Exhibit 4.1
NOTE PURCHASE AGREEMENT
NOTE PURCHASE AGREEMENT, made and entered as of this _______ day of
________ 2002 (the "Agreement"), by and among SpaceDev, Inc., a Colorado
corporation (the "Company"), and the purchaser(s) set forth on THE SIGNATURE
PAGE hereto (each a "Purchaser" and, collectively, the "Purchasers").
WITNESSETH:
WHEREAS, the Company desires to issue and sell, and the Purchasers
desire to purchase, all upon the terms and subject to the conditions set forth
in this Agreement, Series A Convertible Notes of the Company (individually, a
"Note" and, collectively, the "Notes") in the aggregate principal amount of up
to $400,000 each bearing interest at the rate of 2.03% per annum, which are
convertible into securities of the Company, as set forth herein.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements of the parties herein contained, the parties hereby
agree as follows:
1. PURCHASE AND SALE OF NOTES.
1.1 SALE AND ISSUANCE OF NOTES. Subject to the terms and
conditions of this Agreement, each Purchaser severally and not jointly agrees to
purchase, and the Company agrees to sell and issue to each Purchaser, a Note of
this Company which shall be subordinate to all other debt of the Company, and
which shall convert into such number of securities as determined pursuant to
Section 1.3 herein. The Company further agrees that, upon issuance of the Note,
the Company shall also deliver to each Purchaser a warrant to purchase _____
shares of the Company's $0.0001 par value common stock (the "Warrant" or
"Warrants"). The Warrant shall be exercisable at any time after issuance at the
conversion price of the Note. Forms of the Note and Warrant are attached hereto
as EXHIBITS A AND B.
1.2 CLOSING. (i) The closing of the purchase and sale of the
Notes (the "Closing") shall take place at such time and place as shall be
mutually agreed upon by the Purchasers and the Company. At the Closing and upon
receipt of a certified check or a wire transfer of the principal amount of each
Note to an account that will have been designated by the Company not less than
one (1) business day prior to the date of the Closing, the Company shall deliver
to each Purchaser a Note.
1.3 NOTE CONVERSION. The Company may, at its option, convert
each Note into shares of the Company's common stock equal in number to the
outstanding principal amount and accrued interest on such Note divided by the
Conversion Price (as defined in Section 2.2 of the Note) on the Maturity Date of
the Note.
Upon conversion, the Notes shall cease to represent the
indebtedness of the Company stated therein and the sole right of the holder
thereof shall be to receive certificates or instruments evidencing the common
shares to which such holder is entitled. Upon conversion, such Purchaser agrees
to promptly surrender to the Company the Note held by it in exchange for the
common shares as provided in the Note. Fractional shares of common stock shall
not be issued and fractions shall be settled in cash at the conversion price.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents, warrants and covenants to the Purchasers as follows:
2.1 CORPORATE STATUS. The Company is a corporation duly
incorporated, validly existing, and in good standing under the laws of the state
of Colorado, and has all requisite corporate power and authority to own, operate
and lease its properties and to carry on its business as and in the places where
such properties are now owned, operated and leased or such business is now being
conducted. The Company is subject to the reporting requirements of the
Securities Exchange Act of 1934, and is in compliance with those requirements.
2.2 AUTHORIZATION; VALIDITY. When executed and delivered by
the Company, this Agreement, the Notes and the Warrants will constitute the
valid and legally binding obligations of the Company, enforceable against the
Company in accordance with their terms, subject to applicable bankruptcy,
insolvency, reorganization and moratorium laws and other laws of general
application affecting the enforcement of creditors' rights generally and general
principles of equity. Upon issuance, the shares of common stock issued by the
Company upon conversion of the Notes and/or exercise of the Warrants (the
"Conversion Shares") shall be duly authorized, validly issued, fully paid and
non-assessable, and free of any liens or encumbrances or preemptive rights,
except for restrictions on transfer under the securities laws and any agreement
to which the holder of the Conversion Shares becomes a party.
2.3 NO CONFLICT. The execution, delivery and performance of
this Agreement, the Notes and the Warrants and the issuance of the Conversion
Shares do not and will not violate any material agreements to which the Company
is, or at the time of issuance will be, a party. The Company is not in violation
of or default on any provision of any contract, indenture or other agreement to
which it is a party or by which it is bound, which violation or default would
materially and adversely affect the business of the Company taken as a whole.
