EXHIBIT 99.1
This securities purchase agreement (the "purchase agreement") contains certain
Representations and warranties (the "representations") by Spacedev, inc. (the
"company") in favor of the buyers named therein (the "buyers"). The purchase
Agreement states in section 9(h) that the purchase agreement is intended for the
Parties thereto, their respective permitted successors and assigns, and not for
Any other person. The purchase agreement is filed in accordance with the rules
Of the securities and exchange commission as a material agreement, and is
Intended by the company solely as a record of the material agreement the company
Has reached with the buyers. The filing of the purchase agreement is not
Intended to waive or modify section 9(h) thereof, or as a mechanism to update,
Supersede or otherwise modify prior disclosures of information and risks
Concerning the company which the company has made to its shareholders.
Investors and potential investors should also be aware that the representations
Are qualified by information in confidential disclosure schedules that Spacedev
Has delivered to the buyers (the "disclosure schedules"). The disclosure
Schedules contain information that modifies, qualifies and creates exceptions to
The representations.
Investors and potential investors should also be aware that certain
Representations made to the buyers are not intended to be affirmative
Representations of facts, situations or circumstances, but are instead designed
And intended to allocate certain risks between the company, on the one hand, and
The buyers, on the other hand. The use of representations and warranties to
Allocate risk is a standard device in investment and other commercial contracts.
Accordingly, shareholders should not rely on the representations as affirmations
Or characterizations of information concerning the company as of the date of the
Purchase agreement, or as of any other date.
SECURITIES PURCHASE AGREEMENT
SECURITIES PURCHASE AGREEMENT (the "AGREEMENT"), dated as of October 31,
2005, by and among SpaceDev, Inc., a Colorado corporation, with headquarters
located at 00000 Xxxxx Xxxxx Xxxxx, Xxxxxxxxxx 00000 (the "COMPANY"), and the
investors listed on the Schedule of Buyers attached hereto (individually, a
"BUYER" and collectively, the "BUYERS").
WHEREAS:
A. The Company and each Buyer is executing and delivering this Agreement in
reliance upon the exemption from securities registration afforded by Section
4(2) of the Securities Act of 1933, as amended (the "1933 ACT"), and Rule 506 of
Regulation D ("REGULATION D") as promulgated by the United States Securities and
Exchange Commission (the "SEC") under the 1933 Act.
B. Each Buyer wishes to purchase, and the Company wishes to sell, upon the
terms and conditions stated in this Agreement, (i) that aggregate number of
shares of the Common Stock, par value $0.001 per share, of the Company (the
"COMMON STOCK"), set forth opposite such Buyer's name in column (3) on the
Schedule of Buyers (which aggregate amount for all Buyers together shall be
2,032,520) shares of Common Stock and shall collectively be referred to herein
as the "COMMON SHARES") and (ii) a warrant to acquire up to that number of
additional shares of Common Stock set forth opposite such Buyer's name in column
(4) on the Schedule of Buyers (the "WARRANTS"), in substantially the form
attached hereto as Exhibit A (as exercised, collectively, the "WARRANT SHARES").
C. Contemporaneously with the execution and delivery of this Agreement, the
parties hereto are executing and delivering a Registration Rights Agreement,
substantially in the form attached hereto as Exhibit B (the "REGISTRATION RIGHTS
AGREEMENT") pursuant to which the Company has agreed to provide certain
registration rights with respect to the Common Shares, and the Warrant Shares
under the 1933 Act and the rules and regulations promulgated thereunder, and
applicable state securities laws.
D. The Common Shares, the Warrants and the Warrant Shares collectively are
referred to herein as the "SECURITIES".
NOW, THEREFORE, the Company and each Buyer hereby agree as follows:
1. PURCHASE AND SALE OF COMMON SHARES AND WARRANTS.
(a) Purchase of Common Shares and Warrants. Subject to the satisfaction (or
waiver) of the conditions set forth in Sections 6 and 7 below, the Company shall
issue and sell to each Buyer, and each Buyer severally, but not jointly, agrees
to purchase from the Company on the Closing Date (as defined below), the number
of Common Shares as is set forth opposite such Buyer's name in column (3) on the
Schedule of Buyers,
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along with the Warrants to acquire up to that number of Warrant Shares as is set
forth opposite such Buyer's name in column (4) on the Schedule of Buyers (the
"CLOSING").
(b) Purchase Price. The purchase price for the Common Shares and related
Warrants to be purchased by each Buyer at the Closing shall be the amount set
forth opposite such Buyer's name in column (5) of the Schedule of Buyers (the
"PURCHASE PRICE").
(c) Closing Date. The date and time of the Closing (the "CLOSING DATE")
shall be 10:00 a.m., New York City Time, on the date hereof (or such other date
and time as is mutually agreed to by the Company and each Buyer).
(d) Form of Payment. On the Closing Date, (i) each Buyer shall pay its
respective Purchase Price to the Company for the Common Shares and Warrants to
be issued and sold to such Buyer at the Closing, by wire transfer of immediately
available funds in accordance with the Company's written wire instructions, and
(ii) the Company shall deliver to each Buyer (A) one or more stock certificates,
free and clear of all restrictive and other legends (except as expressly
provided in Section 2(g) hereof), evidencing the number of Common Shares such
Buyer is purchasing as is set forth opposite such Buyer's name in column (3) of
the Schedule of Buyers and (B) a Warrant pursuant to which such Buyer shall have
the right to acquire such number of Warrant Shares as is set forth opposite such
Buyer's name in column (4) of the Schedule of Buyers, in all cases duly executed
on behalf of the Company and registered on the books of the Company in the name
of such Buyer.
2. BUYER'S REPRESENTATIONS AND WARRANTIES.
Each Buyer represents and warrants with respect to only itself that:
(a) No Public Sale or Distribution. Such Buyer is (i) acquiring the Common
Shares and the Warrants and (ii) upon exercise of the Warrants will acquire the
Warrant Shares issuable upon exercise thereof, in the ordinary course of
business for its own account and not with a view towards, or for resale in
connection with, the public sale or distribution thereof, except pursuant to
sales registered or exempted under the 1933 Act and such Buyer does not have a
present arrangement or understanding to effect, directly or indirectly, any
distribution of the Securities to or through any person or entity; provided,
however, that by making the representations herein, such Buyer does not agree to
hold any of the Securities for any minimum or other specific term and reserves
the right to dispose of the Securities at any time in accordance with or
pursuant to a registration statement or an exemption under the 1933 Act.
(b) Qualified Institutional Buyer Status. Such Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A the 1933 Act.
(c) Reliance on Exemptions. Such Buyer understands that the Securities are
being offered and sold to it in reliance on specific exemptions from the
registration requirements of United States federal and state securities laws and
that the Company is relying in part upon the truth and accuracy of, and such
Buyer's compliance with, the representations, warranties, agreements,
acknowledgments and understandings of such Buyer set forth herein in order to
determine the availability of such exemptions and the eligibility of such Buyer
to acquire the Securities.
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(d) Information. Such Buyer and its advisors, if any, have been furnished
with all materials relating to the business, finances and operations of the
Company and materials relating to the offer and sale of the Securities which
have been requested by such Buyer. Such Buyer and its advisors, if any, have
been afforded the opportunity to ask questions of the Company. Neither such
inquiries nor any other due diligence investigations conducted by such Buyer or
its advisors, if any, or its representatives shall modify, amend or affect such
Buyer's right to rely on the Company's representations and warranties contained
herein. Such Buyer understands that its investment in the Securities involves a
high degree of risk and is able to afford a complete loss of such investment.
Such Buyer has sought such accounting, legal and tax advice as it has considered
necessary to make an informed investment decision with respect to its
acquisition of the Securities.
(e) No Governmental Review. Such Buyer understands that no United States
federal or state agency or any other government or governmental agency has
passed on or made any recommendation or endorsement of the Securities or the
fairness or suitability of the investment in the Securities nor have such
authorities passed upon or endorsed the merits of the offering of the
Securities.
(f) Transfer or Resale. Such Buyer understands that except as provided in
the Registration Rights Agreement: (i) the Securities have not been and are not
being registered under the 1933 Act or any state securities laws, and may not be
offered for sale, sold, assigned or transferred unless (A) subsequently
registered thereunder or (B) such Buyer shall have delivered to the Company an
opinion of counsel, in a form reasonably acceptable to the Company, to the
effect that such Securities to be sold, assigned or transferred may be sold,
assigned or transferred pursuant to an exemption from such registration; (ii)
any sale of the Securities made in reliance on Rule 144 or Rule 144A promulgated
under the 1933 Act ("collectively, "RULE 144") may be made only in accordance
with the terms of Rule 144 and further, if Rule 144 is not applicable, any
resale of the Securities under circumstances in which the seller (or the Person
(as defined in Section 3(q)) through whom the sale is made) may be deemed to be
an underwriter (as that term is defined in the 0000 Xxx) may require compliance
with some other exemption under the 1933 Act or the rules and regulations of the
SEC thereunder; and (iii) neither the Company nor any other Person is under any
obligation to register the Securities under the 1933 Act or any state securities
laws or to comply with the terms and conditions of any exemption thereunder.
