EXHIBIT 99.3
NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS
EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR
THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES.
PREFERRED STOCK PURCHASE WARRANT
____ Units
PSW No. _________ Representing _______ Shares of Series D Preferred Stock
and Warrants to Purchase _____ shares of Common Stock
SPACEDEV, INC.
THIS PREFERRED STOCK PURCHASE WARRANT (the "Preferred Stock Warrant")
certifies that, for value received, ____________ (the "Holder"), is entitled,
upon the terms and the conditions hereinafter set forth, at any time on or after
the Effective Date hereof (the "Initial Exercise Date") and on or prior to the
close of business on the twelve month anniversary of the Initial Exercise Date
(the "Termination Date") but not thereafter, to subscribe for and purchase from
SpaceDev, Inc., a Colorado corporation (the "Company") an aggregate of ,
________ shares of Series D Preferred Stock, par value $0.001, and (ii) Warrants
to purchase an aggregate of _____ shares of Common Stock, par value $0.0001 per
share (the "Warrant Share Maximum"), of the Company (the "Common Stock"), in
each case subject to adjustment pursuant to Section 3 hereof. A "Unit" as used
herein shall mean a share of Series D Preferred Stock plus Warrants to purchase
a number of shares of Common Stock equal to [32.52%] of the number of shares
initially issuable upon conversion of such share of Series D Preferred Stock. In
determining the aggregate number of Warrants that shall be issued from time to
time upon exercise of this Preferred Stock Warrant, the Units shall be
aggregated and the Warrants issued upon each exercise shall be rounded up or
down to the nearest whole number of Warrant Shares subject to such Warrants,
except in the case of exercise of this Preferred Stock Warrant for the full
number of securities then subject to this Preferred Stock Warrant, Warrants in
respect of the remaining balance of the Warrant Shares covered by this Preferred
Stock Warrant shall be issued. In no event shall the Company be obligated to
issue in the aggregate Warrants to purchase more than the Warrant Share Maximum.
PAGE 1
Section 1. Definitions. Capitalized terms used and not otherwise defined
herein shall have the meanings set forth in that certain Securities Purchase
Agreement (the "Purchase Agreement"), dated January 13, 2006, among the Company
and the purchasers signatory thereto. This Preferred Stock Warrant is a
Preferred Stock Warrant as that term is defined under the Purchase Agreement.
Section 2. Exercise.
(a) Exercise of Preferred Stock Warrant. Exercise of the purchase rights
represented by this Preferred Stock Warrant may be made, in whole or in part, at
any time or times on or after the Initial Exercise Date and on or before the
Termination Date by delivery to the Company of a duly executed facsimile copy of
the Notice of Exercise Form annexed hereto (or to such other office or agency of
the Company as it may designate by notice in writing to the registered Holder at
the address of such Holder appearing on the books of the Company). A closing
(the "Closing") with respect to the issuance of the Series D Preferred Stock and
Warrants upon exercise of this Preferred Stock Warrant shall take place within
10 Trading Days after the Company's receipt of the Notice of Exercise (the date
designated shall be the "Closing Date"). Partial exercises of this Preferred
Stock Warrant resulting in purchases of a portion of the total number of Units
available hereunder shall have the effect of lowering the outstanding number of
Units purchasable hereunder in an amount equal to the applicable number of Units
purchased. The purchase of Units by the Holder pursuant to the exercise of the
Company Option shall also reduce the number of Units covered by this Preferred
Stock Warrant by the number of Units so purchased by the Holder. The Holder and
the Company shall maintain records showing the number of Units purchased and the
date of such purchases. The Company shall deliver any objection to any Notice of
Exercise Form within 2 Business Days of receipt of such notice. In the event of
any dispute or discrepancy, the records of the Company shall be controlling and
determinative in the absence of manifest error. The Holder and any assignee, by
acceptance of this Preferred Stock Warrant, acknowledge and agree that, by
reason of the provisions of this paragraph, following the purchase of a portion
of the Units hereunder, the number of Units available for purchase hereunder at
any given time may be less than the amount stated on the face hereof. In no
event may the Holder exercise this Preferred Stock Warrant in whole or in part
unless the Holder is an "accredited investor" as defined in Rule 501(a) under
the Securities Act.
(b) Exercise Price. The exercise price under this Preferred Stock Warrant
shall be equal to $1,000 per Unit (the "Exercise Price").
(c) Deliveries.
