FORM OF
SHARE SUBSCRIPTION AGREEMENT
AGREEMENT dated as of March _, 1994 by and between AIRSHIP
INTERNATIONAL LTD., a New York corporation (the "Company"), and
____________________________ having an address at _______________________ (the
"Purchaser").
WITNESSETH
WHEREAS, the Company is in the business of operating lighter-than-air
crafts, also known as airships, blimps or dirigibles;
WHEREAS, the Purchaser desires to subscribe for and purchase, and the
Company desires to sell and issue to the Purchaser, the number of shares of the
Company's common stock, par value $.01 per share, set forth below.
NOW, THEREFORE, in consideration of the premises and the respective
mutual agreements, covenants, representations and warranties herein contained,
and for other good and valuable consideration, the receipt and sufficiency of
which hereby are acknowledged, the parties agree as follows:
1. Purchase and Sale of Shares. Subject to all of the terms and
conditions of this Agreement, the Purchaser hereby subscribes for and shall
purchase, and the Company shall sell to the Purchaser, ___________ common shares
(the "Shares") of its capital stock for a total purchase price of $_____________
(the "Purchase Price").
2. Closing.
(a) Time and Place. The closing (the "Closing") of the
transaction contemplated by this Agreement shall be held at the offices of
Airship International Ltd., 0000 Xxxx Xxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx,
00000, at 4:00 p.m. Local time on the date hereof or at such other place and
time as may be agreed upon by the parties (the time and date upon which the
Closing occurs herein called the "Closing Date").
(b) Delivery by Company. At the Closing, against payment by
Purchaser of the Purchase Price, the Company shall deliver to the Purchaser a
share certificate registered in the purchaser's name and representing the
Shares, which certificate shall bear the legend set forth in Section 3 (e)
hereof.
(c) Payment of the Purchase Price the Purchaser. At the Closing,
the Purchaser shall pay the Purchase Price by means of a bank wire transfer to
an account designated by the Company or by such other means as the parties may
mutually agree upon.
3. Purchaser's Representations, Warranties and Covenants. Purchaser
represents and warrants to, and covenants with, the Company as follows:
(a) Investment Intention. Purchaser is acquiring the Shares for
Purchaser's own account and not with a present intention to make any sale,
disposition, distribution or other transfer of the Shares in a manner that will
be in violation of any applicable securities laws.
(b) Access to Information. Purchaser has the financial
sophistication necessary to enable him to make an informed decision relating to
his investment in the Company and he has been given adequate opportunity (i) to
obtain information and documents relating to the Purchaser's investment in the
Shares and (ii) to ask questions and receive answers about such documents and
Company, its business and future prospects; and that these opportunities have
provided the Purchaser with the information necessary or desirable to make an
evaluation of the merits and risks relating to Purchaser's investment.
(c) Status of and Accredited Investor. Purchaser is an
"accredited investor" (as that term is defined in Rule 501 of Regulation D
promulgated under the Securities Act of 1933, as amended (the "Securities Act"),
a copy of which definition is annexed hereto as Exhibit A.
(d) Restrictions on Transferability. Purchaser understands that
the Shares have not been registered under the Securities Act or under the
securities law of any state, and, except as provided in Section 6, that the
Company will be under no obligation to register any of the Shares. Purchaser
agrees that he will not sell, transfer, encumber or otherwise dispose
(collectively, "transfer") his Shares or any interest therein except in
accordance with applicable securities laws.
(e) Legend. To give effect to the restrictions on transfer set
forth in Section 3 (d) hereof, Purchaser understands that the certificate
representing the Shares shall bear a legend in substantially the following form,
and Purchaser shall not transfer any or all of the Shares or any interest
therein, except in accordance with the terms of such legend:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"1933 Act"), and no transfer of such securities may be made in
violation of the of the 1933 Act and the rules and regulation
promulgated thereunder. Such securities were issued pursuant to a
Share Subscription Agreement (the "Agreement") between the
registered owner hereof and the issuing corporation which, among
other things, restricts the sale, transfer or other disposition
of such securities. No sale, transfer or other disposition of
such securities or any rights attaching or attendant thereto
shall be valid unless made in accordance with the terms, and
subject to the conditions, of the Agreement. A copy of Agreement
is on file at the office of the issuing corporation."
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4. Representations, Warranties and Covenants of the CompanY. The
Company represents and warrants to, and covenants with the Purchaser as
follows:
(a) Authorization. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly and
validly authorized and approved by all necessary corporate actions of the
Company.
(b) SEC Reports. The Company has previously furnished Purchaser
with true and complete copies of its (i) annual reports on Form 10-K for the
years ended December 31, 1992 and December 31, 1991, respectively, as filed
with the Securities and Exchange Commission (the "SEC"),(ii) proxy statements
relating to all meetings of its shareholders during fiscal year 1993 and (iii)
all other reports or registration statements filed by the Company with the SEC
since December 31, 1993 (collectively, the "SEC Reports"). As of their
respective dates, the SEC Reports did not contain any untrue statements of a
material fact or omit to state any material fact required to be stated
misleading.