Notwithstanding the foregoing, the Securities may be pledged in connection with
a bona fide margin account secured by the Securities and such pledge of
Securities shall not be deemed to be a transfer, sale or assignment of the
Securities hereunder, and no Buyer effecting such a pledge of Securities shall
be required to provide the Company with any notice thereof or otherwise make any
delivery to the Company pursuant to this Agreement or any other Transaction
Document, including, without limitation, this Section 2(f); provided, that in
order to make any sale, transfer or assignment of Securities, such Buyer and its
pledgee makes such disposition in accordance with or pursuant to a registration
statement or an exemption under the 1933 Act.
(g) Legends. Such Buyer understands that the certificates or other
instruments representing the Common Shares and the Warrants and, until such time
as the resale of the Common Shares and the Warrant Shares have been registered
under the 1933 Act as contemplated by the Registration Rights Agreement, the
stock certificates representing the Warrant Shares, except as set forth below,
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shall bear any legend as required by the "blue sky" laws of any state and a
restrictive legend in substantially the following form (and a stop-transfer
order may be placed against transfer of such stock certificates):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE
SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED, ASSIGNED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF (A) AN
EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL, IN A FORM REASONABLY
ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID
ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT SECURED BY THE SECURITIES.
(h) Validity; Enforcement. This Agreement and the Registration Rights
Agreement have been duly and validly authorized, executed and delivered on
behalf of such Buyer and shall constitute the legal, valid and binding
obligations of such Buyer enforceable against such Buyer in accordance with
their respective terms, except as such enforceability may be limited by general
principles of equity or to applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation and other similar laws relating to, or affecting
generally, the enforcement of applicable creditors' rights and remedies.
(i) No Conflicts. The execution, delivery and performance by such Buyer of
this Agreement and the Registration Rights Agreement and the consummation by
such Buyer of the transactions contemplated hereby and thereby will not (i)
result in a violation of the organizational documents of such Buyer or (ii)
conflict with, or constitute a default (or an event which with notice or lapse
of time or both would become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation of, any agreement,
indenture or instrument to which such Buyer is a party, or (iii) result in a
violation of any law, rule, regulation, order, judgment or decree (including
federal and state securities laws) applicable to such Buyer, except in the case
of clauses (ii) and (iii) above, for such conflicts, defaults, rights or
violations which would not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the ability of such Buyer to
perform its obligations hereunder.
(j) Residency. If the Buyer is an individual, such Buyer resides in the
jurisdiction identified in the address of such Buyer set forth on the Schedule
of Buyers; if such Buyer is a partnership, corporation, limited liability
company or other entity, then the office or offices of such Buyer in which its
investment decision was made is located at the address or addresses of such
Buyer set forth on the Schedule of Buyers.
(k) No Prior Short Selling. At no time during the 30 days prior to the
Closing has such Buyer engaged in or effected, in any manner whatsoever,
directly or indirectly, any sale of Common Stock (a "SHORT SALE") which
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such Buyer is not deemed to own under the provisions of Rule 200(b) of
Regulation SHO promulgated under the Securities Exchange Act of 1934, as amended
(the "1934 ACT").
(l) Commissions. Such Buyer has not incurred any obligation for any
finder's or broker's or agent's fees or commissions in connection with the
transactions contemplated hereby.
(m) No Broker-Dealer. Such Buyer is not required to be registered as a
broker-dealer pursuant to Xxxxxxx 00 xx xxx 0000 Xxx. (x) Beneficial Ownership.
At the Closing, such Buyer will not, after giving effect to the Securities
purchased hereunder, beneficially own in excess of 9.99% of the number of shares
of Common Stock of the Company then outstanding, determined in accordance with
Rule 13d-3 of the Exchange Act).
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company makes the following representations and warranties to each
Buyer, subject to information set forth in the disclosure schedule the Company
has delivered to the Buyers on the date hereof (the "Company Disclosure
Schedule") and the information set forth in the SEC Documents (together, the
"Disclosure Materials"). The disclosure set forth in the Disclosure Materials
shall qualify each subsection of this Section 3 where the applicability to such
subsection is reasonably inferable from the disclosure made.
(a) Organization and Qualification. Each of the Company and its
"SUBSIDIARIES" (which for purposes of this Agreement means any entity in which
the Company, directly or indirectly, owns more than 50% of the equity interests)
are corporations duly organized and validly existing in good standing under the
laws of the jurisdiction in which they are incorporated, and have the requisite
corporate power and authorization to own their properties and to carry on their
business as now being conducted. Each of the Company and its Subsidiaries is
duly qualified as a foreign corporation to do business and is in good standing
in every jurisdiction in which its ownership of property or the nature of the
business conducted by it makes such qualification necessary, except to the
extent that the failure to be so qualified or be in good standing would not have
a Material Adverse Effect. As used in this Agreement, "MATERIAL ADVERSE EFFECT"
means any material adverse effect on the business, properties, assets,
operations, results of operations or condition (financial or otherwise) of the
Company and its Subsidiaries, taken as a whole, or on the transactions
contemplated hereby and the other Transaction Documents or by the agreements and
instruments to be entered into in connection herewith or therewith, or on the
authority or ability of the Company to perform its obligations under the
Transaction Documents (as defined below). The Company has no Subsidiaries except
as set forth on Schedule 3(a) of the Company Disclosure Schedule.
(b) Authorization; Enforcement; Validity. The Company has the requisite
corporate power and authority to enter into and perform its obligations under
this Agreement, the Registration Rights Agreement, the Irrevocable Transfer
Agent Instructions (as defined in Section 5), the Warrants and each of the other
agreements entered into by the parties hereto in connection with the
transactions contemplated by this Agreement (collectively, the "TRANSACTION
DOCUMENTS") and to issue the Securities in accordance with the terms hereof and
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thereof. The execution and delivery of the Transaction Documents by the Company
and the consummation by the Company of the transactions contemplated hereby and
thereby, including, without limitation, the issuance of the Common Shares and
the Warrants and the reservation for issuance and the issuance of the Warrant
Shares issuable upon exercise of the Warrant have been duly authorized by the
Company's Board of Directors and no further consent or authorization is required
by the Company, its Board of Directors or its stockholders. This Agreement and
the other Transaction Documents have been duly executed and delivered by the
Company, and constitute the legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with their respective terms,
except as such enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or affecting generally, the enforcement of applicable
creditors' rights and remedies.
(c) Issuance of Securities. The Common Shares and the Warrants are duly
authorized and, upon issuance in accordance with the terms hereof, shall be
validly issued and free from all taxes, liens and charges with respect to the
issue thereof and the Common Shares shall be fully paid and nonassessable with
the holders being entitled to all rights accorded to a holder of Common Stock.
As of the Closing Date, the Company shall have duly authorized and reserved for
issuance a number of shares of Common Stock which equals the number of Warrant
Shares. The Company shall, so long as any of the Warrants are outstanding, take
all action necessary to reserve and keep available out of its authorized and
unissued Common Stock, solely for the purpose of effecting the exercise of the
Warrants, 100% of the number of shares of Common Stock issuable upon exercise of
the Warrants. Upon exercise in accordance with the Warrants, the Warrant Shares
will be validly issued, fully paid and nonassessable and free from all taxes,
liens and charges with respect to the issue thereof, with the holders being
entitled to all rights accorded to a holder of Common Stock. Assuming the
accuracy of the representations provided by the Buyers herein, the issuance by
the Company of the Securities will be exempt from registration under the 1933
Act.
(d) No Conflicts. The execution, delivery and performance of the
Transaction Documents by the Company and the consummation by the Company of the
transactions contemplated hereby and thereby (including, without limitation, the
issuance of the Common Shares and Warrants and reservation for issuance and
issuance of the Warrant Shares) will not (i) result in a violation of the
Articles of Incorporation (as defined below) or Bylaws (as defined below) of the
Company or any of its Subsidiaries or (ii) conflict with, or constitute a
default (or an event which with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, any material agreement, indenture or instrument
to which the Company or any of its Subsidiaries is a party, or (iii) result in a
violation of any law, rule, regulation, order, judgment or decree (including
federal and state securities laws and regulations and the rules and regulations
of the Principal Market) applicable to the Company or any of its Subsidiaries or
by which any property or asset of the Company or any of its Subsidiaries is
bound or affected.