2.4 APPROVALS AND CONSENTS. No action, approval, consent or
authorization, including, but not limited to, any action, approval, consent or
authorization by any governmental or quasi-governmental board, agency,
commission, bureau, or instrumentality is necessary or required as to the
Company in order to constitute this Agreement as a valid, binding and
enforceable obligation of the Company in accordance with its terms.
2.5 AUTHORIZATION AND RESERVATION OF CONVERSION SHARES. The
Company shall authorize and reserve sufficient shares of Conversion Shares to
enable the conversion of the Notes and exercise of the Warrants.
3. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS. Each of the
Purchasers, severally but not jointly, represents and warrants to the Company as
to itself as follows:
3.1 AUTHORIZATION. The execution, delivery and performance of
this Agreement, by such Purchaser and the consummation by such Purchaser of the
transactions contemplated hereby and thereby are within the powers of such
Purchaser and have been duly authorized by all necessary individual, corporate,
partnership or limited liability company action, as appropriate, on the part of
such Purchaser. This Agreement has been duly executed and delivered by such
Purchaser and constitutes a legal, valid and binding obligation of the Purchaser
enforceable against such Purchaser in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization and moratorium laws and other
laws of general application affecting the enforcement of creditors' rights
generally and general principles of equity.
3.3 APPROVALS AND CONSENTS. No action, approval, consent or
authorization, including, but not limited to, any action, approval, consent or
authorization by any governmental or quasi-governmental board, agency,
commission, bureau, or instrumentality is necessary or required as to such
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Purchaser in order to constitute this Agreement as a valid, binding and
enforceable obligation of such Purchaser in accordance with its terms.
3.4 INVESTMENT. Such Purchaser is acquiring the Note and the
Warrant for his own account as principal, not as a nominee or agent, for
investment purposes only, and not with a view to, or for, resale or distribution
thereof and no other Person or entity has a direct or indirect beneficial
interest in such Note.
3.5 EXEMPTION FROM REGISTRATION. Such Purchaser acknowledges
that the offering and sale of the Notes (the "Offering") is intended to be
exempt from registration under the Securities Act of 1933, as amended (the
"Securities Act"), by virtue of Section 4(2) of the Securities Act and the
provisions promulgated thereunder. In furtherance thereof, such Purchaser
represents and warrants to the Company as follows: (i) such Purchaser does not
have a present intent to distribute or transfer the Note or the Warrant issued
to it or the securities received upon conversion of such Note or Warrant; (ii)
such Purchaser has the financial ability to bear the economic risk of his
investment, has adequate means for providing for his current needs and
contingencies and has no need for liquidity with respect to his investment in
the Company; and (iii) such Purchaser has such knowledge and experience in
financial, and business matters as to be capable of evaluating the merits and
risks of an investment in the Notes.
3.6 ACCREDITED PURCHASER. Such Purchaser is, by virtue of his
position as an officer and/or director of the Company, or otherwise, an
"accredited investor," as that term is defined in SEC Rule 501.
3.7 TRANSFER RESTRICTIONS. Such Purchaser will not sell or
otherwise transfer the Note or Warrant issued to him, or the Conversion Shares,
without registration under the Securities Act or unless such Purchaser provides
the Company with an opinion of counsel for the Company, to the effect that a
sale, transfer or assignment of such Note, Warrant or such Conversion Shares may
be made without registration. Such Purchaser fully understands and agrees that
such Purchaser must bear the economic risk of such Purchaser's purchase because,
among other reasons, such Note, Warrant and Conversion Shares have not been
registered under the Securities Act or under the securities laws of any state
and, therefore, cannot be resold, pledged, assigned or otherwise disposed of
unless they are subsequently registered under the Securities Act and under the
applicable securities laws of such states, or unless exemptions from such
registration requirements are available. In particular, such Purchaser is aware
that such Note, Warrant and Conversion Shares are "restricted securities," as
such term is defined in Rule 144 promulgated under the Securities Act of 1933.
Such Purchaser further understands that sales or transfers of such Note, Warrant
and Conversion Shares are further restricted by state securities laws and the
provisions of this Agreement.