(c) Capitalization. As of the date of this Agreement, the
authorized capital stock of the Company consists of (i) 10,000,000 shares of
preferred stock, par values $.01 per share of which 2,875,000 shares are
outstanding and (ii) 80,000,000 shares of common stock, par value $.01 per
share, of which 27,448,000 shares are issued and outstanding. Except for the
outstanding options and warrants to purchase shares of the Company's common
stock, which are disclosed in Footnote 8 to the Company's audited financial
statements included in the 1992 10-K, there are no outstanding or authorized
options, warrants or rights to purchase or acquire any capital stock of the
Company or any securities convertible into or evidencing the right to subscribe
for any shares of its capital stock.
(d) Validity of Shares. The Shares, when issued, delivered and
paid for in accordance with the terms hereof, will be duly delivered and paid
for in accordance with the terms hereof, will be duly and validly issued, fully
paid and non-assessable and shall be free and clear of all liens, claims and
encumbrances.
5. Mutual Representations. Each party hereto represents and warrants to
the other that:
(a) The execution and delivery of this Agreement and fulfillment
of the terms hereof (i) will not constitute a default under or conflict with
any agreement or other instrument to which such party is a party or by which
such party is bound and (ii) do not require the consent of any person or
entity; and
(b) This Agreement constitutes the valid and binding obligation
of such party enforceable against such party in accordance with its terms,
except as may be limited by (i) applicable bankruptcy, insolvency, moratorium
and similar laws affecting creditors rights generally, and (ii) general
principles governing the availability of equitable remedies.
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6. Registration Rights.
(a) Piggyback and Demand Registration Rights.
The Company agrees that prior to June 30, 1994, the Board
of Directors of the Company shall authorize the filing of a registration
statement under the Securities Act registering shares of its stock of any class
on a form other than Form S-4, or Form S-8, it will give notice to Purchaser at
least 30 days prior to the date of filing of the proposed registration
statement. Upon request by Purchaser with 15 days after receipt of such notice,
the Company will use reasonable efforts to include the securities to be
registered by such registration statement all of the Shares of the Purchaser.
(b) Limitations. With respect to any registration statement in
which Purchaser's Shares may be included pursuant to the provisions of this
Section 6, the Company agrees to use its best efforts to register Purchaser's
Shares for Sale, and maintain such registration in effect for a period of two
years, subject to the following limitations:
(i) In no event shall the Company be obligated to qualify to
do business in any jurisdiction where it is not so qualified or to take any
action that would subject it to tax or to service of process (other than
service of process under state securities laws) in any jurisdiction where it is
not subject thereto.
(ii) The Company will not be obligated to furnish any
audited financial statements other than the audited financial statements
customarily prepared at the end of the fiscal year or to furnish any unaudited
financial information with respect to any period other than interim quarterly
periods, unless Purchaser undertakes to pay the additional cost to the Company
for such financial statements or financial information.
(iii) The Company will pay the expenses of such registration,
except that the Purchaser shall pay all underwriting discounts and commissions
applicable to his Shares and all legal fees and expenses of his own counsel, if
any.
(iv) The right of the Purchaser to have his Shares included
in any registration statement may not be exercised more than once.
(c) Indemnification. (i) In connection with any registration of
securities pursuant to this Agreement, to the extent permitted by law, the
Company shall indemnify the Purchaser and the Purchaser shall indemnify the
Company in the manner provided in the Section 6(c).
(ii) The Company will indemnify and hold harmless the
Purchaser and each underwriter of the Shares being so registered, and each
other person, if any, who controls the Purchaser or such underwriter within the
meaning of Section 15 of the Securities Act or Section 20 of the Securities
Exchange Act of 1934, as the case may be, against any losses,
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claims, damages or liabilities, joint or several, to which the Purchaser or
such underwriter or controlling person may become subject under the Securities
Act, insofar as such losses, claims, damages or liabilities (or action in
respect thereof) arise out of or are based upon any untrue statement of any
material fact contained, on the effective date thereof, in any registration
statement under which such securities were registered under the Securities Act,
any preliminary prospectus of final prospectus contained therein, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse the Purchaser or such underwriter and each such controlling person
for any legal or any other expenses reasonable incurred by the Purchaser or
such underwriter or such controlling person in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Company will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
such registration statement, said preliminary prospectus or said prospectus or
said amendment or supplement in reliance upon written information furnished to
the Company by the Purchaser or such underwriter specifically for use in the
preparation thereof, and provided, further however, that the foregoing
indemnity agreement with respect to any preliminary prospectus shall not inure
to the benefit of the Purchaser or any such underwriter and each such
controlling person of such underwriter from whom the person asserting any such
losses, claims, damages or liabilities purchased the Shares, if a copy of the
final prospectus (as then amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) was not sent or given to such
person by or on behalf of the Purchaser or any such underwriter if required by
law so to have been delivered, at or prior to written confirmation of the sale
of the Shares to such person, and if the final prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage or liability.