(e) Consents. The Company is not required to obtain any consent,
authorization or order of, or make any filing or registration with, any court,
governmental agency or any regulatory or self-regulatory agency or any other
Person in order for it to execute, deliver or perform any of its obligations
under or contemplated by the Transaction Documents, in each case in accordance
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with the terms hereof or thereof. All consents, authorizations, orders, filings
and registrations which the Company is required to obtain pursuant to the
preceding sentence have been obtained or effected on or prior to the Closing
Date. The Company and its Subsidiaries are unaware of any facts or circumstances
that might prevent the Company from obtaining or effecting any of the
registration, application or filings pursuant to the preceding sentence. The
Company is not in violation of the listing requirements of the Principal Market
and has no knowledge of any facts that would reasonably lead to delisting or
suspension of the Common Stock in the foreseeable future.
(f) Acknowledgment Regarding Buyer's Purchase of Securities. The Company
acknowledges and agrees that each Buyer is acting solely in the capacity of
arm's length purchaser with respect to the Transaction Documents and the
transactions contemplated hereby and thereby and that no Buyer is (i) an officer
or director of the Company or (ii) to the knowledge of the Company, a
"beneficial owner" of more than 10% of the Common Stock (as defined for purposes
of Rule 13d-3 of the 1934 Act). The Company further acknowledges that no Buyer
is acting as a financial advisor or fiduciary of the Company (or in any similar
capacity) with respect to the Transaction Documents and the transactions
contemplated hereby and thereby, and any advice given by a Buyer or any of its
representatives or agents in connection with the Transaction Documents and the
transactions contemplated hereby and thereby is merely incidental to such
Buyer's purchase of the Securities. The Company further represents to each Buyer
that the Company's decision to enter into the Transaction Documents has been
based solely on the independent evaluation by the Company and its
representatives.
(g) No General Solicitation; Placement Agent's Fees. Neither the Company,
nor any of its affiliates, nor any Person acting on its or their behalf, has
engaged in any form of general solicitation or general advertising (within the
meaning of Regulation D) in connection with the offer or sale of the Securities.
The Company shall be responsible for the payment of any placement agent's fees,
financial advisory fees, or brokers' commissions (other than for persons engaged
by any Buyer or its investment advisors or agents) relating to or arising out of
the transactions contemplated hereby. The Company shall pay, and hold each Buyer
harmless against, any liability, loss or expense (including, without limitation,
attorney's fees and out-of-pocket expenses) arising in connection with any such
claim.
(h) Application of Takeover Protections; Rights Agreement. The Company and
its board of directors have taken all necessary action, if any, in order to
render inapplicable any control share acquisition, business combination, poison
pill (including any distribution under a rights agreement) or other similar
anti-takeover provision under the Articles of Incorporation or the laws of the
State of Colorado which is or could become applicable to any Buyer as a result
of the transactions contemplated by this Agreement, including, without
limitation, the Company's issuance of the Securities and any Buyer's ownership
of the Securities.
(i) SEC Documents; Financial Statements. During the two years prior to the
date hereof, the Company has timely filed all reports, schedules, forms,
statements and other documents required to be filed by it with the SEC pursuant
to the reporting requirements of the 1934 Act (all of the foregoing filed prior
to the date hereof or prior to the date of the Closing, and all exhibits
included therein and financial statements and schedules thereto and documents
incorporated by reference therein being hereinafter referred to as the "SEC
DOCUMENTS"). The Company has delivered or made available to the Buyers or their
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respective representatives true, correct and complete copies of the SEC
Documents not available on the XXXXX system. Except as may have been corrected
or supplemented in a subsequent SEC Document, the SEC Documents complied in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the SEC promulgated thereunder applicable to the SEC Documents,
and none of the SEC Documents, at the time they were filed with the SEC,
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 the light of the circumstances under which they were made, not
misleading. Except as may have been corrected or supplemented in a subsequent
SEC Document, the financial statements of the Company included in the SEC
Documents complied as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC with
respect thereto. Such financial statements have been prepared in accordance with
generally accepted accounting principles, consistently applied, during the
periods involved (except (i) as may be otherwise indicated in such financial
statements or the notes thereto, or (ii) in the case of unaudited interim
statements, to the extent they may exclude footnotes or may be condensed or
summary statements) and fairly present in all material respects the financial
position of the Company as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments). To the Company's
knowledge, no other information provided by or on behalf of the Company to the
Buyers which is not included in the SEC Documents, including, without
limitation, information referred to in Section 2(d) of this Agreement, contains
any untrue statement of a material fact or omits to state any material fact
necessary in order to make the statements therein, in the light of the
circumstance under which they are or were made, not misleading.
(j) Absence of Certain Changes. Since June 30, 2005, there has been no
Material Adverse Effect. Since June 30, 2005, the Company has not (i) declared
or paid any dividends, (ii) sold any assets, individually or in the aggregate,
in excess of $100,000 outside of the ordinary course of business or (iii) had
capital expenditures outside of the ordinary course of business, individually or
in the aggregate, in excess of $100,000. The Company has not taken any steps to
seek protection pursuant to any bankruptcy law nor does the Company have any
knowledge or reason to believe that its creditors intend to initiate involuntary
bankruptcy proceedings or any actual knowledge of any fact which would
reasonably lead a creditor to do so. The Company is not as of the date hereof,
and after giving effect to the transactions contemplated hereby to occur at the
Closing, will not be Insolvent (as defined below). For purposes of this Section
3(j), "INSOLVENT" means (i) the present fair saleable value of the Company's
assets is less than the amount required to pay the Company's total Indebtedness
(as defined in Section 3(q)), (ii) the Company is unable to pay its debts and
liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured, (iii) the Company intends to incur or
believes that it will incur debts that would be beyond its ability to pay as
such debts mature or (iv) the Company has unreasonably small capital with which
to conduct the business in which it is engaged as such business is now conducted
or is about to be conducted.
(k) No Undisclosed Events, Liabilities, Developments or Circumstances. No
event, liability, development or circumstance has occurred or exists, or is
contemplated to occur, with respect to the Company or its Subsidiaries or their
respective business, properties, operations or financial condition, that would
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be required to be disclosed by the Company under applicable securities laws on a
registration statement on Form S-1 filed with the SEC relating to an issuance
and sale by the Company of its Common Stock and which has not been publicly
announced.
(l) Conduct of Business; Regulatory Permits. Neither the Company nor any
Subsidiary is in violation of any judgment, decree or order or any statute,
ordinance, rule or regulation applicable to the Company or its Subsidiaries, and
neither the Company nor any of its Subsidiaries will conduct its business in
violation of any of the foregoing, except for possible violations which would
not, individually or in the aggregate, have a Material Adverse Effect. Without
limiting the generality of the foregoing, the Company is not in violation of any
of the rules, regulations or requirements of the Principal Market and has no
knowledge of any facts or circumstances that would reasonably lead to delisting
or suspension of the Common Stock by the Principal Market in the foreseeable
future. Since June 30, 2005, (i) the Common Stock has been designated for
quotation or listed on the Principal Market, (ii) trading in the Common Stock
has not been suspended by the SEC or the Principal Market and (iii) the Company
has received no communication, written or oral, from the SEC or the Principal
Market regarding the suspension or delisting of the Common Stock from the
Principal Market. The Company and its Subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or foreign
regulatory authorities necessary to conduct their respective businesses, except
where the failure to possess such certificates, authorizations or permits would
not have, individually or in the aggregate, a Material Adverse Effect, and
neither the Company nor any such Subsidiary has received any notice of
proceedings relating to the revocation or modification of any such certificate,
authorization or permit.
(m) Foreign Corrupt Practices. Neither the Company, nor any of its
Subsidiaries, nor, to its knowledge, any director, officer, agent, employee or
other Person acting on behalf of the Company or any of its Subsidiaries has, in
the course of its actions for, or on behalf of, the Company (i) used any
corporate funds for any unlawful contribution, gift, entertainment or other
unlawful expenses relating to political activity; (ii) made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee from corporate funds; (iii) violated or is in violation of any
provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (iv)
made any unlawful bribe, rebate, payoff, influence payment, kickback or other
unlawful payment to any foreign or domestic government official or employee.
(n) Xxxxxxxx-Xxxxx Act. The Company is in compliance with any and all
applicable requirements of the Xxxxxxxx-Xxxxx Act of 2002 that are effective as
of the date hereof, and any and all applicable rules and regulations promulgated
by the SEC thereunder that are effective as of the date hereof, except where
such noncompliance would not have, individually or in the aggregate, a Material
Adverse Effect.
(o) Transactions With Affiliates. None of the officers, directors or
employees of the Company is presently a party to any transaction with the
Company or any of its Subsidiaries (other than for ordinary course services as
employees, officers or directors), including any contract, agreement or other
arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property to or from, or otherwise requiring payments
W02-SD:8SL1\51397971.3 -9-
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to or from any such officer, director or employee or, to the knowledge of the
Company, any corporation, partnership, trust or other entity in which any such
officer, director, or employee has a substantial interest or is an officer,
director, trustee or partner.