3.8 LEGEND. Such Purchaser understands and acknowledges that
the Note, the Warrant and the Conversion Shares shall bear a legend
substantially as follows:
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND THEY MAY NOT BE OFFERED,
SOLD, PLEDGED, HYPOTHECATED, ASSIGNED OR TRANSFERRED EXCEPT (i)
PURSUANT TO A REGISTRATION STATEMENT UNDER THE SECURITIES ACT WHICH HAS
BECOME EFFECTIVE AND IS CURRENT WITH RESPECT TO THESE SECURITIES, OR
(ii) PURSUANT TO A SPECIFIC EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT."
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3.9 RECEIPT OF INFORMATION. Each Purchaser has received and
reviewed this Agreement, his attorney and his accountant have had access to, and
an opportunity to review all documents and other materials requested of the
Company; he and they have been given an opportunity to ask any and all questions
of, and receive answers from, the Company concerning the terms and conditions of
the offering and to obtain all information he or they believe necessary or
appropriate to evaluate the suitability of an investment in the Notes; and, in
evaluating the suitability of an investment in the Notes, he and they have not
relied upon any representations or other information (whether oral or written)
other than as set forth in the documents and answers referred to above. Each
Purchaser further acknowledges that, by virtue of his position as an officer
and/or director of the Company, he has sufficient knowledge of the business
operations and financial condition of the Company to evaluate an investment in
the Company.
4. CONDITIONS TO CLOSING.
4.1 CONDITIONS TO CLOSING BY THE PURCHASERS. The obligations
of each Purchaser to purchase Notes at the Closing is subject to the fulfillment
to such Company's satisfaction of each of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES CORRECT; PERFORMANCE. The
representations and warranties made by the Company shall be true and correct in
all material respects when made, and shall be true and correct in all material
respects as of the Closing as if made at the Closing. All covenants, agreements
and conditions contained in this Agreement to be performed or complied with by
the Company at or prior to the Closing shall have been performed or complied
with in all material respects.
(b) QUALIFICATIONS. As of the Closing, all authorizations,
approvals or permits of, or filings with, any governmental authority, including
state securities or "Blue Sky" filings, that are required by laws in connection
with the lawful sale and issuance of the Notes shall have been duly obtained by
the Company, and shall be effective as of the Closing.
4.2 CONDITIONS TO CLOSING BY THE COMPANY. The obligation of
the Company to sell the Notes at the Closing is subject to the fulfillment to
the Purchaser's satisfaction of each of the following conditions.
(a) REPRESENTATIONS AND WARRANTIES CORRECT; PERFORMANCE. The
representations and warranties made by each Purchaser shall be true and correct
in all material respects when made, and shall be true and correct in all
material respects as of the Closing as if made at the Closing. All covenants,
agreements and conditions contained in the Agreement to be performed or complied
with by each Purchaser at or prior to the Closing shall have been performed or
complied with in all material respects.
(b) QUALIFICATIONS. As of the Closing, all authorizations,
approvals or permits of, or filings with, any governmental authority that are
required by law in connection with the lawful purchase of the Notes shall have
been duly obtained by each Purchaser, and, except as they may be appropriately
filed after the Closing, shall be effective as of the Closing.
(c) SUITABILITY OF PURCHASER. Each Purchaser shall be an
officer and/or director of the Company at Closing.