(i) On the Closing Date, the Company shall deliver or cause to be
delivered to the Holder the following:
(1) If this Preferred Stock Warrant is exercised for less than
all the Units covered thereby, the Company shall deliver a new
Preferred Stock Purchase Warrant for the remaining Units;
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(2) Written confirmation of the issuance of the number of shares
of Series D Preferred Stock being purchased at the Closing;
(3) the Warrants purchased at the Closing issued in the name of
the Holder;
(4) a certificate evidencing the incorporation (or other
organization) and good standing of the Company and each of its
Subsidiaries in such entity's state of incorporation or organization
as of a date within ten (10) days of the Closing Date;
(5) a certified copy of the Corporation's Certificate of
Incorporation as amended, including the Certificate of Designation
with respect to the Series D Preferred Stock purchased at the Closing,
as certified by the Secretary of State of the State of Colorado as of
a date within ten days of the Closing Date; and
(6) a certificate of the Chief Executive Office and Chief
Financial Officer of the Company to the effect that all of the
representations and warranties of the Company set forth in the
Purchase Agreement are true and correct as of the Closing Date (except
as disclosed in updated Disclosure Schedules attached to such
certificate which disclosure schedules shall be reasonably acceptable
to the Holder) and the Company has performed all of its obligations
under the Transaction Documents required to be performed prior to the
Closing Date.
(ii) At the Closing, the Holder shall deliver or cause to be delivered
to the Company the following:
(1) The Holder's Exercise Price for the Units being purchased by
wire transfer to the account specified in writing by the Company; and
(2) the original Preferred Stock Warrant.
(d) Closing Conditions.
The obligations of the Holder hereunder to purchase the Units in connection
with the Closing are subject to the following conditions being met:
(1) the accuracy in all respects on the Closing Date of the
representations and warranties of the Company contained in the
Purchase Agreement as supplemented by the Updated Disclosure Schedules
attached to the certificate delivered pursuant to Section 2(c)(6)
above which shall be reasonably satisfactory to the Holder;
(2) all obligations, covenants and agreements of the Company
under the Transaction Documents required to be performed at or prior
to the Closing Date shall have been performed;
(3) the delivery by the Company of the items set forth in Section
2.2(c)(i);
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(4) there shall have been no Material Adverse Effect with respect
to the Company since the Closing Date under the Purchase Agreement;
and
(5) from the date the Notice of Exercise Form was delivered to
the Company to the Closing Date, trading in the Common Stock shall not
have been suspended by the Commission, and, trading in securities
generally as reported by Bloomberg Financial Markets shall not have
been suspended or limited, or minimum prices shall not have been
established on securities whose trades are reported by such service,
or on any Trading Market, nor shall a banking moratorium have been
declared either by the United States or New York State authorities nor
shall there have occurred any material outbreak or escalation of
hostilities or other national or international calamity of such
magnitude in its effect on, or any material adverse change in, any
financial market which, in each case, in the reasonable judgment of
the Holder, makes it impracticable or inadvisable to purchase the
Series D Preferred Stock and Warrants at the time of exercise.
(e) Mechanics of Exercise.
(i) Authorization of Warrant Shares. The Company covenants that (a)
all Series D Preferred Stock which may be issued upon the exercise of the
purchase rights represented by this Preferred Stock Warrant will, when
issued in accordance with the terms hereof, be duly authorized, validly
issued, fully paid and nonassessable and free from all taxes, liens and
charges in respect of the issue thereof (other than taxes in respect of any
transfer occurring contemporaneously with such issue) and (b) the Warrants
which may be issued upon exercise of the purchase rights represented by
this Preferred Stock Warrant will, when issued in accordance with the terms
hereof be duly authorized, executed and delivered by the Company and
constitute binding obligations of the Company, enforceable in accordance
with their terms.
(ii) Charges, Taxes and Expenses. Issuance of the Series D Preferred
Stock and Warrants shall be made without charge to the Holder for any issue
or transfer tax or other incidental expense in respect of the issuance
thereof, all of which taxes and expenses shall be paid by the Company.
Section 3. Certain Adjustments.
If as of the Termination Date there remain any unpurchased Units under the
Preferred Warrant issued under the Purchase Agreement, and all of the Units for
which this Preferred Stock Warrant was originally issued to the Holder on the
Closing Date under the Purchase Agreement shall have been purchased either
pursuant to the exercise of this Preferred Stock Warrant or upon exercise of the
Company Option, then notwithstanding anything in this Preferred Stock Warrant to
the contrary, the Preferred Stock Warrant shall become exercisable for
additional Units calculated as follows: the total number of unpurchased Units of
all Purchasers in the aggregate shall be multiplied by a fraction, the numerator
of which shall be the Holder's Subscription Amount and the denominator of which
shall be the sum of the Holder's Subscription Amount and the total Subscription
Amounts of other Purchasers similarly situated (who have exercised their
Preferred Stock Warrants in full) and any limits not purchased by such other
Purchasers shall again be allocated pro rata using a like fraction to such of
the Holder and such other Purchasers who elect to purchase any remaining Units.