(p) Equity Capitalization. As of the date hereof, the authorized capital
stock of the Company consists of (x) 50,000,000 shares of Common Stock, of which
as of the date hereof, approximately 22,320,000 shares are issued and
outstanding, approximately 3,700,000 shares are reserved for issuance pursuant
to the Company's employee incentive plan and other options and warrants
outstanding and less than 1,000,000 shares are reserved for issuance pursuant to
securities (other than the Warrants) exercisable or exchangeable for, or
convertible into, shares of Common Stock, and (y) 10,000,000 shares of
convertible preferred stock, of which as of the date hereof, 248,460 shares of
preferred stock are issued and outstanding. All of such outstanding shares have
been, or upon issuance will be, validly issued and are fully paid and
nonassessable. Except as set forth above in this Section 3(p) or on Schedule
3(p) of the Company Disclosure Schedule: (i) no shares of the Company's capital
stock are subject to preemptive rights or any other similar rights or any liens
or encumbrances suffered or permitted by the Company; (ii) there are no
outstanding options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, or exercisable or exchangeable for, any shares of capital
stock of the Company or any of its Subsidiaries, or contracts, commitments,
understandings or arrangements by which the Company or any of its Subsidiaries
is or may become bound to issue additional shares of capital stock of the
Company or any of its Subsidiaries or options, warrants, scrip, rights to
subscribe to, calls or commitments of any character whatsoever relating to, or
securities or rights convertible into, or exercisable or exchangeable for, any
shares of capital stock of the Company or any of its Subsidiaries; (iii) there
are no outstanding debt securities, notes, credit agreements, credit facilities
or other agreements, documents or instruments evidencing Indebtedness (as
defined in Section 3(q)) of the Company or any of its Subsidiaries or by which
the Company or any of its Subsidiaries is or may become bound; (iv) there are no
financing statements securing obligations in any material amounts, either singly
or in the aggregate, filed in connection with the Company; (v) there are no
agreements or arrangements under which the Company or any of its Subsidiaries is
obligated to register the sale of any of their securities under the 1933 Act
(except the Registration Rights Agreement); (vi) there are no outstanding
securities or instruments of the Company or any of its Subsidiaries which
contain any redemption or similar provisions, and there are no contracts,
commitments, understandings or arrangements by which the Company or any of its
Subsidiaries is or may become bound to redeem a security of the Company or any
of its Subsidiaries; (vii) there are no securities or instruments containing
anti-dilution or similar provisions that will be triggered by the issuance of
the Securities; (viii) the Company does not have any stock appreciation rights
or "phantom stock" plans or agreements or any similar plan or agreement; and
(ix) the Company and its Subsidiaries have no liabilities or obligations
required to be disclosed in the SEC Documents (as defined herein) but not so
disclosed in the SEC Documents, other than those incurred in the ordinary course
of the Company's or any Subsidiary's respective businesses and which,
individually or in the aggregate, do not or would not have a Material Adverse
Effect. The Company has furnished or made available to the Buyer upon such
Buyer's request, true, correct and complete copies of the Company's Articles of
Incorporation, as amended and as in effect on the date hereof (the "ARTICLES OF
INCORPORATION"), and the Company's Bylaws, as amended and as in effect on the
date hereof (the "BYLAWS"), and the terms of all securities convertible into, or
W02-SD:8SL1\51397971.3 -10-
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exercisable or exchangeable for, Common Stock and the material rights of the
holders thereof in respect thereto.
(q) Indebtedness and Other Contracts. Except as disclosed in the SEC
Documents or Schedule 3(r) of the Company Disclosure Schedule, neither the
Company nor any of its Subsidiaries (i) has any outstanding Indebtedness (as
defined below), (ii) is in violation of any term of or in default under any
contract, agreement or instrument relating to any Indebtedness, except where
such violations and defaults would not result, individually or in the aggregate,
in a Material Adverse Effect, or (iii) is a party to any contract, agreement or
instrument relating to any Indebtedness, the performance of which, in the
judgment of the Company's officers, has or is expected to have a Material
Adverse Effect. For purposes of this Agreement: (x) "INDEBTEDNESS" of any Person
means, without duplication (A) all indebtedness for borrowed money, (B) all
obligations issued, undertaken or assumed as the deferred purchase price of
property or services (other than trade payables entered into in the ordinary
course of business), (C) all reimbursement or payment obligations with respect
to letters of credit, surety bonds and other similar instruments, (D) all
obligations evidenced by notes, bonds, debentures or similar instruments,
including obligations so evidenced incurred in connection with the acquisition
of property, assets or businesses, (E) all indebtedness created or arising under
any conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to any property or assets acquired with
the proceeds of such indebtedness (even though the rights and remedies of the
seller or bank under such agreement in the event of default are limited to
repossession or sale of such property), (F) all monetary obligations under any
leasing or similar arrangement which, in connection with generally accepted
accounting principles, consistently applied for the periods covered thereby, is
classified as a capital lease, (G) all indebtedness referred to in clauses (A)
through (F) above secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any mortgage,
lien, pledge, charge, security interest or other encumbrance upon or in any
property or assets (including accounts and contract rights) owned by any Person,
even though the Person which owns such assets or property has not assumed or
become liable for the payment of such indebtedness. "PERSON" means an
individual, a limited liability company, a partnership, a joint venture, a
corporation, a trust, an unincorporated organization and a government or any
department or agency thereof.
(r) Absence of Litigation. Except as set forth in the SEC Documents or on
Schedule 3(s) of the Company Disclosure Schedule, there is no action, suit,
proceeding, inquiry or investigation before or by the Principal Market, any
court, public board, government agency, self-regulatory organization or body
pending or, to the knowledge of the Company, threatened against or affecting the
Company, the Common Stock or any of its Subsidiaries or any of the Company's or
the Company's Subsidiary's officers or directors, whether of a civil or criminal
nature or otherwise.
(s) Insurance. The Company and each of its Subsidiaries are insured against
such losses and risks, in such amounts and by such insurers as management of the
Company believes to be prudent and customary in the businesses in which the
Company and its Subsidiaries are engaged.
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(t) Employee Relations. Neither the Company nor any of its Subsidiaries is
a party to any collective bargaining agreement or employs any member of a union.
The Company and its Subsidiaries believe that their relations with their
employees are good. No executive officer of the Company (as defined in Rule
501(f) of the 0000 Xxx) has notified the Company that such officer intends to
leave the Company or otherwise terminate such officer's employment with the
Company. No executive officer of the Company, to the knowledge of the Company,
is, or is now expected to be, in violation of any material term of any
employment contract, confidentiality, disclosure or proprietary information
agreement, non-competition agreement, or any other contract or agreement or any
restrictive covenant, and the continued employment of each such executive
officer does not subject the Company or any of its Subsidiaries to any liability
with respect to any of the foregoing matters.
(i) The Company and its Subsidiaries are in compliance with all
federal, state, local and foreign laws and regulations respecting
employment and employment practices, terms and conditions of employment and
wages and hours, except where failure to be in compliance would not, either
individually or in the aggregate, reasonably be expected to result in a
Material Adverse Effect.
(u) Title. The Company and its Subsidiaries have good and marketable
title in fee simple to all real property and good and marketable title to all
personal property owned by them which is material to the business of the Company
and its Subsidiaries, in each case free and clear of all liens, encumbrances and
defects except such as do not interfere with the use made and proposed to be
made of such property by the Company and any of its Subsidiaries. Any real
property and facilities held under lease by the Company and any of its
Subsidiaries are held by them under valid, subsisting and enforceable leases
with such exceptions as are not material and do not interfere with the use made
and proposed to be made of such property and buildings by the Company and its
Subsidiaries.
(v) Intellectual Property Rights. The Company and its Subsidiaries own or
possess adequate rights or licenses to use all trademarks, trade names, service
marks, service xxxx registrations, service names, patents, patent rights,
copyrights, inventions, licenses, approvals, governmental authorizations, trade
secrets and other intellectual property rights ("INTELLECTUAL PROPERTY RIGHTS")
necessary to conduct their respective businesses as now conducted and which the
failure to so own or possess could, individually or in the aggregate, have or
reasonably be expected to result in a Material Adverse Effect. The Company does
not have any knowledge of any infringement by the Company or its Subsidiaries of
Intellectual Property Rights of others. There is no claim, action or proceeding
being made or brought, or to the knowledge of the Company, being threatened,
against the Company or any of its Subsidiaries regarding its Intellectual
Property Rights. The Company is unaware of any facts which might give rise to
any of the foregoing infringements or claims, actions or proceedings. The
Company and its Subsidiaries have taken reasonable security measures to protect
the secrecy, confidentiality and value of all of their Intellectual Property
Rights.
