storage tanks, PCBs, asbestos
(1) Astrotech Space Operations, Inc., 0000 Xxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxx
Facility
1. The facility contains electrical transformers, owned by the Florida
Power and Light Company, which the utility presumes contain between 50
and 500 parts per million of PCBs. FP&L is responsible for regulatory
compliance and maintenance of the facility. The facility contains
fluorescent light fixtures, which may contain ballasts (small
capacitors) containing PCBs.
2. The facility utilizes two 6000 gallon underground storage tanks to
receive and store washwater used during the cleaning and fueling of
satellites. The washwater is treated by air stripping to remove
volatile organic compounds prior to discharge to the tanks. The tanks
are periodically pumped out by a waste disposal contractor.
3. The facility contains ceiling tiles, floor tiles, roofing material,
and wallboard/joint compound which typically were manufactured in the
past, and continue to be manufactured using some asbestos fibers,
which are bound into a solid matrix and thus are not considered to be
friable. No asbestos survey has been done to determine whether, in
fact, such materials contain asbestos.
(2) Astrotech Space Operations, Inc., Xxxxxxxxxx Air Force Base, Santa Xxxxxxx
County, California
1. The facility contains one pad-mounted liquid dialectric
fluid-containing transformer which might contain PCBs, and it contains
fluorescent lighting fixtures, some of which may include ballasts
(capacitors) that contain PCBs.
2. The facility contains ceiling tiles, floor tiles, roofing material,
and wallboard/joint compound and various types of mastic, which
typically were manufactured in the past, and continue to be
manufactured using some asbestos fibers, which are bound into a solid
matrix and thus are not considered to be friable. No asbestos survey
has been done to determine whether, in fact, such materials contain
asbestos.
(3) Spacehab, Incorporated Payload Processing Facility, 000 Xxxxxxxx Xxxxx,
Xxxx Xxxxxxxxx, Xxxxxxx
1. The facility contains an electrical transformer, owned by the Florida
Power and Light Company, which the utility presumes contain between 50
and 500 parts per million of PCBs. FP&L is responsible for regulatory
compliance and maintenance of the transformer. The facility also
contains fluorescent light fixtures, which may contain ballasts (small
capacitors) containing PCBs.
Sch.-19
2. The facility contains ceiling tiles, floor tiles, roofing material,
and wallboard/joint compound which typically were manufactured in the
past, and continue to be manufactured using some asbestos fibers,
which are bound into a solid matrix and thus are not considered to be
friable. No asbestos survey has been done to determine whether, in
fact, such materials contain asbestos.
Sch.-20
Schedule 5.10(h)
----------------
Environmental investigations, studies, audits, tests
reviews or other analyses
(1) Certificate Regarding Environmental Matters from Astrotech to the CIT
Group/Equipment Financing, Inc. See items 4(2) through (4) on Schedule
5.10(d)
(2) SPACEHAB, Incorporated: Phase I Environmental Site Assessment of Cape
Canaveral, FL Facility (7-9-97).
(3) Astrotech Space Operations, Inc.: Phase I Environmental Site Assessment of
Titusville, FL Facility (7-9-97).
(4) Astrotech Space Operations, Inc.: Phase I Environmental Site Assessment of
Xxxxxxxxxx Air Force Base, CA Facilities (7-10-97).
Sch.-21
Schedule 5.12
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Defaults in a material respect under any franchise,
license, permit, consent, approval
or other authority
(1) By letter dated July 7, 1997 from J. Xxxx Xxxxx of XxXxxxxxx Xxxxxxx to
Xxxxxxx Xxxxxx of Spacehab, Incorporated, the Company was advised of
XxXxxxxxx Xxxxxxx' objection to the Company's reference to certain
trademarks of XxXxxxxxx Xxxxxxx in promotional material. The Company no
longer refers to XxXxxxxxx Xxxxxxx in marketing materials and other
corporate communications.
Sch.-22
Schedule 5.13
-------------
Owned and Leased Properties
Owned Property
--------------
(1) Spacehab, Incorporated facility located at 000 Xxxxxxxx Xxxxx, Xxxx
Xxxxxxxxx, XX 00000. The Company owns the building on this site but leases
the land upon which the building is constructed through the lease described
in item (9) of this schedule. This facility is subject to an Indenture,
dated July 14, 1997, in favor of CIT Group/Equipment Financing, Inc.