The Company shall notify the Holder on the Termination Date of the number of
available Units and the number of such Units initially allocated to the Holder.
PAGE 4
This Preferred Stock Warrant may be exercised for up to the full number of
additional Units allocated to the Holder pursuant to the foregoing within five
(5) Trading Days from the receipt of the Company's notice as aforesaid and the
Closing with respect to any such exercise shall take place within 15 Trading
Days from the receipt of the Company's notice.
Section 4. Transfer of Warrant.
(a) Transferability. This Warrant may only be assigned to an assignee of
the Holder's rights under the Purchase Agreement and to a Person who assumes the
Holders obligations under the Purchase Agreement, and otherwise in accordance
with the Purchase Agreement.
(b) Warrant Register. The Company shall register this Preferred Stock
Warrant, upon records to be maintained by the Company for that purpose (the
"Preferred Stock Warrant Register"), in the name of the record Holder hereof
from time to time. The Company may deem and treat the registered Holder of this
Warrant as the absolute owner hereof for the purpose of any exercise hereof or
any distribution to the Holder, and for all other purposes, absent actual notice
to the contrary.
Section 5. Miscellaneous.
(a) No Rights as Shareholder Until Exercise. This Preferred Stock Warrant
does not entitle the Holder to any voting rights or other rights as a
shareholder of the Company prior to the exercise hereof. Upon the surrender of
this Preferred Stock Warrant and the payment of the aggregate Exercise Price,
the Series D Preferred Stock and Warrants so purchased shall be and be deemed to
be issued to such Holder as the record owner of such shares and Warrants as of
the Closing Date.
(b) Loss, Theft, Destruction or Mutilation of Preferred Stock Warrant. The
Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this
Preferred Stock Warrant, and in case of loss, theft or destruction, of indemnity
or security reasonably satisfactory to it (which, in the case of the Preferred
Stock Warrant, shall not include the posting of any bond), and upon surrender
and cancellation of such Preferred Stock Warrant, if mutilated, the Company will
make and deliver a new Preferred Stock Warrant of like tenor and dated as of
such cancellation, in lieu of such Preferred Stock Warrant.
(c) Saturdays, Sundays, Holidays, etc. If the last or appointed day for the
taking of any action or the expiration of any right required or granted herein
shall be a Saturday, Sunday or a legal holiday, then such action may be taken or
such right may be exercised on the next succeeding day not a Saturday, Sunday or
legal holiday.
(d) Authorized Shares.
(i) The Company covenants that during the period the Preferred Stock
Warrant is outstanding, it will reserve from its authorized and unissued
PAGE 5
preferred stock a sufficient number of shares of preferred stock to provide
for the issuance of the Series D Preferred Stock upon the exercise of any
purchase rights under this Preferred Stock Warrant. The Company will take
all such reasonable action as may be necessary to assure that such Series D
Preferred Stock and Warrants may be issued as provided herein without
violation of any applicable law or regulation, or of any requirements of
the Trading Market upon which the Common Stock may be listed.
(ii) Except and to the extent as waived or consented to by the Holder,
the Company shall not by any action, including, without limitation,
amending its articles of incorporation or through any reorganization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Preferred Stock
Warrant, but will at all times in good faith assist in the carrying out of
all such terms and in the taking of all such actions as may be necessary or
appropriate to protect the rights of Holder as set forth in this Preferred
Stock Warrant against impairment. Without limiting the generality of the
foregoing, the Company will (a) not increase the par value of any Series D
Preferred above the amount payable therefor upon such exercise immediately
prior to such increase in par value or increase the par value of its Common
Stock above the exercise price of the Warrants issuable upon exercise of
the Preferred Stock Warrant, (b) take all such action as may be necessary
or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable Series D Preferred Stock upon the exercise of
this Preferred Stock Warrant, and (c) use commercially reasonable efforts
to obtain all such authorizations, exemptions or consents from any public
regulatory body having jurisdiction thereof as may be necessary to enable
the Company to perform its obligations under this Preferred Stock Warrant.
(e) Jurisdiction. All questions concerning the construction, validity,
enforcement and interpretation of this Preferred Stock Warrant shall be governed
by and construed and enforced in accordance with the internal laws of the State
of New York, without regard to the principles of conflicts of law thereof. The
Company and the Holder agree that all legal proceedings concerning the
interpretations, enforcement and defense of the transactions contemplated by
this Preferred Stock Warrant (whether brought against one of them or its
respective affiliates, directors, officers, shareholders, employees or agents)
shall be commenced exclusively in the state and federal courts sitting in the
City of New York. The Company and the Holder hereby irrevocably submit 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 (including with respect to the enforcement of this Preferred Stock
Warrant), and hereby irrevocably waive, and agree 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 improper
or inconvenient venue for such proceeding. Each of the Company and the Holder
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
via registered or certified mail or overnight delivery (with evidence of
delivery) to such Person at the address in effect for notices to it under the
Purchase 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 of the Company and the Holder hereby waive all rights to a trial by
jury. If either the Company or the Holder shall commence an action or proceeding
PAGE 6
to enforce any provisions of this Preferred Stock Warrant, then the prevailing
party in such action or proceeding shall be reimbursed by the opposing party for
its attorneys' fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such action or proceeding.