(w) Environmental Laws. To the Company's knowledge, the Company and its
Subsidiaries (i) are in compliance with any and all Environmental Laws (as
hereinafter defined), (ii) have received all permits, licenses or other
approvals required of them under applicable Environmental Laws to conduct their
W02-SD:8SL1\51397971.3 -12-
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respective businesses and (iii) are in compliance with all terms and conditions
of any such permit, license or approval where, in each of the foregoing clauses
(i), (ii) and (iii), the failure to so comply could be reasonably expected to
have, individually or in the aggregate, a Material Adverse Effect. The term
"ENVIRONMENTAL LAWS" means all federal, state, local or foreign laws relating to
pollution or protection of human health or the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or subsurface
strata), including, without limitation, laws relating to emissions, discharges,
releases or threatened releases of chemicals, pollutants, contaminants, or toxic
or hazardous substances or wastes (collectively, "HAZARDOUS MATERIALS") into the
environment, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous Materials,
as well as all authorizations, codes, decrees, demands or demand letters,
injunctions, judgments, licenses, notices or notice letters, orders, permits,
plans or regulations issued, entered, promulgated or approved thereunder.
(x) Tax Status. The Company and each of its Subsidiaries (i) has made or
filed all federal and state income and all other material tax returns, reports
and declarations required by any jurisdiction to which it is subject, (ii) has
paid all taxes and other governmental assessments and charges that are material
in amount, shown or determined to be due on such returns, reports and
declarations, except those being contested in good faith and (iii) has set aside
on its books provision reasonably adequate for the payment of all taxes for
periods subsequent to the periods to which such returns, reports or declarations
apply. There are no unpaid taxes in any material amount claimed to be due by the
taxing authority of any jurisdiction, and the officers of the Company know of no
basis for any such claim.
(y) Internal Accounting and Disclosure Controls. The Company and each of
its Subsidiaries maintain a system of internal accounting control sufficient to
provide reasonable assurance that (i) transactions are executed in accordance
with management's general or specific authorizations, (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain asset
and liability accountability, (iii) access to assets or incurrence of
liabilities is permitted only in accordance with management's general or
specific authorization and (iv) the recorded accountability for assets and
liabilities is compared with the existing assets and liabilities at reasonable
intervals and appropriate action is taken with respect to any difference. The
Company maintains disclosure controls and procedures (as such term is defined in
Rule 13a-14 under the 0000 Xxx) that are effective in ensuring that information
required to be disclosed by the Company in the reports that it files or submits
under the 1934 Act is recorded, processed, summarized and reported, within the
time periods specified in the rules and forms of the SEC, including, without
limitation, controls and procedures designed in to ensure that information
required to be disclosed by the Company in the reports that it files or submits
under the 1934 Act is accumulated and communicated to the Company's management,
including its principal executive officer or officers and its principal
financial officer or officers, as appropriate, to allow timely decisions
regarding required disclosure.
(z) Form SB-2 Eligibility. The Company is eligible to register the Common
Shares and the Warrant Shares for resale by the Buyers using Form SB-2
promulgated under the 1933 Act.
W02-SD:8SL1\51397971.3 -13-
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(aa) Off Balance Sheet Arrangements. There is no transaction,
arrangement, or other relationship between the Company and an
unconsolidated or other off balance sheet entity that is required to be
disclosed by the Company in its Exchange Act filings and is not so
disclosed or that otherwise would be reasonably likely to have a Material
Adverse Effect.
(bb) Manipulation of Price. The Company has not, and to its knowledge
no one acting on its behalf has taken, directly or indirectly, any action
designed to cause or to result in the stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of
any of the Securities in violation of Section 9(a)(2) of the Securities
Exchange Act of 1934 (or defined term).
(cc) Transfer Taxes. On the Closing Date, all stock transfer or other
taxes (other than income or similar taxes) which are required to be paid in
connection with the sale and transfer of the Securities to be sold to each
Buyer hereunder will be, or will have been, fully paid or provided for by
the Company, and all laws imposing such taxes will be or will have been
complied with.
(dd) Disclosure. The Company understands and confirms that each of the
Buyers will rely on the foregoing representations in effecting transactions
in securities of the Company. None of the SEC Documents, the Transaction
Documents or the Company Disclosure Schedules to this Agreement contain any
untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in the light of the
circumstances under which they were made, not misleading. No event or
circumstance has occurred or information exists with respect to the Company
or any Subsidiary or either of its or their respective business,
properties, prospects, operations or financial conditions, which, under
applicable law, rule or regulation, requires public disclosure or
announcement by the Company but which has not been so publicly announced or
disclosed (assuming for this purpose that the Company's reports filed under
the Exchange Act of 1934, as amended, are being incorporated into an
effective registration statement filed by the Company under the 1933 Act).
The Company acknowledges and agrees that no Buyer makes or has made any
representations or warranties with respect to the transactions contemplated
hereby other than those specifically set forth in Section 2.
4. COVENANTS
(a) Best Efforts. Each party shall use its best efforts timely to satisfy
each of the covenants and the conditions to be satisfied by it as provided in
Sections 5, 6 and 7 of this Agreement.
(b) Form D and Blue Sky. The Company agrees to file a Form D with respect
to the Securities as required under Regulation D and to provide a copy thereof
to each Buyer promptly after such filing. The Company, on or before the Closing
Date, shall take such action as the Company shall reasonably determine is
necessary in order to obtain an exemption for or to qualify the Securities for
sale to the Buyers at the Closing pursuant to this Agreement under applicable
securities or "Blue Sky" laws of the states of the United States (or to obtain
an exemption from such qualification), and shall provide evidence of any such
action so taken to the Buyers on or prior to the Closing Date. The Company shall
W02-SD:8SL1\51397971.3 -14-
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make all filings and reports relating to the offer and sale of the Securities
required under applicable securities or "Blue Sky" laws of the states of the
United States following the Closing Date.
(c) Reporting Status. Until the date on which the Investors (as defined in
the Registration Rights Agreement) shall have sold all the Common Shares and
Warrant Shares and none of the Warrants is outstanding (the "REPORTING PERIOD"),
the Company shall use its best efforts to timely file all reports required to be
filed with the SEC pursuant to the 1934 Act, and the Company shall not terminate
its status as an issuer required to file reports under the 1934 Act even if the
1934 Act or the rules and regulations thereunder would otherwise permit such
termination.
(d) Use of Proceeds. The Company will use the proceeds from the sale of the
Securities for general corporate purposes, including general and administrative
expenses and not for (i) the repayment of any outstanding Indebtedness of the
Company or any of its Subsidiaries (except for indebtedness of Starsys Research
Corporation in accordance with the Company's objectives under the Agreement and
Plan of Merger and Reorganization dated October 24, 2005) or (ii) redemption or
repurchase of any of its equity securities.
(e) Financial Information. The Company agrees to send the following to each
Investor during the Reporting Period, unless the following are filed with the
SEC through XXXXX and are available to the public through the XXXXX system,
within one (1) Business Day after the filing thereof with the SEC, a copy of its
Annual Reports on Form 10-KSB, its Quarterly Reports on Form 10-QSB, any Current
Reports on Form 8-K, any registration statements (other than on Form S-8) or
amendments filed pursuant to the 1933 Act and copies of any notices and other
information made available or given to the stockholders of the Company
generally, contemporaneously with the making available or giving thereof to the
stockholders. As used herein, "BUSINESS DAY" means any day other than Saturday,
Sunday or other day on which commercial banks in The City of New York are
authorized or required by law to remain closed.
(f) Listing and Quoting. The Company shall promptly secure the listing or
quoting of all of the Registrable Securities (as defined in the Registration
Rights Agreement) upon each national securities exchange and automated quotation
system, if any, upon which shares of Common Stock are then listed or quoted
(subject to official notice of issuance) and shall maintain, so long as any
other shares of Common Stock shall be so listed or quoted, such listing or
quoting of all Registrable Securities from time to time issuable under the terms
of the Transaction Documents. The Company shall use its best efforts to maintain
the Common Stock's authorization for listing or quoting on the Principal Market.
Neither the Company nor any of its Subsidiaries shall take any action which
would be reasonably expected to result in the delisting or suspension of the
Common Stock on the Principal Market. The Company shall pay all fees and
expenses in connection with satisfying its obligations under this Section 4(f).