(2) Astrotech Space Operations, Inc. facility located at 0000 Xxxxxxx Xx.,
Xxxxxxxxxx, XX 00000.
(3) Astrotech Space Operations, Inc. facilities located at Xxxxxxxxxx Air Force
Base. The Company owns four buildings on this site but leases the land upon
which the buildings are constructed through a lease with the Secretary of
the Air Force.
Leased Property
---------------
(1) Property at 000 Xxxxx Xxxxx Xx., Xxxxx #000, Xxxxxxx, XX under lease
between Xxxxxxx Engineering Corporation and CD UP LP a wholly-owned
subsidiary of Xxxxx Diversified LLC, successor in interest to X.X. Xxxxxx
Development Corporation.
(2) Property at 00000 Xxxxx Xxx Xxxx, Xxxxx #000, Xxxxxxx, XX under lease
between Xxxxxxx Engineering Corporation and Nassau Development Company,
dated February 19, 1998.
(3) Property at 0000 Xxxxxx Xxx, Xxxxxxx, XX under Gemini Office Building
Lease, dated January 14, 1998, between Spacehab, Incorporated and KBS
Capital I/LP, L.P.
(4) Property at 0000 Xxx Xxxx, Xxxxx #000, Xxxxxxxxx, XX under Capital Office
Park Lease, as amended, dated April 23, 1998 between Astrotech Space
Operations, Inc. and Eleventh Springhill Lake Associates L.L.L.P.
(5) Property at 920, 926 and 000 Xxxxxx Xxx., Xxxxxxx, XX under Standard
Commercial Lease between Xxxxxxx Engineering Corporation and Lakeland
Development dated February 1, 1998.
(6) Property on Xxxxxxxxxx Air Force Base under Office Building Lease
Agreement, dated October 6, 1993 between Astrotech Space Operations, Inc.
and the Secretary of the Air Force (Lease number SPCVAN - 2-94-001).
Sch.-23
(7) Property at 000 X Xxxxxx, XX, Xxxxx #000, Xxxxxxxxxx, XX, dated December
16, 1998 between Spacehab, Incorporated and The Washington Design Center,
L.L.C.
(8) Property at 00000 Xxxxx, Xxxxxxx, XX under lease agreement dated August 1,
1999 between Xxxxxxx Engineering Corporation and Computer Extension
Systems, Inc.
(9) Property located at 000 Xxxxxxxx Xx., Xxxx Xxxxxxxxx, XX under a lease
between Spacehab, Incorporated and the Canaveral Port Authority. Spacehab,
Incorporated originally occupied this property under a Sublease with
Eastern American Teak Corporation, dated April 9, 1991. In August of 1997,
the Canaveral Port Authority consented to the assignment of that Sublease
from Eastern American Teak Corporation to Spacehab, Incorporated.
Sch.-24
Schedule 5.18
-------------
Interested party transactions
(for officers, directors, 5 % percent holders;
involving amounts in excess of $60,000,
except for employment, severance and similar)
(1) On January 15, 1999, the Compensation Committee of the Board of Directors
of the Company revised the terms of employment for the Company's Chairman
and Chief Executive Officer, Xxxxxxx X. Xxxxxxxx. The revised terms are set
forth in the Amended and Restated Employment and Non-Interference
Agreement, dated January 15, 1999 between the Company and Xx. Xxxxxxxx and
in the Consulting Agreement dated January 15, 1999 between the Company and
Xx. Xxxxxxxx.
(2) On January 15, 1999, the Compensation Committee of the Board of Directors
of the Company approved a revision to the terms of employment for the
Company's President, Xxxxx Xxxxx. Upon the successful completion of a
transaction constituting a change in control of the Company, Xx. Xxxxx will
be entitled to receive a special bonus consisting of a lump sum payment
equal to three times the highest of the last three annual bonuses paid to
Xx. Xxxxx. This bonus shall be in addition to, and shall not reduce in any
way, the other payments and benefits to which Xx. Xxxxx may become entitled
under any other agreement, plan or otherwise.
Sch.-25