5. EVENTS OF DEFAULT AND REMEDIES.
5.1 EVENT OF DEFAULT DEFINED; ACCELERATION OF MATURITY; WAIVER
OF DEFAULT. If one or more of the following events ("Events of Default") shall
have occurred and be continuing:
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(a) default in the payment of all or any part of the principal
or interest of any of the Notes on their respective maturity dates; or
(b) failure on the part of the Company duly to observe or
perform any other of the material covenants or agreements on the part of the
Company contained herein, or in the Note or Warrant (other than that set forth
in clause (a) above) for a period of thirty (30) days after the date on which
written notice specifying such failure, stating that such notice is a "Notice of
Default" hereunder and demanding that the Company remedy the same, shall have
been given by registered or certified mail, return receipt requested, by or on
behalf of the Purchasers to the Company; or
(c) the Company shall fail to make any payment in respect of
any debt when due or within any applicable grace period, where such failure
continues and/or is not fully remedied within thirty (30) days or any event or
condition shall occur which results in the acceleration of the maturity of any
debt or enables (or, with the giving of notice or lapse of time or both, would
enable) the holder of such debt or any person acting on such holder's behalf to
accelerate the maturity thereof; or
(d) the Company pursuant to or within the meaning of any
bankruptcy law (i) commences a voluntary case or proceeding; (ii) consents to
the entry of an order for relief against it in an involuntary case or
proceeding; (iii) consents to the appointment of a custodian of it or for all or
substantially all of its property; (iv) makes a general assignment for the
benefit of its creditors; or (v) admits in writing its inability to pay its
debts as the same become due; or
(e) a court of competent jurisdiction enters an order or
decree under any bankruptcy law that (i) is for relief against the Company in an
involuntary case; (ii) appoints a custodian of the Company or for all or
substantially all of the property of the Company; or (iii) orders the
liquidation of the Company, and such order or decree remains unstayed and in
effect for sixty (60) days;
THEN the Purchasers (by vote of a majority-in-interest of the outstanding
Notes), by notice in writing to the Company (the "Acceleration Notice"), may
declare the Notes to be due and payable immediately, and upon any such
declaration the same shall become immediately due and payable; provided, that if
an Event of Default specified in Section 5.1(d) or 5.1(e) occurs, the Notes
shall become and be immediately due and payable without any declaration or other
act on the part of the Holder.
5.2 POWERS AND REMEDIES CUMULATIVE; DELAY OR OMISSION NOT
WAIVER OF DEFAULT. No right or remedy herein conferred upon or reserved to the
Purchasers is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy. No delay or
omission of the Purchasers to exercise any right or power accruing upon any
Event of Default occurring and continuing as aforesaid shall impair any such
right or power or shall be construed to be a waiver of any such Event of Default
or an acquiescence therein; and every power and remedy given by the Notes or by
law may be exercised from time to time, and as often as shall be deemed
expedient, by the Purchasers.
6. GENERAL PROVISIONS.
(a) ENTIRE AGREEMENT; AMENDMENT AND WAIVER. This Agreement,
the Notes and the Warrants constitute the entire agreement between the parties
hereto with respect to the subject matter contained herein and supersede all
prior oral or written agreements, if any, between the parties hereto with
respect to such subject matter. Any amendments hereto or modifications hereof
must be made in writing and executed by the Company and the Purchasers holding
more than fifty-one percent (51%) of the aggregate principal amount of the
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outstanding Notes. Any failure by the Company or the Purchasers to enforce any
rights hereunder shall not be deemed a waiver of such rights. The
representations and warrants set forth in this Agreement shall survive the
Closing.
(b) NOTICES. Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given (i) upon personal delivery to the party to be notified, (ii)
four (4) days after deposit with the United States Post Office, by registered or
certified mail, postage prepaid, or (iii) one day after deposit with a reputable
overnight courier service and addressed to the party to be notified at the
address indicated for such party on the signature pages hereof, or at such other
address as such party may designate by ten (10) days' advance written notice to
the other parties.
(c) GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of California without giving
effect to conflict of laws principles.
(d) BINDING EFFECT; ASSIGNMENT. This Agreement and the various
rights and obligations arising hereunder shall inure to the benefit of and be
binding upon the Company and the Purchasers and each of their respective
successors and assigns. Neither this Agreement nor any of the rights, interests
or obligations hereunder shall be transferred or assigned (by operation of law
or otherwise) by any of the parties hereto without the prior written consent of
the other parties hereto. Any transfer or assignment of any of the rights,
interests or obligations hereunder in violation of the terms hereof shall be
void and of no force or effect.
(e) HEADINGS. The headings or captions contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
(f) SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by virtue of any
rule of law, or public policy, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not
affected in any manner adverse to any party. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible in an
acceptable manner to the end that the transactions contemplated hereby are
fulfilled to the maximum extent possible.
(g) COUNTERPARTS. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
COMPANY:
SPACEDEV, INC.
By:
--------------------------------
Name: Xxxxx X. Xxxxxx
Title: Chief Executive Officer
Address: 00000 Xxxxx Xxxxx
Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
PURCHASER:
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Signature
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Print Name
Address:
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Attention:
[SIGNATURE PAGE TO NOTE PURCHASE AGREEMENT]
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EXHIBIT A
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SERIES A CONVERTIBLE NOTE
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EXHIBIT B
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FORM OF WARRANT
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