(g) Fees. Subject to Section 8 below, at the Closing and subject to
providing supporting documentation, the Company shall reimburse up to $87,500 of
the reasonable fees and expenses in connection with the preparation, execution
and performance of this Agreement and the transactions contemplated hereunder,
which amount shall be withheld by such Buyer from its Purchase Price at the
Closing. The Company shall be responsible for the payment of any placement
W02-SD:8SL1\51397971.3 -15-
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agent's fees, financial advisory fees, or broker's commissions (other than for
Persons engaged, directly or indirectly, by any Buyer) relating to or arising
out of the transactions contemplated hereby, including, without limitation, any
fees or commissions payable to Xxxxxxxxxx & Co. and/or Laurus Master Fund, Ltd.,
a Cayman Islands company and a Buyer ("LAURUS") (individually or together, the
"AGENT"). The Company shall pay, and hold each Buyer harmless against, any
liability, loss or expense (including, without limitation, reasonable attorney's
fees and out-of-pocket expenses) arising in connection with any claim relating
to any such payment. Except as otherwise set forth in the Transaction Documents,
each party to this Agreement shall bear its own expenses in connection with the
sale of the Securities to the Buyers.
(h) Pledge of Securities. The Company acknowledges and agrees that the
Securities may be pledged by an Investor (as defined in the Registration Rights
Agreement) in connection with a bona fide margin agreement that is secured by
the Securities. Such pledge of Securities shall not be deemed to be a transfer,
sale or assignment of the Securities hereunder, and no Investor effecting such a
pledge of Securities shall be required to provide the Company with any notice
thereof or otherwise make any delivery to the Company pursuant to this Agreement
or any other Transaction Document, including, without limitation, Section 2(f)
of this Agreement; provided that an Investor and its pledgee shall be required
to comply with the provisions of Section 2(f) of this Agreement in order to
effect a sale, transfer or assignment of Securities to such pledgee. The Company
hereby agrees to execute and deliver such documentation as a pledgee of the
Securities may reasonably request in connection with such a pledge of the
Securities to such pledgee by an Investor.
(i) Disclosure of Transactions and Other Material Information. The Company
shall, on or before 8:30 a.m., New York City Time, within four (4) Business Days
after the date of this Agreement, issue a press release (the "PRESS RELEASE")
disclosing all material terms of the transactions contemplated hereby. Such
press release shall be subject to the consent (written or oral) of the Buyers,
which consent will not be unreasonably withheld or delayed (and will be given or
denied within twenty four hours of receipt of a draft thereof). On or before
8:30 a.m., New York City Time, on the fourth Business Day following the Closing
Date, the Company shall file a Current Report on Form 8-K describing the terms
of the transactions contemplated by the Transaction Documents in the form
required by the 1934 Act, and attaching the material Transaction Documents
(including, without limitation, this Agreement (and all schedules to this
Agreement), the form of Warrant and the Registration Rights Agreement) as
exhibits to such filing (including all attachments, the "8-K FILING"). From and
after the issuance of the Press Release, no Buyer shall be in possession of any
material, nonpublic information received from the Company, any of its
Subsidiaries or any of its respective officers, directors, employees or agents,
that is not disclosed in the Press Release.
(j) Reservation of Shares. The Company shall take all action necessary to
at all times have authorized, and reserved for the purpose of issuance, from and
after the Closing Date, the number of shares of Common Stock issuable upon
exercise of the Warrants being issued at the Closing in conformity with Section
3(c).
(k) Restrictions. So long as a Buyer continues to hold any Securities
acquired hereunder, such Buyer will not, nor will it knowingly through its
affiliates engage in any Short Sale, except on those days (each a "Permitted
W02-SD:8SL1\51397971.3 -16-
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Day") on which the aggregate short position with respect to the Common Stock of
such Buyer prior to giving effect to any Short Sales by such Buyer on such
Permitted Day does not exceed such Buyer's Permitted Share Position (as defined
below) on such Permitted Day; provided, however, that a Buyer will only be
entitled to engage in transactions that constitute Short Sales on a Permitted
Day to the extent that following such transaction, the aggregate short position
with respect to the Common Stock of such Buyer does not exceed such Buyer's
Permitted Share Position. For purposes of this Section 4(k) a Buyer's "Permitted
Share Position" means, with respect to any date of determination, the number of
shares of Common Stock owned by such Buyer (including Common Shares) plus the
maximum number of Warrant Shares then issuable (including as to portions of
Warrants not yet exercised and without regard to any exercise caps or other
exercise restrictions applicable to the Warrants) to such Buyer.
(l) Other Transactions Permitted. Subject to Section 4(k) and applicable
securities laws, the Company acknowledges and agrees that nothing in this
Section 4(l) or elsewhere in any Transaction Document prohibits any Buyer from,
and each Buyer is permitted to, engage, directly or indirectly, in hedging
transactions involving the Securities and the Common Stock (including, without
limitation, by way of short sales, purchases and sales of options, swap
transactions and synthetic transactions) at any time.
(m) Waiver of Certain Rights. Laurus has certain rights including a right
of first refusal on certain sales and issuances of equity securities by the
Company pursuant to Section 6.16 of that certain Securities Purchase Agreement
dated August 25, 2004 between Laurus and the Company (the "SERIES C AGREEMENT").
In consideration of its participation as a Buyer pursuant to this Agreement,
Laurus hereby waives any and all rights it may have pursuant to the Series C
Agreement and the Related Agreements (as defined therein) with respect to the
transactions contemplated hereby. Furthermore, Laurus agrees that the issuance
of the Securities shall not reset or have any other affect on the Fixed
Conversion Price (as such term is defined in the Certificate of Designations (as
defined in the Series C Agreement)) of the Series C Cumulative Convertible
Preferred Stock pursuant to Section 6(b) of the Certificate of Designations.
5. TRANSFER RESTRICTIONS; TRANSFER AGENT INSTRUCTIONS.
(a) Transfer Restrictions. The legend set forth in Section 2(g) shall be
removed and the Company shall issue a certificate without such legend or any
other legend to the holder of the applicable Securities upon which it is
stamped, if (i) such Securities are at such time registered for resale under the
1933 Act, or (ii) in connection with a sale, assignment or other transfer, such
holder provides the Company with an opinion of counsel, in a generally
acceptable form, to the effect that such sale, assignment or transfer of such
Securities may be made without registration under the applicable requirements of
the 1933 Act. The Company shall cause General Counsel (as defined below) to
issue the legal opinion included in the Irrevocable Transfer Agent Instructions
to the Company's transfer agent on the date (the "EFFECTIVE DATE") the SEC
declares effective the registration statement registering the Common Shares and
the Warrant Shares for resale (the "REGISTRATION STATEMENT"). Following the
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Effective Date or at such earlier time as a legend is no longer required for
certain Securities, the Company will no later than three Business Days following
the delivery by a Buyer to the Company or the Company's transfer agent of a
legended certificate representing such Securities, deliver or cause to be
delivered to such Buyer a certificate representing such Securities that is free
from all restrictive and other legends. Following the Effective Date and upon
the delivery to any Buyer of any certificate representing Securities that is
free from all restrictive and other legends, such Buyer agrees that any sale of
such Securities shall be made pursuant to the Registration Statement and in
accordance with the plan of distribution described therein or pursuant to an
available exemption from the registration requirements of the 0000 Xxx. The
Company may not make any notation on its records or give instructions to any
transfer agent of the Company that enlarge the restrictions on transfer set
forth in Section 2(f). The Company will not effect or publicly announce its
intention to effect any exchange, recapitalization or other transaction that
effectively requires or rewards physical delivery of certificates evidencing the
Common Stock.
(b) Transfer Agent Instructions. The Company shall issue irrevocable
instructions to its transfer agent, and any subsequent transfer agent, to issue
certificates or credit shares to the applicable balance accounts at The
Depository Trust Company ("DTC"), registered in the name of each Buyer or its
respective nominee(s), for the Warrant Shares in such amounts as specified from
time to time by each Buyer to the Company upon exercise of the Warrants in the
form of Exhibit C attached hereto, or other form acceptable to such transfer
agent (the "IRREVOCABLE TRANSFER AGENT INSTRUCTIONS"). The Company represents
and warrants that no instruction contrary to the Irrevocable Transfer Agent
Instructions referred to in this Section 5, except for stop transfer
instructions to give effect to Section 2(f) hereof, will be given by the Company
to its transfer agent with respect to the Securities, and that the Securities
shall otherwise be freely transferable on the books and records of the Company
as and to the extent provided in this Agreement and the other Transaction
Documents.
(c) Breach. The Company acknowledges that a breach by it of its obligations
hereunder will cause irreparable harm to a Buyer. Accordingly, the Company
acknowledges that the remedy at law for a breach of its obligations under this
Section 5 will be inadequate and agrees, in the event of a breach or threatened
breach by the Company of the provisions of this Section 5, that a Buyer shall be
entitled, in addition to all other available remedies, to an order and/or
injunction restraining any breach and requiring immediate issuance and transfer,
without the necessity of showing economic loss and without any bond or other
security being required.