(f) Restrictions. The Holder acknowledges that the Series D Preferred Stock
and Warrants acquired upon the exercise of this Preferred Stock Warrant, if not
registered, will have restrictions upon resale imposed by state and federal
securities laws.
(g) Nonwaiver and Expenses. No course of dealing or any delay or failure to
exercise any right hereunder on the part of Holder shall operate as a waiver of
such right or otherwise prejudice Xxxxxx's rights, powers or remedies. If the
Company willfully and knowingly fails to comply with any provision of this
Preferred Stock Warrant, which results in any material damages to the Holder,
the Company shall pay to Holder such amounts as shall be sufficient to cover any
costs and expenses including, but not limited to, reasonable attorneys' fees,
including those of appellate proceedings, incurred by Holder in collecting any
amounts due pursuant hereto or in otherwise enforcing any of its rights, powers
or remedies hereunder.
(h) Notices. Any notice, request or other document required or permitted to
be given or delivered to the Holder by the Company shall be delivered in
accordance with the notice provisions of the Purchase Agreement.
(i) Limitation of Liability. No provision hereof, in the absence of any
affirmative action by the Holder to exercise this Preferred Stock Warrant or
purchase Series D Preferred Stock or Warrants, and no enumeration herein of the
rights or privileges of Holder, shall give rise to any liability of Holder for
the purchase price of any Series D Preferred Stock or Warrants or as a
shareholder of the Company, whether such liability is asserted by the Company or
by creditors of the Company.
(j) Remedies. The Holder, in addition to being entitled to exercise all
rights granted by law, including recovery of damages, will be entitled to
specific performance of its rights under this Preferred Stock Warrant. The
Company agrees that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of the provisions of this Preferred
Stock Warrant and hereby agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.
(k) Successors and Assigns. Subject to applicable securities laws, this
Preferred Stock Warrant and the rights and obligations evidenced hereby shall
inure to the benefit of and be binding upon the successors of the Company and
the successors and permitted assigns of Holder. The provisions of this Preferred
Stock Warrant are intended to be for the benefit of all Holders from time to
time of this Preferred Stock Warrant and shall be enforceable by any such
Holder.
(l) Amendment. This Preferred Stock Warrant may be modified or amended or
the provisions hereof waived by a written instrument signed by each of the
Company and the Holder.
PAGE 7
(m) Severability. Wherever possible, each provision of this Preferred Stock
Warrant shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Preferred Stock Warrant shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions of
this Preferred Stock Warrant.
(n) Headings. The headings used in this Preferred Stock Warrant are for the
convenience of reference only and shall not, for any purpose, be deemed a part
of this Preferred Stock Warrant.
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IN WITNESS WHEREOF, the Company has caused this Preferred Stock Warrant to be
executed by its officer thereunto duly authorized.
Dated: January 13, 2006
SpaceDev, Inc.
By: /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
Title: President and Chief Financial Officer
PAGE 9
NOTICE OF EXERCISE
TO: SpaceDev, Inc.
(1) The undersigned hereby elects to purchase ________ Units of the Company
pursuant to the terms of the Preferred Stock Warrant dated _______________, and
subject to the satisfaction of the conditions to Closing, shall tender herewith
payment of the exercise price in full at the Closing which shall be on
___________________________.
(2) Payment shall take the form of (check applicable box):
[ ] in lawful money of the United States; or
(3) Please issue the Series D Preferred Stock and the Warrants in the name
of the undersigned or in such other name as is specified below:
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(4) Accredited Investor; Investor Representation. The undersigned is
an "accredited investor" as defined in Regulation D promulgated under the
Securities Act of 1933, as amended. The undersigned represents and warrants that
the shares of Common Stock to be issued upon exercise hereof are being acquired
solely for the account of the undersigned and not as a nominee for another
Person and that the undersigned will not offer, sell or otherwise dispose of any
such shares of Common Stock except under circumstances that are not in violation
of the Securities Act of 1933, as amended or any applicable state securities
laws.
[SIGNATURE OF HOLDER]
Name of Investing Entity:
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Signature of Authorized Signatory of Investing Entity:
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Name of Authorized Signatory:
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Title of Authorized Signatory:
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Date:
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