(iii) The Purchaser will indemnify and hold harmless the
Company, each officer and director and representative of the company and each
person who controls the Company to the same extent that the Company agrees to
indemnify it but only with respect to the written information relating to the
Purchaser specifically for use in the registration statement concerned.
(iv) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought hereunder, such person (hereinafter called the
indemnified party) shall promptly notify the person against whom such indemnity
may be sought (hereinafter called the indemnifying party) in writing of the
commencement thereof and the indemnifying party shall have the defense thereof
with counsel reasonably satisfactory to the parties. The indemnifying party
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be final
judgement for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment
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(v) If for any reason the indemnification provided for in
the preceding clauses of this Section 6 is unavailable to any indemnified party
or insufficient to hold it harmless as contemplated by the preceding clauses of
this Section 6, then the indemnifying party shall contribute to the amount paid
or payable by the indemnified party as a result of the relative benefits
received by the indemnified party and the indemnifying party, as well as any
other relevant equitable considerations, provided, no person guilty of
fraudulent misrepresentation (within the meaning of Section ll(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
7. Miscellaneous.
(a) Cooperation. Subject to the terms and conditions herein
provided, each of the parties hereto shall use its best efforts to take, or
cause to be taken, such action, to execute and deliver, or cause to be executed
and delivered, such additional documents and the provisions of this Agreement
and under applicable law to consummate and make effective the transactions
contemplated hereby.
(b) Notices. Any notice or other communication required or
permitted hereunder shall be in writing and shall be delivered personally,
telegraphed, telexed, sent by facsimile transmission or sent by mail, postage
prepaid. Any such notice shall be deemed given when so delivered personally,
telegraphed, telexed or sent by facsimile transmission or, if mailed by
certified or registered mail, five days after the date of deposit in the mails,
as follows:
if to the Company, one copy to: with a copy to:
Airship International Ltd. Xxxx, Marks & Xxxxx
0000 Xxxx Xxxx Xxxx, Xxxxx 000 000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx, 00000 Xxx Xxxx, Xxx Xxxx, 00000
Attention: Xxxxx X. Xxxxxxxx Attention: Xxxxx Xxxxxx
Telecopier: (000) 000-0000 Telecopier: (000) 000-0000
If to the Purchaser, one copy to:
(See front page.)
Any party, by notice given in accordance with this Section to the other
party, may designate another address or person for receipt of notices
hereunder. Notices by a party may be given by counsel to such party.
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(c) Entire Agreement. This Agreement contains the entire
agreement among the parties with respect to the subject matter hereof and
superseded all prior agreements or undertakings, written or oral, of any nature
whatsoever,
(d) Amendments. This Agreement may not be amended nor shall any
waiver, change modification, consent or discharge be effected except by an
instrument in writing executed by or on behalf of the party seeding or against
whom enforcement of any amendment, waiver, change, modification, consent or
discharge is sought.
(e) No Waiver. Any failure or delay on the party of a party in
exercising any power or right hereunder shall not operate as a waiver thereof,
nor shall any single or partial exercise of any such right or power preclude
any other or further exercise thereof or the exercise of any other right or
power hereunder or otherwise available in law or in equity.
(f) Severability. If any provisions of this Agreement for any
reason shall be held to be illegal, invalid, or unenforceable, such illegality
shall not effect any other provision of this Agreement, but this Agreement
shall be construed as if such illegal, invalid or unenforceable provision had
never been herein.
(g) Governing Law. This Agreement shall be governed and
construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed entirely within such State.
(h) Binding Effect. This Agreement and all of its provisions,
rights and obligations shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors. This Agreement may not be
assigned by either party without the express written consent of the other and
any purported assignment, unless so consented to, shall be void and without
effect. Nothing herein express or implied is intended or shall be construed to
confer upon or to give anyone other than the parties hereto and their
respective representatives and successors any rights or benefits under or by
reason of this Agreement. Accordingly, no party that has not executed this
Agreement shall have any right to enforce any of the provisions of this
Agreement.
(i) Counterparts. The Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument. This Agreement shall become binding
when one or more counterparts hereof, individually or taken together, shall
bear the signatures of all of the parties reflected hereon as the signatories.
(j) Captions. The section and other headings contained in this
Agreement are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
AIRSHIP INTERNATIONAL, LTD.
By: /s/ XXXXX X. XXXXXXXX
_______________________________
Name: Xxxxx X. Xxxxxxxx
Title: President
By: /s/
_______________________________
Name: Xxxxx & Xxxxxxx Xxxxxxxxx
(Purchaser)
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