(d) Additional Relief. If the Company shall fail for any reason or for no
reason to issue to such holder unlegended certificates within three (3) Business
Days of receipt of documents necessary for the removal of legend set forth above
(the "DEADLINE DATE"), then, in addition to all other remedies available to the
holder, if on or after the Trading Day (as defined in Section 4(m)) immediately
following such three Business Day period, the holder purchases (in an open
market transaction or otherwise) shares of Common Stock to deliver in
satisfaction of a sale by the holder of shares of Common Stock that the holder
anticipated receiving from the Company (a "BUY-IN"), then the Company shall,
within three Business Days after the holder's request and in the holder's
discretion, either (i) pay cash to the holder in an amount equal to the holder's
total purchase price (including brokerage commissions, if any) for the shares of
Common Stock so purchased (the "BUY-IN PRICE"), at which point the Company's
obligation to deliver such certificate (and to issue such shares of Common
Stock) shall terminate, or (ii) promptly honor its obligation to deliver to the
W02-SD:8SL1\51397971.3 -18-
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holder a certificate or certificates representing such shares of Common Stock
and pay cash to the holder in an amount equal to the excess (if any) of the
Buy-In Price over the product of (A) such number of shares of Common Stock,
times (B) the Closing Bid Price on the Deadline Date. "CLOSING BID PRICE" means,
for any security as of any date, the last closing price for such security on OTC
Bulletin Board (the "PRINCIPAL MARKET"), as reported by Bloomberg, or, if the
Principal Market begins to operate on an extended hours basis and does not
designate the closing bid price then the last bid price of such security prior
to 4:00:00 p.m., New York Time, as reported by Bloomberg, or, if the Principal
Market is not the principal securities exchange or trading market for such
security, the last closing price of such security on the principal securities
exchange or trading market where such security is listed or traded as reported
by Bloomberg, or if the foregoing do not apply, the last closing price of such
security in the over-the-counter market on the electronic bulletin board for
such security as reported by Bloomberg, or, if no closing bid price is reported
for such security by Bloomberg, the average of the bid prices of any market
makers for such security as reported in the "pink sheets" by Pink Sheets LLC
(formerly the National Quotation Bureau, Inc.). If the Closing Bid Price cannot
be calculated for a security on a particular date on any of the foregoing bases,
the Closing Bid Price of such security on such date shall be the fair market
value as mutually determined by the Company and the holder. If the Company and
the holder are unable to agree upon the fair market value of such security, then
such dispute shall be resolved pursuant to Section 12 of the Warrants. All such
determinations to be appropriately adjusted for any stock dividend, stock split,
stock combination or other similar transaction during the applicable calculation
period.
6. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL.
The obligation of the Company hereunder to issue and sell the Common Shares
and the related Warrants to each Buyer at the Closing is subject to the
satisfaction, at or before the Closing Date, of each of the following
conditions, provided that these conditions are for the Company's sole benefit
and may be waived by the Company at any time in its sole discretion by providing
each Buyer with prior written notice thereof:
(i) Such Buyer shall have executed each of the Transaction Documents
to which it is a party and delivered the same to the Company.
(ii) Such Buyer shall have delivered to the Company the Purchase Price
for the Common Shares and the related Warrants being purchased by such
Buyer and each other Buyer at the Closing by wire transfer of immediately
available funds pursuant to the wire instructions provided by the Company.
(iii) The representations and warranties of such Buyer shall be true
and correct in all material respects as of the date when made and as of the
Closing Date as though made at that time (except for representations and
warranties that speak as of a specific date), and such Buyer shall have
performed, satisfied and complied in all material respects with the
covenants, agreements and conditions required by this Agreement to be
performed, satisfied or complied with by such Buyer at or prior to the
Closing Date.
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7. CONDITIONS TO EACH BUYER'S OBLIGATION TO PURCHASE.
The obligation of each Buyer hereunder to purchase the Common Shares and
the related Warrants at the Closing is subject to the satisfaction, at or before
the Closing Date, of each of the following conditions, provided that these
conditions are for each Buyer's sole benefit and may be waived by such Buyer at
any time in its sole discretion by providing the Company with prior written
notice thereof:
(i) The Company shall have executed and delivered to such Buyer (i)
each of the Transaction Documents and (ii) the Common Shares (in such
amounts as such Buyer shall request) and the related Warrants (in such
amounts as such Buyer shall request) being purchased by such Buyer at the
Closing pursuant to this Agreement.
(ii) Such Buyer shall have received the opinion of Sheppard, Mullin,
Xxxxxxx & Xxxxxxx, LLP the Company's outside counsel ("COMPANY COUNSEL"),
dated as of the Closing Date, in substantially the form of Exhibit
Dattached hereto.
(iii) The Company shall have delivered to such Buyer a copy of the
Irrevocable Transfer Agent Instructions, in the form of Exhibit C attached
hereto, which instructions shall have been delivered to and acknowledged in
writing by the Company's transfer agent.
(iv) The Company shall have delivered to such Buyer a certificate
evidencing the incorporation and good standing of the Company in the
Company's state of incorporation issued by the Secretary of State of such
state of incorporation as of a date within 10 days of the Closing Date.
(v) The Common Stock (I) shall be listed on the Principal Market and
(II) shall not have been suspended, as of the Closing Date, by the SEC or
the Principal Market from trading on the Principal Market nor shall
suspension by the SEC or the Principal Market have been threatened, as of
the Closing Date, either (A) in writing by the SEC or the Principal Market
or (B) by falling below the minimum listing maintenance requirements of the
Principal Market.
(vi) The Company shall have delivered to such Buyer a certified copy
of the Articles of Incorporation as certified by the Secretary of State of
the State of Colorado within 20 days of the Closing Date.
(vii) The Company shall have delivered to such Buyer a certificate,
executed by the Secretary of the Company and dated as of the Closing Date,
as to (i) the resolutions consistent with Section 3(b) as adopted by the
Company's Board of Directors in a form reasonably acceptable to such Buyer,
(ii) the Articles of Incorporation and (iii) the Bylaws, each as in effect
at the Closing, in the form attached hereto as Exhibit E.
(viii) The representations and warranties of the Company shall be true
and correct as of the date when made and as of the Closing Date as though
made at that time (except for representations and warranties that speak as
of a specific date) and the Company shall have performed, satisfied and
complied in all respects with the covenants, agreements and conditions
W02-SD:8SL1\51397971.3 -20-
PAGE
required by the Transaction Documents to be performed, satisfied or
complied with by the Company at or prior to the Closing Date. Such Buyer
shall have received a certificate, executed by the President of the
Company, dated as of the Closing Date, to the foregoing effect and as to
such other matters as may be reasonably requested by such Buyer in the form
attached hereto as Exhibit F.
(ix) The Company shall have delivered to such Buyer a letter from the
Company's transfer agent certifying the number of shares of Common Stock
outstanding as of a date within five days of the Closing Date.
(x) The Company shall have obtained all governmental, regulatory or
third party consents and approvals, if any, necessary for the sale of the
Common Shares and the Warrants.
(xi) The Company shall have delivered to such Buyer such other
documents relating to the transactions contemplated by this Agreement as
such Buyer or its counsel may reasonably request.
8. TERMINATION. In the event that the Closing shall not have occurred with
respect to a Buyer on or before five (5) days from the date hereof due to the
Company's or such Buyer's failure to satisfy the conditions set forth in
Sections 6 and 7 above (and the nonbreaching party's failure to waive such
unsatisfied condition(s)), the nonbreaching party shall have the option to
terminate this Agreement with respect to such breaching party at the close of
business on such date without liability of any party to any other party.
9. MISCELLANEOUS.
(a) Governing Law; Jurisdiction; Jury Trial. All questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by the internal laws of the State of New York, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State
of New York or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of New York. Each party hereby
irrevocably submits to the exclusive jurisdiction of the state and federal
courts sitting in The City of New York, Borough of Manhattan for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF
THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
W02-SD:8SL1\51397971.3 -21-
PAGE
(b) Counterparts. This Agreement may be executed in two or more identical
counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to the other party; provided that a facsimile signature shall be
considered due execution and shall be binding upon the signatory thereto with
the same force and effect as if the signature were an original, not a facsimile
signature.
(c) Headings. The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Agreement.
(d) Severability. If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect the validity or enforceability of the remainder of this Agreement in that
jurisdiction or the validity or enforceability of any provision of this
Agreement in any other jurisdiction.
(e) Entire Agreement; Amendments. This Agreement supersedes all other prior
oral or written agreements between the Buyers, the Company, their affiliates and
Persons acting on their behalf with respect to the matters discussed herein, and
this Agreement and the instruments referenced herein contain the entire
understanding of the parties with respect to the matters covered herein and
therein and, except as specifically set forth herein or therein, neither the
Company nor any Buyer makes any representation, warranty, covenant or
undertaking with respect to such matters. No provision of this Agreement may be
amended other than by an instrument in writing signed by the Company and the
holders of Common Shares representing at least a majority of the amount of the
Common Shares, or, if prior to the Closing Date, the Buyers listed on the
Schedule of Buyers as being obligated to purchase at least a majority of the
amount of the Common Shares. No provision hereof may be waived other than by an
instrument in writing signed by the party against whom enforcement is sought. No
such amendment shall be effective to the extent that it applies to less than all
of the holders of the Common Shares then outstanding. No consideration shall be
offered or paid to any Person to amend or consent to a waiver or modification of
any provision of any of the Transaction Documents unless the same consideration
also is offered to all of the parties to the Transaction Documents, holders of
Common Shares or holders of the Warrants, as the case may be. The Company has
not, directly or indirectly, made any agreements with any Buyers relating to the
terms or conditions of the transactions contemplated by the Transaction
Documents except as set forth in the Transaction Documents.
(f) Notices. Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one Business Day after deposit with
an overnight courier service, in each case properly addressed to the party to
receive the same. The addresses and facsimile numbers for such communications
shall be:
If to the Company:
W02-SD:8SL1\51397971.3 -22-
PAGE
SpaceDev, Inc.
00000 Xxxxx Xxxxx
Xxxxx, XX 00000
Telephone: (000)000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx, President and Chief Financial Officer
With a copy to (which shall not constitute notice):
Sheppard, Mullin, Xxxxxxx and Hampton, LLP
00000 Xxxx Xxxxx Xxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxxxxxx, Esq.
If to the Transfer Agent:
Continental Stock Transfer & Trust Company
00 Xxxxxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxx Xxxxxxxx
If to a Buyer, to its address and facsimile number set forth on the Schedule of
Buyers, with copies to such Buyer's representatives as set forth on the Schedule
of Buyers, or to such other address and/or facsimile number and/or to the
attention of such other Person as the recipient party has specified by written
notice given to each other party five (5) days prior to the effectiveness of
such change. Written confirmation of receipt (A) given by the recipient of such
notice, consent, waiver or other communication, (B) mechanically or
electronically generated by the sender's facsimile machine containing the time,
date, recipient facsimile number and an image of the first page of such
transmission or (C) provided by an overnight courier service shall be rebuttable
evidence of personal service, receipt by facsimile or receipt from an overnight
courier service in accordance with clause (i), (ii) or (iii) above,
respectively.
(g) Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and
assigns, including any purchasers of the Common Shares or the Warrants. The
Company shall not assign this Agreement or any rights or obligations hereunder
without the prior written consent of the holders of Common Shares representing
at least a majority of the number of the Common Shares, including by merger or
consolidation. A Buyer may assign some or all of its rights hereunder to any
Person to whom such Purchaser assigns or transfers any Securities; provided that
such transfer is in accordance with this Agreement and the transferee agrees to
be bound, with respect to the transferred securities, by the provisions hereof
that apply to Buyers. Any such assignee shall be deemed to be a Buyer hereunder
with respect to such assigned rights.
W02-SD:8SL1\51397971.3 -23-
PAGE
(h) No Third Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person.
(i) Survival. Unless this Agreement is terminated under Section 8, the
representations and warranties of the Company and the Buyers contained in
Sections 2 and 3, the agreements and covenants set forth in Sections 4, 5 and 9
shall survive the Closing and the delivery and exercise of Securities, as
applicable, for a period of one year. Each Buyer shall be responsible only for
its own representations, warranties, agreements and covenants hereunder.
(j) Further Assurances. Each party shall do and perform, or cause to be
done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
any other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
(k) Indemnification. In consideration of each Buyer's execution and
delivery of the Transaction Documents and acquiring the Securities thereunder
and in addition to all of the Company's other obligations under the Transaction
Documents, the Company shall defend, protect, indemnify and hold harmless each
Buyer and each other holder of the Securities and all of their stockholders,
partners, members, officers, directors, employees and direct or indirect
investors and any of the foregoing Persons' agents or other representatives
(including, without limitation, those retained in connection with the
transactions contemplated by this Agreement) (collectively, the "INDEMNITEES")
from and against any and all actions, causes of action, suits, claims, losses,
costs, penalties, fees, liabilities and damages, and expenses in connection
therewith (irrespective of whether any such Indemnitee is a party to the action
for which indemnification hereunder is sought), and including reasonable
attorneys' fees and disbursements (the "INDEMNIFIED LIABILITIES"), incurred by
any Indemnitee as a result of, or arising out of or relating to (a) any
misrepresentation or breach of any representation or warranty made by the
Company in the Transaction Documents or any other certificate, instrument or
document contemplated hereby or thereby or (b) any breach of any covenant,
agreement or obligation of the Company contained in the Transaction Documents or
any other certificate, instrument or document contemplated hereby or thereby,
provided, however, such indemnity shall be limited to each Buyer's total
Purchase Price. To the extent that the foregoing undertaking by the Company may
be unenforceable for any reason, the Company shall make the maximum contribution
to the payment and satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law. Except as otherwise set forth herein, the
mechanics and procedures with respect to the rights and obligations under this
Section 9(k) shall be the same as those set forth in Section 6 of the
Registration Rights Agreement.
(l) No Strict Construction. The language used in this Agreement will be
deemed to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any party.
(m) Remedies. Each Buyer and each holder of the Securities shall have all
rights and remedies set forth in the Transaction Documents and all rights and
remedies which such holders have been granted at any time under any other
agreement or contract and all of the rights which such holders have under any
W02-SD:8SL1\51397971.3 -24-
PAGE
law. Any Person having any rights under any provision of this Agreement shall be
entitled to enforce such rights specifically (without posting a bond or other
security), to recover damages by reason of any breach of any provision of this
Agreement and to exercise all other rights granted by law. Furthermore, the
Company recognizes that in the event that it fails to perform, observe, or
discharge any or all of its obligations under the Transaction Documents, any
remedy at law may prove to be inadequate relief to the Buyers. The Company
therefore agrees that the Buyers shall be entitled to seek temporary and
permanent injunctive relief in any such case without the necessity of proving
actual damages and without posting a bond or other security.
(n) Rescission and Withdrawal Right. Notwithstanding anything to the
contrary contained in (and without limiting any similar provisions of) the
Transaction Documents, whenever any Buyer exercises a right, election, demand or
option under a Transaction Document and the Company does not timely perform its
related obligations within the periods therein provided, then such Buyer may
rescind or withdraw, in its sole discretion from time to time upon written
notice to the Company, any relevant notice, demand or election in whole or in
part without prejudice to its future actions and rights
(o) Payment Set Aside. To the extent that the Company makes a payment or
payments to the Buyers hereunder or pursuant to any of the other Transaction
Documents or the Buyers enforce or exercise their rights hereunder or
thereunder, and such payment or payments or the proceeds of such enforcement or
exercise or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside, recovered from, disgorged by or are
required to be refunded, repaid or otherwise restored to the Company, a trustee,
receiver or any other Person under any law (including, without limitation, any
bankruptcy law, state or federal law, common law or equitable cause of action),
then to the extent of any such restoration the obligation or part thereof
originally intended to be satisfied shall be revived and continued in full force
and effect as if such payment had not been made or such enforcement or setoff
had not occurred.
(p) Independent Nature of Buyers' Obligations and Rights. The obligations
of each Buyer under any Transaction Document are several and not joint with the
obligations of any other Buyer, and no Buyer shall be responsible in any way for
the performance of the obligations of any other Buyer under any Transaction
Document. Nothing contained herein or in any other Transaction Document, and no
action taken by any Buyer pursuant hereto or thereto, shall be deemed to
constitute the Buyers as a partnership, an association, a joint venture or any
other kind of entity, or create a presumption that the Buyers are in any way
acting in concert or as a group with respect to such obligations or the
transactions contemplated by the Transaction Documents and the Company
acknowledges that the Buyers are not acting in concert or as a group with
respect to such obligations or the transactions contemplated by the Transaction
Documents. Each Buyer confirms that it has independently participated in the
negotiation of the transaction contemplated hereby with the advice of its own
counsel and advisors. Each Buyer shall be entitled to independently protect and
enforce its rights, including, without limitation, the rights arising out of
this Agreement or out of any other Transaction Documents, and it shall not be
necessary for any other Buyer to be joined as an additional party in any
proceeding for such purpose.
W02-SD:8SL1\51397971.3 -25-
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IN WITNESS WHEREOF, each Buyer and the Company have caused its respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.
COMPANY:
SPACEDEV, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
---------------------------------------
President and Chief Financial Officer
W02-SD:8SL1\51397971.3 -26-
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IN WITNESS WHEREOF, each Buyer and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.
BUYERS:
LAURUS MASTER FUND, LTD.
By: /s/ Xxxxxx Grin
--------------------------------------
Director
W02-SD:8SL1\51397971.3 -27-
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